Evening star. [volume] (Washington, D.C.) 1854-1972, 1914-03-22

own income and expenditures? We all
know in a general way how much we
make a year and how much We spend,
but most of us are in trouble When IL
comes to setting out the exact figures.
'In my own case, for an example.
found when l came to check up Tor my
income tax return and to inquire out my
exact financial situation that l had been
guilty of a lot of fool expenditures during
the year The total of these surprised me,
and 1 don't think am an exception to the
general rule. A habit Of taking stock OIL
ones assets and liabilities ones income
and ones expenditures, is good one; ana
better habit is that of keeping what
amounts to an individual cost sheet L
am inclined to think that the income tax
law will promote such habits.
II am aware OF the many complaints
that have been made against the income
tax law, of the charge that the collection
at the source idea is cumbersome and
imposes an unnecessary burden on the
several sources Nevertheless much OF
this complaint will pass as the law be-
comes better understood and as simpler
methods are devised by the collecting au-
thorities One should bear in mind that
the law is simple in its principles, IS
easily mastered if one will but look into
it, and that it is complete in itself even
without the collection at the source
proviso-
Much Of the co. plant arises from
tue multitude OF blanks provided for
claiming exemr tion,; and from the in
tricate system resulting therefrom. My
own opinion is hat the Treasm! Depart
ment will simplify the process materially
as the law becomes better understood.
This yefy completely arises chiefly
from the activities OF the sources them
selves rather than from any defect in the
law. Some very large corporations had
written into their bonds provision that,
in the event Of the adoption OF AN income
tax law, the corporations themselves,
rather than the holder of the bonds,
would pay that tax. This provision per-
United the securities to be sold at a
higher figure than they otherwise would
have commanded. The corporations were
the beneficiaries. ~ T.
when the law went into effect these
corporations naturally wanted to escape.
the burden imposed on them oy the pro-
vision they had inserted. Hence they in
sisted that the individual bondholders
claim II exemptions for themselves, and
the agi ton that resulted brought about
the adoption by the Treasury Department
of the many different classes of aHdaylts
and blanks that have to be signed.
While, as j have said much Of the
complaint as to the completely incident to
the collection will disappear with revised
Treasury regulations a certain amount of
compiexity is Inevitable. and that is tile
result of the complexity of our own bust
ness systems which are far more in
tricate than in any other country. In
England, from which country we bor-
rowed, in modified form, the collection
at-the-source' plan. a government regis
tration of bonds makes easier the identifi-
cation of the individual owners than is
possible in this country. where there is no
such registration. -- .,.r
y
The subcommittee in charge of the
income tax bill went carefully into this
whole subject when the bill was under
consideration, and adopted the collection
at-the-source' plan only after mature
study and elaboration. There were three
alternatives, namely: Collection at the
source. information at the source. and a
system Of taxing the corporation income
as a whole and requiring the corporation
to distribute the tax among its bond
holders and stockholders. deducting the
same from interest and dividends.
Taking these up in their inverse order
the last-named method feel sure could
not be made practicable within any short
period of time, unless the corporations
should actually deduct the tax from the