The evening herald. [volume] (Albuquerque, New Mexico) 1914-1922, 1914-12-30
INCOME TAX NOT A
SUCCESS, ADAMS
TELLS A. {. A.
Wisconsin Revenue Commits
sioner Declares Federal
Measure Has Failed to At
tain Anticipated Objects.

Princeton, y. j.. Dec. 30.-The fed
eral income tax. for which only 357,-
SOS returns were received last year
~ reaching directly 5css than one-half
OF enc per cent pf the population,
promotes class conflict and public ex-
travagance. and Is q feeble instrument
with which TO reduce swollen for
tunes. In the opinion of r. :. Adams.
member Of the Wisconsin state tax
commission. In an address before the
American Economic association here.
Mr. Adams spoke ON The effect OF
income and inheritance taxes on the
distribution of wealth"
THE present federal income tax Is
a class taN n class taxes breed oX-
tr~avaEance," he said. 1T deserves
approval from almost every other
standpoint. but In this respect II needs
courageous correction. Income taxes
should not be levied upOn the poor
but they should he levied upon all the
rich. l. g.. upon everyone with an in
come exceeding tho amount required
by the American standard OF living.
An income tax falling on all the rich,
so defined, would be the most potent
Instrument %procurablo FOR inspiring
and maintaining an effective interest
In the conduct Of governmet.
"If swollen fortunes are bad. they
should be attacked directly and the
cause removed. To Jet them accumu-
late and then tax them 10 per cent
smacks Of %hypocrisy, and the attempt
to make the income tax do the work
Of social reform Is apt to spoil the
H. - a.m.N 10
my opinion the income tax could per-
form its best service as "a substitute
for the personal property tax as APP
piled 10 business enterprise. The loss
in modern business Is enormous. the
necessary hazards are great, and a
strikingly large proportion OF con-
| Germs in some line constantly totter
on the brink Of Bankruptcy. To all
such marginal enterprises the prop
erty tax TX remorseless IL falls on
property az much whether tt Is pro-
ductive or u-nproductive, whether u
Is owned free or heavily elcumbered,
| whether u Is part OF a trustworthy
hut desperate new business venture
or part OF the sal Of a diving con-
Germ. The property Tax dis ourages
experiment. penalties industrial plo-
neering. retards PRODUCTION, reduces
supply u Increases prices. In short,
ID Is partly shifted to consumers, re-
duces the amount 0f wealth 10 be div
lded and Adversely affects the dtstri-
button OF what rs produced. In COM
parlson the Income tax Wrests little
Or nothing from the new, the expert
mental or the unfortunate business
| enterprise: II helps not only the small
business man, hut large concerns IN
new and hazardous undertaking. II
heips-or abstains from burd"nlng-
every business enterprise IN a pad
year.
The property tax puts the state IN
the position OF "a preferred creditor
and "a harsh ono. Its dues u be
paid oy the business man in the de-
velopment period Of the business. be-
fore profits are earned, and later
whether profits are earned or not.
The income AK. however. presents the
state in the attitude of a partner or
| pront sharer. The first attitude IN not
wholly indefcnsible, nor altogethet
unfortunate. But with respect to bus
mess enterprise n needs TO be SOFT
cacd by increasing emphasis upon
ability TO pay, There h a o~l
| feeling among the operators and own
ers OF public utilitics that government
ownership is Inevitable. This feeling
or movement Is measurably stlmulat-
ed by the rigers ~ the property TAX.
The railroads Of this country, Tor IN
stance. are al pre cent paying over 10
per cent OF their net earnings IA
taxes. and In some states the proper
ton exceeds 20 per cent II our tax
system gave greater scope 10 the me-
income principle. b would materialls
enhance the chances Of private own
ership and operation. The Income 'ss
works for the retention Of privats
management, d makes h state mo-
a preferred creditor, and not the sole
owner, but a FOL l-Aedged and sylmpa'
thetic mariner In private Industry.