The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-10-19
SELIGMAN ADVISES
DIRECT INCOME TAX
Best Solution Of City's Eco
nOmic Problem, Says Co.
lumbia Expert.
SYSTEM OF EXEMPTIONS

Prof. Edwin u. A. Selieman of Column
kla University told the Mills legislative
committee on taxation yesterday that
the best solution OF the economic stu
New York city. now finds itself will be
found In the imposition Of a direct in
come tax. He based his advocacy Of II
upon the fundamental ground that
pronts rather than property should be
the standard OF tho ability Of the in
dividual or the corporation to pay taxes.
He said he believed that the United
States should take example from Eng
land. France and Germany and should
strive to eliminate the general property
tax. both real estate and personal es-
tate. as supports OF government ard
should substitute the income tax. For
the present. however. he would retain
the tax on real estate and all OF the spe-
ciic taxes, such as inheritance taxes.
mortgage and secured debt taxes. liquor
licenses and stamp taxes, eliminating
only the personal property tax. until the
direct income tax had been well SET
uDon it's way as the chief source of
revenue.
Exemptions for Laborinw Men.
He said that the minimum amount re-
Quared by a man to supper himself or a
family would vary with the community
in which he lived, but he thought that
under conditions In New York an un-
married man ought to be exempted 10
the extent OF $1,000 and that a married
man should not be taxed unless his IN
some reached $500 or $500, with a
further allowance of perhaps 5000 for
GACh minor child. He said this would
exempt the average farmer and the aver
aSe lab0ring a
A. for the rate, he said that should
depend upon how much money the State
wanted to raise. BY leaving out public
service corporations. now taxed specially
and by making liberal allowances for
such part OF incomes AS are property
c0llectibie In other States he had com.
puted that at a rate of ! per cent. be-
tween S21. 000. 900 and s22, o00, 600 could
bs raised.
Exempting incomes Of from 81. 200 t.
$4,000. according to the situation OF the
recipient. and imposing a rate OF l per
oont. on the frst $1,000 above that. OF
~ per cen on the second $1,000, and
IU1UU1lIlk u Tdtt " 8 ItT CCUt. VII tNcEs
$1,000 above the second. he said, the
9tass could raise $4,000. 900. He said
~ had worked out these figures with
groat care and would stake his reputa-
ten v a scientist upon them. Such a
Ovenus, he believed. would enable the
State to do away entirely with the per
sonal property tax n still hav So
600, 900 or $1,000. 600 left.
Prof. Seligman spoke against the grad
ua4ed income tax. saying he believed
that a fiat rate was fairer and would give
u greater yield, In view OF the fact thai
the Federal Government already i'm.
poses q graduated income tax and also 4
super tax. As for the charge that such 4
scheme might involve double taxation. he
said that the mere fact that different
parts of our Government make use OF
the same base for purposes Of taxation
makes no difference so long as the a
gregate amount collected from the ind
viduai or the corporation is not burden
some"
Allowed by New Consultation.
In his opinion such a tax could be
levied successfully only by the State,
He explained that under the proposed
Constitution there would be no question
OF the propriety OF the state levying this
tax, but that In his opinion no such
question can he raised even under the
present Constitution. BECAUSE an income
tax Is really an excise tax and Is not
a property tax, which, under the present
Constitution, must be assessed by local
authorities. He thought the rule OF Sc
crecy ought to be preserved except In
respect of the net incomes OF corpora
lions. Under the Federal law such cor.
porate incomes are open to the inspec-
tion OF the authorities in those States
which have income tax laws, and Prof
Seligman said that the corporations
could make a return in duplicate. thus
saving time and expense.
1T In by no means IN ideal system
said Prof Seiigman, land there is ne
ideal system. hut on the whole il has
such immense advantages over the pres.
ent outrageous and uncivilized SYSTEM
7 call any system uncivilized that makes
liars out OF men-that We can afford
to overlook it's faults
Lawson Purdy, president OF the Board
OF Tax Commissioners and A. Il. fkp''en,
tax attorney for the American T,le-
phone and Telegraph Company, will he
witnesses before the committee at the
resumption Of it's hearing this morning
at 1850 o'clock. senator Mills an
n0unced that tomorrow at noon the
committee would hear any one who de
sires to give information on the subject
Of the committees investigation, The
hearings will end tomorrow. on No
vember 20 the committee will go 10 syria
cuee. and then to Rochester and Buffalo