Evening star. [volume] (Washington, D.C.) 1854-1972, 1917-08-23


Plans Are Compared.
First, I will trace it through accord
ing to the ma jofity report and then ac-
cording to the minority report. Taking
the ma ajority plan of taxation, you would
pay. upon a $4,000 income, 2 per cent
normal tax under the present law,
per cent normal tax added by the present
bill and per cent war surtax added
by the proposed bill. In other words, if
you add together the several rates of per
cent you pay total of per cent tax;
but, as a matter of fact. when you have
paid at the various stages below $4,000,
the rates fixed in the law, instead Of pay
ing s per cent on $4,000 income. as a
matter of fact, you pay 3.55 per cent.
That is. you pay the same amount that
you would pay if the income tax were a
fiat tax of 3.55 per cent.
We are likely, from taking the rates
named in the bill. to get the idea that the
owners of great incomes in this country
are going to be assessed very much
higher rate than they are actually es-
sessed upon their incomes. If you can
once get fixed in your minds the deduc-
tions that must be made for the amounts
paid at the lower rates at every bracket
and get the equivalent fiat tax, then you
ineosne txsueis4rtzx 10 very low one. in
deed
'.Take an income of $4,000 Under the
maj jority plan, as reported, 1t would pay
which, with the war normal and war sur
tax, makes a total of IA per cent.
I'VE are not taxing at that rate. When
you have worked out what the recipient
of an income of 100000 will pay upon 1t
after he pays the lower percentages on
the lower brackets of his Income. instead
of coming to II per cent he pays what
would be the equivalent of fiat rate OF
6.2 per cent
Never Had Fair Income Tax.
1--WE never have had the slightest ap-
proach to an income tax that was fair
in this country. We never have had
anything like the income tax OF Great
Britain. 1t is true, as suggested here
on the floor that Great Britain has
levied upon the lower incomes higher
taxes than are proposed here, but she
has levied higher taxes upon the great
mass of the big incomes that fall be-
tween, say, $4,000 and 100000. where
the amendment of the senator from
Rhode Island begins to attach-and that
is where you get the great bulk OF big
incomes and it is from those incomes
that you will secure great income tax
return, If that is what is desired.
Now, Mr. President, go a step fur
ther with me in seeing how these rates
really work out when YOU apply them
as they will be applied when you come
to pay your tax and collect your tax
from others.
4 gave you the CASE VI t"SHty :.
thousan nd dollar income Take sixty
thousand dollar income A sixty-thou-
sand-dollar income. as proposed in the
committee BILL will first take its per
cent normal tax under the existing law.
Then Ii will take per cent surtax
under the existing law. Then, when we
come to the provisions of this bill. it
will have applied to it a second normal
tax of per cent. 1t will then have ap-
piled to it what you would call a war
surtax. a temporary surtax of IL per
cent, like the temporary additional nor
NAL tax, that is to last as long as the
war. The total of this is 19 per cent,
and it may be said that you are assess
ing incomes of $4,000 10 per cent You
are doing nothing of the kind. Here is
what you are doing: You are assessing
them the equivalent of a fiat rate of Ill
per cent