Jackson County sentinel. (Gainesboro, Tenn.) 1914-current, 1917-06-14

eAC NAhootNiha4s puANcn VI tdAc@ al
war times certain scientific principles
are definitely established:
How Taxes Should Be Apporticnsd.
til Tue burden of taxes must be
spread as far as possible over the
whole community so as to cause each
| individual to share in the sacrifices &C.
cording to his ability to pay and ac-
cording TO bis share In the Government
- Taxes on consumption. which are
necessarily borne by the community at
large. should be imposed as far as pos
sib!e GH articles Of quasl-luxury rather
than OH those Of necessity.
81 ExCises should be imposed as far
as possible upon commodities In the
hands Of the final consumer rather
than upon tie articles which serve pri
marily as raw material for further
production,
"a Taxes upon business should be
imposed as far as possible upon net
earnings rather than upon gross re-
ceipts or capital invested.
90 Taxes upon income which will
necessarily be severe should lie both
differentiated and graduated. That is,
| there should DO distinction between
earned and unearned incomes and there
should I've higher rate upon the larger
incomes. 1t Is esscnt' al. however, not
TO make the income rate SO excessive
as to lead TO evasion. administrative
difficulties, or to the more fundamental
objections which have been urged
| above.
60 The excess profits which are due
to the war constitute tho most obvious
and reasonable source OF revenue dur.
Ing war times But the principle upon
which these war-proft taxes are laid
must be equitable in theory and easily
calculable in practice.
The Proposed Income Tax.
The additional income tax rs passed
by the House runs up to II rate Of CO
per cent. This Is a sum unheard of In
the history of civilized society, II MUST
| be remembered that II was only after
| the first year of the war that Great
Britain increased her income tax to the
maximum Of 81 per cent. and that
even now in the fourth year Of the war
the income tax does not exceed 42la
per cent
Ii could easily be shown that tax
with rates on moderate incomes sub.
stantially less than in Great Britain.
aud on the larger incomes about as
high, would yield only slightly less than
the $3.50, 100000 originally estimated in
! the House bill.
1t is to be hoped that the Senate will
reduce the total rate OH the highest IN.
comes to "a per cent, or Mt most to 40
per cent, and that at the same time II
will reduce the rate on the smaller in.
comes derived from personal or profes.
sional earnings.
If the war continues we shall have to
depend more and more upon the in
come tax. BY imposing excessive rates
now we are not only endanasrino the
future, but are inviting all manner OF
difficulties which even Great Britain
has been able TO escape.
Conclusion.
The House bill contains other funda-
mental defects which may be summed
up as follows:
u 1t pursues an erroneous principle
In imposing retroactive taxes.
90 1t selects an unjust and unwork-
able criterion for the excess-profts tax.
(3 1t proceeds to an unheard-of
height In the income tax.
(4) 1t imposes unwarranted burdens
upon the consumption Of the commu-
nifty.
90 1t is calculated to throw business
into confusion by levying taxes on gross
receipts instead Of upon commodities.
co. 1t fails to make a proper use OF
stamp taxes
"a 1t follows an unscientifc system
In its fiat rate on imports.
(S) 1t includes multiplicity of pet
ty and unlucrative taxes, the vexatiOus-
ness of which is out OF all proportion to
the revenue they produce.
The fundamental lines ON which the
House bill should be modified are sum-
med up herewith:
ID The amount of new taxation
should be limited to $1,250,000, 0O0-or
at the outset to 81, 500, 100000. To do
more than this would be as unwise as
1t Is unnecessary. To do even this
would be TO do more than has ever
been done by any civilized Govern
ment In time of stress.
(2) The excess. profits tax based upon
sound system ought to yield about
$500, 100000.
81 The income-tax schedule ought to
be revised with lowering of the rates
on earned incomes below $4,000, and
with an analogous lowering OF the
rates on the higher incomes, so as not
to exceed "a per cent. A careful cal
culation shows that an income tar OF
this kind would yield some s45OOOO.-
600 additional.
"a The tax on whisky and tobacco
ought to remain approximately as 1t Is.
with yield Of about $3.50, 100000.
These three taxes, together with the
stamp tar at even the low rate of the
House bin, and with an improved au.
f0mnhiIa fax Will viald nrar Ell osn