The Rathdrum tribune. (Rathdrum, Idaho) 1903-1963, 1917-06-22


spread as far as possible over the
whole community so as 10 cause each
individual to share in the sacrifices &C
cording to his ability to pay and ac-
cording to his share in the Government
~ Taxes on consumption. which are
necessarily borne by the community at
large, should be imposed as far as pos
sible on articles Of Quasi-luxury rather
than on those Of necessity.
81 Excuses should be imposed as far
as possible upon commodities In the
hands Of the final consumer rather
than upon the 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 be both
differentiated and graduated. That Is,
there should be distinction between
earned and uneamed incomes and there
should be higher rate upon the larger
incomes. 1t is essential, 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.
Co. The excess profits which are due
to the war constitute the most obvious
and reasonable source Of revenue dur
ing war times. But the principle upon
which these war-profit taxes are laid
must be equitable in theory and easily
calculable in practice.
The Proposed Income Tax.
The additional income tax as passed
by the House runs up to rate of GO
per cent This is sum unheard of In
the history of civilized society. 1t must
be remembered that it was only after
the first year of the war that Great
Britain increased her income tax to the
maximum of "a per cent, and that
even now IN the fourth year Of the war
the income tax does not exceed 4212
per cent.
1t could easily be shown that tax
with rates on moderate incomes sub
stantially less than In Great Britain,
and on the larger incomes about as
high, would yield only slightly less than
the $532, 100000 originally estimated In
the House bill
1t is to be hoped that the Senate will
reduce the total rate on the highest in
comes to 81 per cent, or at most to 40
per cent, and that at the same time 1t
will reduce the rate on the smaller In
comes derived from personal or profess
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 endangering the
future, but are inviting all manner Of
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:
ID 1t pursues an erroneous principle
in imposing retroactive taxes.
(2) 1t selects an unjust and unwork-
able criterion for the eXcess-profits tax.
90 1t proceeds to an unheard-of
height in the income tax.
(4) 1t imposes unwarranted burdens
upon the consumption of the commu
atty.
90 1t is calculated to throw business
INTO confusion by levying taxes on gross
'eceipts instead Of upon commodities.
go 1t fails to make proper use of
stamp taxes.
"a 1t follows an unscientiic system
n its fiat rate on imports.
(S) 1t includes multiplicity of pet
y and unlucrative taxes, the vexatious-
less Of which is out of all proportion to
he revenue they produce.
The fundamental lines on which the
House bill should be modified are sum.
ned up herewith:
ID The amount of new taxation
hould be limited to ,25O,O0O, O0O-or
t the outset to $1,5O0,00O,OOO. To do
nore than this would be as unwise as
Is unnecessary. To do even this
you'd be to do more than has ever
zen done by any civilized Govern
1ent In time of stress.
% The excess-profits tax based upon
sound system ought to yield about !
5OO,0O0,O0O.
90 The income-tax schedule ought to
g revised with lowering of the rates
n earned incomes below $4,000, and
nth an analogous lowering of the
ates on the higher incomes, so as not
exceed "a per cent. A careful cal
1lation shows that an income tax of
us kind would yield some $45O,OOO,.
10 additional.
~ The tax on whisky and tobacco
lght to remain approximately as II Is
'lth a yield of about $3.50. 100000.
Ihese three taxes, together with the
amp tax at even the low rate of the
-ouse bill, and with an improved nm.
oInoDlle tax, will yield over 81 .25O-
1000, which Is the amount of money
fought desirable.
The above program would be in har-
ony with an approved scientific sys.
IN. 1t will do away with almost oil
the complaints that are being urged
salnst the present. It will refrain
ON taxing the consumption of the
,or.
"a in