Mountain Home Republican. [volume] (Mountain Home, Idaho) 1915-1946, 1917-06-23

the enormous loans which win be necei
sary In any event.
A. Excessive taxes ON wealth vii
cause serious diminution of the In
comes which are at present largel,
drawn upon for the support of educa
tonal and philanthropic enterprises
Moreover. these sources of supper
would be dried up precisely at the tim,
when the need woald be greatest.
.. Excessive taxation at the outset o
the war will reduce the elasticity avail
able for tho Increasing demands tina
are soon to come.
Great Britain's Policy.
Take Great Britain as an example
During the first year Of the war she
increased taxes only slightly, in order
to keep industries going at top notch
During the second year she raised by
new taxes only 8 per cent. Of her war
expenditures. During the third year
she levied by additional taxes lover
and above the pre-war leveD only
slightly more than II per cent. of her
war expenses.
Ii we should attempt to do as much
In the first year Of the war as Great
Britain did in the third year 1t would
suffice to raise by taxation 81 $50, 600.
600. II, In order to be absolutely on
the safe side, it seemed advisable to
Increase the sum to $1,500000,00O. this
should, In our opinion, be the maxi
mum
In considering the apportionment of
the extraordinary burden of taxes In
war times certain scientific principles
are definitely established;
How Taxes Should Be Apportionsd.
"a The burden Of taxes must DO
spread as far as possible over the
whole community so as to cause each
Individual to share In the sacrifices ac-
cording to his ability to pay and &C.
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.
go 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.
~ Taxes upon business should be
imposed as far as possible upon net
earnings rather than upon gross re-
ceipts or capital invested
% Taxes upon income which will
be severe should be both
differentiated and graduated. That Is,
there should be distinction between
earned and unearned incomes and there
should be higher rate upon the larger
Incomes. Ii 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.
80 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-protit 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 60
per cent. This is sum unheard of In
he history of civilized society. 1t must
be remembered that it was only after
he first year Of the war that Great |
Britain increased her income tax to the |
maximum Of "a per cent. and that |
wen now In the fourth year of the war
he income tax does not exceed 425h |
yer cent
1t could easily be shown that a tar |
With rates on moderate incomes sub. |
tantially less than In Great Britain,
md on the larger incomes about az
Ugh, would yield only slightly less than |
he $500, 100000 originally estimated In
he House bill
1t Is to be hoped that the Senate will |
educe the total rate on the highest In. |
ONES to "a per cent, or Mt most to 40
er cent, and that ut the same time IL
yill reduce the rate on the smaller In
0mes derived from personal or profess
lonal earnings.
II che war continues we shall have to
epend more and more upon tho In.
oFne tax. BY imposing excessive rates
ow we are not only endangering the
Iture, but are inviting all manner of
lfficuIties which even Great Britain
az been able to escape.
Conclusion.
The House bill contains other funda.
rental defects which may be summed
p as follows:
III 1t pursues an erroneous principle
! imposing retroactive taxes.
e. It selects an unjust and unwork.
BILE criterion for the excess-profts tax.
81 It proceeds to an unheard- of
eight in the income tax.
"a 1t imposes unwarranted burdens
pom tho consumption Of the commu.
lily.
% 1t Is calculated to throw business
ito confusion by levying taxes on gross
'ceipts instead of upon commodities.
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