The Greenville journal. [volume] (Greenville, Ohio) 1850-1918, 1917-06-14

ludn OIL those OF 0eCeSSlly.
(3) Exclses 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.
(4) 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
necessarily be severe should be both
differentiated and d'gfaduated. That is,
there should be a distinction. between
earned aud unearned incomes and there
should be a higher rate, upon the larger
incomes. II is essential, howeter, 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-proft taxes are laid
must be equitable In theory and easily
calculable in practice.
The Proposed Income Tax.
The additional income taX'as pGsaed
by the House runs up to a rate Of 60
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 421lS
per cent. ,,..
It could easily be shown that ftax
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 $532OO0.OO0 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 "a 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.
II the war continues we shall have to
depend more and more upon the. in
come tax. BY imposing excessive ratOO
now we are not only endangerina the
future, but are inviting ell 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:
O 1t purSues an erroneous principle
In imposing retroactive taxes.
(2) 1t selects an unjust and unwork-
able criterion for the excess-proflts tax.
(3) 1t proceeds to an unheard-of
height in the income tax.
a. 1t imposes unwarranted burdens
upon the consumption Of the commu-
nifty
o. 1t is calculated to throw business
into confusion by levying takes on gross
receipts instead of upon commodities.
(G) 1t fails to make proper use Of
stamp taxes.
CO 1t follows an unscientihc system
n its fiat rate on imports.
(Sl 1t includes q 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:
a. The amount of new taxation
should be limited to $1.25O,OOO, ,OOO-Or
at the outset to $1.5O0.0OO,OO0. TO do
more than this would be as unwise as
1t Is unnecessary. To do even this
would be to do more than thaS ever
been done by any civilized Govern
ment In time of stress.
~ The eVcess-profts tax based upon
a sound system ought to yield about
SJOO0OO,OOO
g. 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 -34 per cent. Aacareftif cal
culatiOn shows that an income tax of
this kind would yield some $450.O00.-
O00 additional
a. The tax ON whisky and tobacco
ought to remain approximately as 1t is.
with yield of about $23O,OO0,OOO.
These three taxes, together with the |
stamp tax at even the low rate of the
House bill, and with an improved au-
tomobile tax, will yield over $780,
600, 600, which is the amount of mUuay
thought desirable.
The above program wontd be In bar.
mOny with an approved sctehtfAc sysFl
TEN. 1t will do away with almost all /
of the complaints that are being urgea |
against the present. 1t VIII refrain
from taxing tn" cnns1mptfon Of the
poor.
1t will throw far heavier burden
upon the rich, but VIII not so to the
extremes of cOnfiScatfon. 1t will Ob-'
viate' mterfereBee with business and
VIII keep unimpaired the social pro-
ductlvity Of the o6manua3tss
It will establish a just balance be-
tween loans aiEd tazeas ana viii not |
Euccumb to the danger Of approaching
either the tax-only policy or tEe loan
only policy Above alt II wiz keep
IN mdisturhed elastic margin, which
must be more and more heavily drawn
upon as the war proceeds
! 81 AaesM "A