The Meeker herald., 1917-06-23


the extraordinary burden of taxes I'll
war times certain scientific principles
are definitely establishes:
How Tasss Should Be Appors'onsd.
a. The burden OF taxes must be
spread as far as possible over the
whole community so US to cause each
individual to share In the sacrifices &C.
cording to his ability to pay and &C.
cording to. his share In the Government
~ Taxes OIL consumption. which are
necessarily borne by the community at
large. should be imposed. as far as pos
sible on articles Of quase.uxury rather
than on those of necessity.
(3) Excuses should be imposed as far
rs possible upon commodities In the
hands of the final consumer rather
than upon the articles which serve pri-
murily as raw material for further
production.
~ Taxes upon. business should be
imposed as far as possible upon net
earnings rather than upon gross re-
celpts or capital invested.
o. Taxes upon income which will
necessarily be severe should be both
differentiated and graduated. That is,
there should be distinction between
earned and slnearDcd incomes and there
should be n 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.
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 az 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 1t was only after
the first year of the war that Great
Britain increased her income tax to tho
maximum of "a per cent. and that
even now in the fourth year Oft war
the Income tax does not exceed 42A
per cent.
1t could easily be shown that a 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 $3.50. 100000 originally estimated in
the House bill.
1t is to be hoped that the Senate will
| ro1rco b, total r0 IN nm tho hiO1lnqt in,
comes to 81 per cent. or at most to ~
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 mors and more upon the in.
come tax. BY imposing excessive rates
now we are not only endanserin9 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:
a. 1t pursucs an erroneous principle
in imposing retroactive taxes.
(2) 1t selects an unjust and unwork-
able criterion for the excess-profits tax.
| az 1t proceeds to an unheard-of
height In the income tax.
| az 1t imposes unwarranted burdens
upon the consumption of the commu-
nifty.
(5) 1t is calculated to throw business
into confusion by levying taxes on gross
receipts instead of upon commodities.
(6) 1t fails to make a proper use of
stamp taxes.
q, 1t follows an unscientific system
In its fiat rate on imports.
(S) 1t includes multiplicity of pet
| ty and unlucrative taxes, the vcxatious-
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:
| az The amount Of new taxation
should be limited to $3.50. 900. O00-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 my civilized Govern
ment in time of stl ess.
(2) The excess-profits tax based upon
a sound system ought to yield about
$500. 100000.
g, The income-tax schedule ought to
be revised with n 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 IN income tax OF
this kind would yield some S45OOO0.-
600 additional.
a. The tax on whisky and tobacco
ought to remain approximately as it is.
with Weld of about $3.50 100000.