The Bridgeport evening farmer. [volume] (Bridgeport, Conn.) 1866-1917, 1917-11-26
LIBERTY BOND
LESSONS
BY HOWARD SPEER
OF HinckS Bros. s. Co.
Article No. Z
Two Sides Of a Picture

W. |
| Today we want to finish up this
matter of taxation so far as it has
cent. Liberty Bonds for the per cent.
next thing. You are probably tired
of all this taxation talk. That's just
the point You may be q good deal
more tired of it before the war is
over and that's why you ought to
| keep in close touch with the whole
matter and not do anything that you
may regret later.
| In the last few lessons we have
tried to show you the very direct eff
| feet which the rich mans tax prob
1 lem may have upon your welfare by
affecting the price Of your Liberty
bonds.
That is the pleasant side of the
picture from your point of view.
There is another side, though, that
isn't quite SO pretty to look at,-even
il you aren't, rich.
Suppose you decide to convert your
| 8 IL per cent. bonds into the per
| cent. issue. If your income is s5,-
600 a year or less you won't be taxed
on them. That's certain. And even
| if it is more than $1,000, you can
pay the tax on the AS and they will
still bring you in more interest than
the 1-2's SO long as your income
is less than 100000.
| There is yet another good point
about the AS that hasn't been men
| toned SO far because we didn't want
to confuse you. 1t is this. No mat
ter how big your income is, even If
-, 5oI1-
government will let you own as much
as $4,000 worth Of per cent. Liberty
Bonds without taxing the income of
5000 a year which you will get from
them. Now don't get those two S.
900 items mixed up. The $4,000
mentioned in the paragraph above this
one is annual income. The other S.
900 Is the amount of Liberty 4 per
cent. bonds you may own free of tax,
no matter how big your income is.
ALI right. On the strength of all
these facts you decide to convert 4
per cent. is better than 8 IL per cent.
and you would rather be sure of that
| than take a chance on getting a high
err price for your IL per cent.
bond.
But just a minute, please! Look
again at the reading on the 4 per
cent. bond, given in Lesson No. 4. You
see it is exempt from what is COM
monty known as the Surtax or SUI
pertax. Surtax means simply the grad.
ually increasing tax that you pay on
your income above a certain fixed
amount. This year that amount is
$1,000 as already explained. Does
anybody know how long it is going
to stay at $4,000? Last year it was
/ s2o.000L From $4,000 to $4,000 in
one year is quite a drop, isn't it?
Another thing. The rates Of the
surtax are fixed at present. How
long are they going to stay fixed
Nobody answers. Why? Because
nobody knows! b Last year they start
ed at 1 per cent. and went to 13 per
cent. This year they range from
per cent. to SO per cent. Last year
the 1 per cent. tax had to be paid
on all income between $4,000 and
1 $4,000. This year it must be paid
on income between $4,000 and $500
Last year man didn't have to pay a
per cent. supertax until his income
was over $4,000 a year, and then
he paid it on the amount between
$150,O00 and 100000. This year
they. don't even mention a 6 per cent
tax. It's too little to bother with They
just skip right from per cent. to Z
per cent. and leave that poor little 6
out in the cold with nobody to land
on. And do you know where thai
per cent. tax begins It begins al
$4,000 and goes as far as $4,000
Do those figures sound familiar? Oh
yes just look back a few sentences
, They are the figures that a man paid
1 per cent. on a year ago!
Do you see the point? Things are
beginning to get warm for you and
me. The per cent. Liberty bonds
are subject to the surtax and under
the present law you may be safe
enough. But they don't promise
that the surtax will always begin al
the same place and be assessed al
the same rates!
| Congress meets again in Deem Der
| 1t will probably not change this In
come Tax Law which they passed only
last October except perhaps to correct
some portions of it which have beer
very severely criticised. But the
Income Tax has been changed three
times in the last three years. Each
time it has been revised downward
that is, it has been made to hit smaller
, and smaller incomes.
war and nobody can say what the
end of all this taxation is going tt
be. It's all right. We are all good
Americans and we stand ready t.
; throw our dollars as well as our hat.
into the ring in order to see this figh-
: through to a real American finish
But that isn't any reason why we
shouldn't keep our eyes open and pu
our own affairs on the safest posi-
{ BILE business basis. When the gov.
eminent itself says we may do either
, one of two things we might as wei
do the thing that seems safer.
And that thing would seem to be
not only from the rich mans poin
of view, but from our own, to keeI
Liberty 8 IL bonds instead of con
{ verting into the 4 per cent. bonds.
r MORRISON GETS