The sun. [volume] (New York [N.Y.]) 1916-1920, 1918-09-26
Kitchin Taxes and Liberty Bonds.

Kitchin Taxes and Liberty Bonds.
In his Liberty loan address Secre-
tary MCADoo emphasized the fact,
which The SUN has been impressing
upon the Congress revenue makers.
that the third Issue was taken by
small subscribers. There were In ell
$4,000, 0oU subscriptions; the average
was only $246. Furthermore, out Of
the 100000 subscribers Secretary
McApoo told his audience. there were
only 22,50O, including corporations,
who bought Liberty bonds in excess
Of $4,000 each. He says that for
the fourth loan, now all but under
way. we must largely increase the
number of subscribers between S10,-
600 and 100000.
1t is indeed important that the
number Of big subscribers should be
increased. 1t is necessary to the
success of the fourth loan that both
business interests and individuals Of
big incomes should join the millions
of small subscribers that are assured.
But to do so 1t Is essential that they
should have the money in hand or
in prospect.
In the third Liberty loan campaign
business interests and individuals Of
big incomes dependent upon business
did not know whether they could sur
scribe in dollars or in pennies. They
did know that right on the heels
of the bond subscriptions were COM
ing the payment Of income taxes and
Of profits taxes They were all at
sea as to how the provisions Of the
revenue act would be interpreted |;
the tax collectors themselves were all
at sea. So those business interests
and individuals, even of moderate in
comes, were gathering and holding
their cash resources for the impend-
ing taxes.
at would be preposterous," de-
clared Mr.. McADoo, ito say that there
are only 22,5OO men, women and cor
porations in America able to lend
more than $4,000 each to their Gov
eminent on Liberty bonds
Preposterous, II men, women and
corporations know that they will be
able to meet the bond payments. But
II they do not know and cannot know,
what then? They do not know and
cannot know now, when there is no
way to tell what the Congress tax
schedules will be; how much Of the
income Of a business the taxes will
take; whether the taxes will permit
the business to live or kill It.
Business interests and individuals
Of big incomes, even moderate IN
comes, are in a deeper doubt to-day
as to their ability to pay for bonds
than they were before the third Lib.
erty loan. They know to a dead GER
tainty that their taxes are going to
be still higher than they were last
year, but they do not know how much
higher. They wish to pay In taxes
and are prepared to pay, all they can
pay safely. But they do not know
whether the tax gatherers will leave
them enough surplus to put into bonds
They do not know whether the tax
gatherers will leave them enough to
conduct their business as It must be
conducted to be sound. They do not
know whether they will be able tc
stay In business. much less take big
allotments of bonds. They cannot, as
they have been urged to do, borrow
money from the banks to put into
bonds with any assurance that they
can pay it back.
The average man, immune from the
pursuing KrTcHIN, knows that one
way or another he can save so much
month, so much a week, so much q
day, to pay his Liberty loan install
ments. Tho business interests and
the individual whose income depends
upon the business interests cannot be
sure of anything Of the kind. They
may save in every possible way; from
the beginning to the end of the yeal
they may rake and scrape to build vi
q fund with which to buy bonds or Il
pay instruments on them; but nj
that they can be sure of Is that thu
Congress war taxes may come alonl
and scoop 1t.
These tax laws are enacted almos
fatally Mt the end Of business year
In November or December the bust
ness interest or man Of big income 1.
told what taxes he must pay for tn
whole preceding year. He hash
known single thing about 1t durlnl
all the weeks and months he has beer
compelled to do business with thi
shadow OF uncertainty hanging owe
him. Chairman KITcHIN's work THU