The labor world. [volume] (Duluth, Minn.) 1896-current, 1918-04-06
THE uneven TAX BURDEN

{From Christian Science Monitor.)
1t is becoming increasingly evident
that the United States income and
excess profits tax laws will have to be
amended, IL the government is to con-
tinue to meet it's heavy expenditures
on account of the war. The burden
is not equitably distributed The So
called middle classes. under the exist
ing laws, not only have to pay the
largest proportional cost, but it is to
them mainly that the government
looks as purchasers of the liberty
bonds. That they came loyalty to the
support of the government in the two
campaigns undertaken for raising the
money needed for the war is we'll
known. 1t is hoped that it will not
be on account of their unwillingness.
but because of their inability. Wages
and salaries have not kept pace with
the increasing cost Of living. and the
average man on salary has already in
vested his savings, or considerable
part of them, in liberty bonds. The
new income tax which he is called
upon to pay is all out of proportion to
that Of his more prosperous neighbor,
and. after having been forced to re-
duce his living expenses, he is not in
position to bear so large portion
of the war burden as that now placed
upon him.
There has been some investment in
liberty bonds by corporations, but
the purchase of bonds on their part
has been in no wise commensurate
with the enormous earnings which
many of them have been piling up,
largely because Of the war. Much of
the money which they have thus been
able to accumulate has been turned
back into their business as working
capital with which to make more
money, or used in paying debts. or
in making extensions of plant. In
word, they have been waxing rich on
have been uniformly high. and this
has helped to increase the cost of liv-
ing for every one. Many corporations.
which before the war were barely
able to make ends meet, and some
which were on the verge of receiver
ship, report earnings for last year Of
from 40 to 80 per cent, after making
allowances for their excess profits
taxes and liberal deductions for de-
probation and other charges. These
enormous profits are not the excep-
ton, but the rule, with those compan-
les engaged in war work.
The excess profits tax law provides
for a sort Of sliding scale tax, and
when it was framed it was probably
deemed sufficient to meet the de-
n1ands. Certainly no one dreamed
that concerns engaged in war work
would be able to pile up the tremen
dous earnings that have since been
reported by them. Now. there is no
good reason why any individual or
corporation should make: money out
Of the war. The government would
be justified in, taking the entire excess
profits Of every concern, and any one
raising a complaint against such &C.
ton could not be considered wholly
patriotic. The United Kingdom takes
about 80 per cent of the excess profits
of corporations. This percentage is
much greater than that obtained in
the United States in any case. It does
not work a hardship, because the ex-
cess profits would not have been
| made but for the war;
Although strenuous opposition
might be raised by concerns engaged
! in war work if the United States gov
eminent were to require them to con-
tribute more largely to it's expendi-
, lures, the time is evidently coming
when they will have to give up a
! greater proportion of their earnings
There is no other, source from which
! the money needed can come in any
| thing like sufficient amounts. The
| public in general, however, including
the corporations. believes in fair play,
and the justice of evening up the war
burden will doubtless eventually be
! recognized by all.