The Republican journal., 1918-03-14

5000 16 per cent. ll2 p. q.
10000 20 per cent. 3h p. c.
5000 25 per cent. p c.
If we add the so called "Occupa-
tional' tax our total taxation on in
comes of $4,000 is 6A per cent. and on
incomes of $4,000 on per cent?
In other words, our income taxation
10 more democratic than that Of any
other country in that the largest in-
comes are taxed much more heavily
and the small and moderate incomes
much more lightly than anywhere else
and incomes up to $4,000 for married
men not taxed at all.
90 1t is true, on the other hand,
| that on very large incomes-as distin-
guished from the largest incomes-our
income tax is somewhat lower than the
English tax, but the difference by which
our tax is lower than the English tax
is incomparably more pronounced in
the case of small and moderate incomes
than Of large incomes.
The "Excess Profits" Tax Here and
Abroad
Moreover, if we add to our income
tax our so called excess profit tax"
| which is merely an additional income
tax on earnings derived from business,
we shall find that the total tax to which
rich men are subject is in the great ma
| jority of cases heavier here than in
England or anywhere else.
a. 1t is likewise true that the Eng
lish war excess profit tax is so per cent.
| Qess various offsets and allOWances),
whilst our so called excess profit tax
ranges from 20 per cent to- 60 per
cent.
But it is entirely misleading to base
a conclusion as to the relative heavi-
ness of the American and British tax
merely on comparison Of the rates,
| because the English tax is assessed on
a wholly different basis from the Amer
lean tax
The American excess profit law ESQ
caIIed) taxes all profits derived from
business over and above certain
moderate percentage, regardless OF
whether or not such profits are the
result of war conditions. The Ameri-
can tax is a general tax on income de-
rived from business in addition to
the regular income tax. The Eng.
lish tax applies only to excess war
PROTESTANT is, only to the sum by
the profits in the three years preceding
the war, which in England were years
| of great prosperity. In other words,
the English tax is nominally higher
than ours, but it applies only to war
profits. The normal profits Of business
i e., the profits which business used
to make in peace time-are exempted
in England There, only the excess over
peace profits it's taxed. Our tax, on
the contrary, applies to all profits over
and above very moderate rate on the
money invested in business.
We Tax Normal Profits, They Tax Only
War Profits.
In short, our lawmakers have de-
! creed that normal business profits are
taxed here much more heavily than in
England, while direct war profits are
taxed less heavily.
You will agree with me in question
ing both the logic and the justice Of
that method. 1t would seem that it
would be both fairer and wiser and
J more in accord with public sentiment
If the tax on business in general were
decreased and, on the other hand, an
increased tax were imposed on spe-
cific war profits.
90 Our federal inheritance tax Is
far higher than it is in England or any
where else The ma Nimum rate here
on direct descendants is 271h per cent.
| as against 20 per cent. in England. In
addition to that, we have state in.
heritance taxes which do not exist in
England.
(6.) OF her total actual war expen-
ditures exclusive of loans to her al
| lies and interest on war lOans) Eng.
land has raised less than IS per cent.
by taxation (France and Germany far
less), while America is about to raise
by taxation approximately % per cent.
of her total war requirements (exclu-
| sive of loans to the allied nations and
of the amount to be invested in mer.
camille ships. which, being a produc-
tive investment, cannot properly be
classed among war expenditures.
We men of business are ready and
willing to be taxed in this emergency
to the very limit of our ability and to
make contributions to war relief work
| and other good causes without stint.
| The fact is that, generally speaking,
capital engaged in business is now
| being taxed in America more heavily
than anywhere else in the world. We
are not complaining about this: we do
not say that it may not become neces-
sary to impose still further taxes: we
are not whimpering and squealing and
agitating, but-we do want the people
to know what are the present facts,
| and we ask them not to give heed to
the demagogue who would make them
believe that we are escaping our share
of the common burden.