Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1920-03-23
DEMAGoGUES SHOULD
CONSIDER THE DUCK
Then They May Begin to Under.
stand Why Shoes Cost Three
Lines Their Enrnnr Price

times tnelr FORMER frlce
THE duck is equipped by a beneicent
L Creator with an automatic oiling
device which enables il to live in the
water without getting its skin wet.
When one reflects on the failure Of
the legislative devices to compel the
business man to pay heavier proper
tionate tnx than is levied on the man
who works for wages or a salary, one
is forced to the conclusion that some
power has provided the business man
with tax shedding device as efficient
as the water shedding equipment of the
duck.
The men who framed the income tax
law thought they had arranged to com
pei the man of large income to pay a
Tax as much larger than the tax paid by
| the man of small income As his income
was larger than that of his less for
tunate fellow citizen. For example, a
man with an income of $10,00O must
pay tax of $3.50, or S.3 per cent, and
man with an income of 81 ,000,00
must pay a tax of SOB ,030, or more
than 20 per cent. 1t was reasoned that
he would have almost $780, 900 left,
which was enough to keep him from
want.
But the man with the big income has
paid the tax in the first place and
charged it up to the cost of operating
his business and has added enough to
the prices at which he sells his product
so that he has his old income of 81 ,000,
600 still unimpaired. Instead of adding
$703, 900 to his operating costs, how
ever, he has to add S2,333 900 if, after
paying 40 per cent tax. he is to have
81 .O0O, 900 net profit left.
And this is undoubtedly what has
happened in many cases. The manu-
facturer has made the jobber pay the
income tax and the jobber has added to
his cost of operation the income tax
which comes from his net income and
passes that along with the manufactur-
er's tax to the retailer, and the retailer
increasing his profits enough to leave
his net return unimDaired, passes on to
the consumer mis- own tax, the tax of the
jobber and the tax of the manufacturer
The ultimate consumer has to pay all
three taxes, and if he is salaried man
or if he works for wages he has to pay
in addition the tax on his own income,
which he cannot pass on to any one else.
Among the many causes said to be
responsible for the high cost of living
this is one of the most potent. If one
were so disposed one could carry a soap
box to the City Hall plaza, mount it
and denounce to a sympathetic and ap-
| plauding audience the villainy of the
retailer, the jobber and the manufac-
turer. But it would be as profitable to
denounCe the law of gravitation, the
procession of the equinoxes or the recur-
renee of the tides.
Taxes, in whatever form they arc
levied, arc n charge upon the cost of
operating any business just as really
as wages and the price of raw materials.
II wages go up prices rise in proper =
ton. If the price of wool goes up the
price of wooden cloths rises at once
Whatever expense Is incurred in the
manufacture Of any product or in the
conduct Of any business must be re.
fiected i'm the price Of the thing pro
duced or dealt in. Otherwise the bust
ness man is unable to meet his expense.
and he must 90 into the bankruptcy
court.
The point of these remarks is that
relief from the high cost of living is &c
be found not in denunciation of so
called profiteers so much as in a re-
vision of the income tax law in such d
way as to prevent piling the cost OF
government upon the shoulders Of those
least able to carry it.
This must be done by cutting down
the excess taxes on large incomes, by
resort to consumption taxes and by a
revision of the tariff in such way as TO
make it primarily revenue producer
and incidentally a device for protecting
! American industry.
Conditions have changed radically
/ during the past five years. We have
/ piled up an enormous war debt, which
| places burden of at least billion dol =
! lars a year upon the country, and the
/ normal expenses of the government have
/ increased with the growth of the coun
try and with the shrinkage in the pur-
/ chasing power Of the dollar.
| Revenue is the first thing to be con =
sidered in every tax law. In the first
| seven months Of the current fiscal year
nearly two billion dollars worth OF
| goods were admitted to the country free
| of all duty. The value of the dutiable
goods was only 1892 900, 900. We col
lected $40, 900, ,OU0 on the imports, or
duty on the total imports equal to
| only 6.2S per cent ad valorem. These
are the figures given in the monthly
summary of foreign commerce issued by
the Bureau of Foreign and Domestic
Commerce in Washington and apt
official. T.
Our present tariff law is not piH
| ducing the revenue which the countr,
needs. Without in any way interfe tinl
with the ability of our foreign debtor
to pay in goods for what they Lav,
bought from US, it will be possible I,
raise several hundred million dollar
more through the custom houses than a
present if a deliberate attempt is mad,
tO'levy revenue tariff. The sunl woult
go long way to make up for tn,
amounts that would be lost by a re,
vision of the income tax law. And tn,
taxes paid at the custom h1use woulC
be so slight that the general consumer
would not feel them.
But there is another robson for re.
duCing the income tax aa large for
tunes which should not be overlooked
The present tax deterE men of larg,
wealth from investing yheir money il
real estate mortgages aud the securities
| i. u l.