Omaha daily bee., 1920-12-16
NEW TAXES: NEW METHODS.

lax about new sources OF taxation or
revenue for public uses is fundamentally idle.
Income seized by the government for its pur-
poses has but the one source; it finally is taken
from production. This is elemental. However the
tax may be applied in one or another way,
tapping the general reservoir OF created wealth
in different spots, and that is what engages at
terton just now. 1t is always highly desirable
70 extract the needed money from the producer
with as little pain to him as possible. So novel
methods of achieving the same results are al
ways in demand.
One thing is apparent to all: The only hope
for lessened taxation is in reduced expenditures
The country is slowly emerging from an era Of
reckless extravaganza, public and private, and
feels the qualms that come in "thc cold gray
dawn Of the morning after" If resolutions now
being made are held to long enough, recovery
will be prompt and good health will soon be
restored The body of the nation is vigorous,
sll that is required to found and support pros
perity exists and when the rock Of resource is
touched by the wand OF labor, wealth,will gush
forth, just as it has done always. But taxes
must be paid to support the government. and the
situation of the federal exchequer is such that 4
very large sum will be required every year for
an indefinite time, to meet obligations and de-
fray actual expenses OF the government.
The existing method OF collecting taxes is
becoming irksome. When the emergency Of war
demanded that an unprecedented sum Of cash
be secured by the federal treasury, several
makeshifts were employed. 1t was not expected
that either would operate with exactness, and it
early became apparent that some lamentable In
Justices were inflicted under the law Of 1917.
These were in part remedied and in part per-
petuated by the law Of 1919. which still governs.
These measures produced the revenue, but also
brought forth much grumbling. Most OF the
criticism is directed at the excess. profits tar,
which in considerable degree has defeated its
purpose, because it has been open to miscon-
struction and has permitted some very repre-
hensibie practices.
Whether the substitution OF a sales tax for the
prohts tax will have the effect sought is not
sure; it is being carefully considered. and the
fact that some Of its earlier advocates are now
but lukewarm in its support or actually opposed
10 il does not argue that It lacks merit That IS
! common experience in the search for painless
methods Of taxation, Secretary Houston recon-
mclQSl
jumped from 4 to per cent, an increase OF one
half; other brackets to receive similar but not
equal treatment. It has been proposed that the
limit be set lower, but this does not receive much
fayor. Heavier tariff imposts on imports will
be OF some assistance, but this source OF revenue
can not be relied upon. A sitter rate OF eorpor-
atio, tax, and levy on the undistributed prohts
win be considered, The latter plan offers So
luton for the stock dividend, under which con-
siderable proportion of earnings have SO Tar
escaped the levy
The fact that at least a billion dollars of tax
Is suspended in dispute between the government
and the taxpayer over what is due indicates the
imperative necessity OF clarifying some portions
cf the revenue law, 1t is the biggest job be-
fore congress, one that demands the most care
fill consideration, and on the solution of which
depends in large sense the permanency OF busi-
utss recovery.