New Britain herald., 1920-12-08
liNGJNE TAX CHANGE
 IS RECOMMENDED
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are mentioned for the 1nforrnatfo of congress" Mir. Houstur. says. IVY htfe I shalI hot attempt to discuss them, attention should be esllad- to the-Aew and additional consumption taxes. Reasons have been given for the be- lief that no valid objection exists to the employment of a moderate num-
 Der of consumption taxes properly selscted, but it would. in my opinion, Dc neither wise nor expedient to in Crease radically the volume of con- sumption taxes. The hrtfcleg inelad- ed in the suggested lfN of additional consumption taxes have not been selected because their use is pafticus larly harmful or in any sense less legitimate than thos6. not included. Consumption taxes must be. judged by practical standards, What should be sought are few consumption taxes which tap the Surplus income which is being wasted, not on con- glomerate multiplication of petty taxes upon every orticle of luxurious pr unnecessary consumption which can neither be clearly defined, cheap ly collected nor administered without widespread evasion"
 Ask Soda Tax Repeal.
 The repeal of the tag on .oda fountain and other beverages - -ss asked. the secretary says beoause me collection Of the tax, the aggregate or which is small. has presented an administrative problem of magnitude. Added to that Mir. Houston says thrre mas been constant and wiaesprrad evasion of such taxes. -
 The excess profits tax, Mir. Houston declares has not fulfilled the theoroti- cal grounds upon which it was on. acted and has been found 10 be wrong both in theory and in political philos. ophy. He says it discriminated against the copservatively financed corpora- ton while aiding materially the firms whose capitalization IS cxnureratrd. He urges that it be replaced by some form Of corporation profits tax mot only on the grounds of the govern ments revenue needs but upon ground or equality and justice" The corpora ton profits. tho secretary continues. should not be allowed to escape with n tax of 10 per cent while other tax payers are subjected to taxes on their incomes ranging as nigh as 70 per cent
 Rigid Economy Necessary.
 @s's Ahosotoh urges InG nGCeg- sity for rigid economy in government expenditure. asserting that only by conserving the fionces carefully can the expenditures be kept within the annually which he sug- gests should Dc the basis for a reve- nue program. He is hopeful, however, that with "heavy burdens placed by the Transportatioh Act' out of the way. there will be a substantial ex- cess shown by government receipts over government expenditures.
 An analysis of the government ex- penditures for the last fiscal year de- velops the fact that almost one fifth of the $6.400. .000. 900 paid out was spent in connection with the federal control and the guaranty of earnings for the railroads. Oniy one department of the government-the War Depart ment-spent more than was used in connection with the carriers. The War Departments total. tine record shows, was s1.611.0o0.0o against sl,o37, ,0oo,- 900 for the railroads.
 War Debt Payments
 Discussing the war debt and a pro- gram for its retirement. Mr. Houston says that within the next thirty months the government will have to pay off approximately 37.5oo. 100000 in Victory notes. war savings certifi- cates and treasury certificates of in- debtedness. He proposed that the treasury certificates not be funded fur- ther: that they be retired as rapidly as the treasury's conditions permit SO the pronram for redeeming other gov ernment obligations will not be hamp- cred by simultaneous payments.
 Mir. Houston tells Congress that the heavy payments required by the Transportation Act had "disarranged the governments fiscal plans" but he believes early spring will witness hnai settlement of the claims or the rail- roads under the guarantee provisions and that the treasury then can pro- ceed with its previously announced program of meeting ana retiring tho War Savings certificates, amounting to $500, ,00o. .o00 and the Victory Note issue which asgregates st,so0,ooo.- Il 900.
 Throught operations of the sinking fund, use of the small repayments by foreign governments on loans. and the employment of certain salvage returns to the treasury, it has retired a,Ts4.see,150 in bonds. Mir. Houston says. saving s1oo.ooo.o00 on the transactions by buying in the open markets Of the amount purchased, bonds agVregating s119,10s.oo0 were retired from funds repaid by the for eign governments.
 Lessons Of the world war, MT. Houston says. have shown the need for the transfer of some of the treasury activities to other depart ments. Five bureaus. War Risk In- m .r.lA DVNtxr Islx