Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1920-12-29
c. FREDERICK c. STOUT
On Our Taxation Problem

A T A time when the United States faces
"A the most critical economic period in it's
history. one of the biggest and most acute
problems II has to face Is that Of taxation. III
the opinion Of c. Frederick G. Stout. leather
merchant and tax expert. who was formerly
a director Of the War Industries Board.
Something must be done. and done at
once" said Mr.. Stout, "but the question is,
What?
1--WE must realize that our prime duty
right now Is not to spend more money. but
to consider how We can spend less. Sec
ondly, We must devise some plan whereby
We can raise money to pay our enormous
debts and take care Of the most essential
needs of our country.
Then we must be honest with ourselves
In considering this matter. q point that is
quite as important as either of the others.
We must have peace. that we can go
about the business of reimbursement with some
degree Of security; and we must have some
tions. which II it accomplishes nothing else.
will aim TO restore the trade balance of the
world.
1T seems to be a generally accepted belief
that the United States has unlimited wealth ;
and so she has, in the ground and other
places. But the hard fact remains that
today our available wealth will not take care
OF the expenditures which we are making.
During the war and following the armi-
stice, for one reason or another. to provide
was at various times greatly inflated We
finally, as was inevitable came to the end of
II. and then We had to defate. Rut in that
process We face great dangers, and we have
by the imitation method created vast debts
which now must be reckOnod with In n
word. II we face 1t honestly and squarely
the present situation is n critical not to say
desperate one.
War Debt Of S24, 900 ,OOO, 900
AT the present time We have a war debt
Of twenty four billions Of dollars, ten bill
lions OF which represent loans to foreign
powers In view Of their present financial
conditions we can we'll regard this money as
debt for some time TO come Then we can
add to that from three and one half to four
billions of dollars which is owed 70 us by
foreign powers for goods that they have pur-
chased from us and which they have been
unable to pay for. For the same reason as
in the foregoing case, we can safely regard
that also as part of our debt. With a few
other things considered. We have a national
debt Of upward of thirty billions of dollars
to begin with.
In view of this situation can only OK.
press the hope that We will have some wise
legislators in Congress who will realize that
We must Curtail and cannot continue to hcad
toward economic destruction
After exhaustive consideration of the
ta&auoh problem j have once more come
back to the belief that the only practical
solution Is tax on sales. or transfer Of
title, to be paid by the buyer.
II realize that there is no proposition to
which there will not be objections and some
difficulties arise in our intricate cconomic
system of making il 100 per cent wOrlahic
However, 1t is an economic fact that il nokns
no difference where a tax il placed or how
1t is collected it is borne BY the consuminc
public unless the tax is coniscatory Of can
ital. Or we might say it is paid either hv
the ultimate consumer or taken our of thr
economic system This fact has been cannon
haged IN every conceivable way by those who
may have some special interest at heart and
others "h" may have som" ax to grind.
Sales Tax Safest
The amount of this tax could be regulated
from any fraction of l per cent up to INV
maximum that would give the rrouirrd
amount of money which the federal govern ,
mcnt must have and which We all nrknoui
edge II must have. 1t could be- collected nv
means OF stamps or by quarterly returns,
aud | believe this tax would be Tho sofost
most practical and most direct mctLoJ o"j
one that would be susceptible to thc Iao,t
abuse and collected with the least cxDcnsc
This tax should also take urcolInt nf rho
various processes that occur In the s0Ir of n
finished article, and the tax placed IN cao%
one. 1t would, incidentally have n trndnnc,
to regulate speculation automatically TTj
tax, together with the income tax farm"
the principal taxation source Of rcyrnur f"r
Canada at the present time, and the rxnc"i
m"nt 40 far seems to have brrr cminrntIy
satisfactory. "'''
the income tax, but ! do bclicy, il sh9uid hn
modified over its present form. ~
The present excess profits tax is nm
n C-tion OF the first UU; litv. :, = "a, -,