Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1920-11-30
INCOME AND AID VALOREM TAXES.

The Special Revenue Commission has recon-
mended flat income tax of two per cent, with
exemptions identical with those of the federal in
come law
The journal does not desire at this time to
commit itself the support of such course
Many features-legal practical and equitable
enter into what should be done. The matter should
have profound and sympathetic study. The public
may well retain open mind during the period
of discussion.
We do wish to address ourselves, however to
a few of the arguments advanced against an in
come tax, There those who contend that the
addition of income tax to the regular ad
valorem property tax is double taxation" that is,
that the property is first taxed and then the in
come from it is taxed.
But does taxing the property and then the in
come constitute double taxation" in the sense
intended to be conveyed? Let consider con-
crete example: a.. has sufficient property In
ratio to all the taxable property of the state so
that his proportion of all the money to be raised
by taxation would be $1,000 On straight ad
valorem basis his tangible property would then
be assessed to pay $1,000
Suppose, however, that two bases OF taxation
were used one ad valorem and the other income
If "A" were so taxed that the ad valorem produced
$500 and the income another $500 he would be
paying two taxes but total of not more than
his share namely, $1,000.
Much can be said in favor of this double sys-
tenn "a" with large non-ncome- producing prop
erty would pay high ad vaorem tax, but a
comparatively low income tax. "B" with smallet
property holdings but larger income, would pay
lower ad yalorem tax but a higher income tax.
Or again. assume that "a" and "B' each have
property worth $500 but f"A' receives no in
come from his property while "B' receives a net
income of IS 900 from his. Each will then pay the
same amount of ad vaIorem tax but "B' will pay
d,1it ia n
to be a factor in taxation, this is just
Or again. "A" has $4,000 in property which
pays him no income while 'B" has practically no
property but receives salary of $4,000 per year
If there is no tax "a" will bear the burden
of both for the support of the state Yet "B" has
police protection, schools and other benefits for
which he is able to pay and should pay.
Again, "B' has notes, bonds and mortgages
which produce for him an income of $4,000 per
year. Either these intangibles should be sought
out by any inquisitorial method necessary to get
them on the tax roll else the income derived
from them should be taxed. The latter is prob
ably more effective and less obnoxious
We will later discuss graduated income tax
and review the reasons given by the commission
for discarding it for the present Again, in that
case, it would that if ability to pay" is to
be considered that the tax should be graduated if
possible.
tax cannot be successfully levied on the ex-
elusive basis of benefits received" The benefits
received vary from year to year. according to cir
cumstances, as for instance, when troops are
maintained in a community during time of dis
order to prevent destruction of life or property.
A few then receive great special benefits at the
expense of the state.
Another example of this is the case of poor
man with large family receiving the benefits of
the schools. lie cannot be taxed according to
benefits received"
We are almost inevitably thrown back on the
theory of ability to pay as the largest factor in
determining the tax to be paid.
Yet there is practical wag to make this an
absolutely equitable basis. The man with non
liability to pay" as the man WHOSE property Is in
come producing if to take ability to pay
and convenience in paying equivalent terms
The law must simply presume that the ownership
of the property is proof of liability to pay the
tax on it. AS a practical matter taxes some
times so difficult to pay that a man cannot con-
tinue to hold the property and must sell it at
1 sacrifice or against his wish to hold it.
ut would seem, therefore, that to make part
and the balance upon income, would tend to
4 equalize conditions and produce fairer division
OF the burdens in proportion to the ability to pay
No likes to pay taxes but it is poor sports
manship and poor Americanism to try to shift it
the other fellow. All should seek honestly for
the farest possible basis in the spirit of Sinking
no duty but refusing to be imposed upon without