Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1920-12-09
WOULD INCREASE
TAX ON INCOMES
And Eliminate Excess Profits
and Certain Luxury Taxes
-HOustOn's Suggestions

l
period of four years. and including an
| Increase of two per cent in the taxes on
| incomes up to 5000, is urged by Secre-
| tary Houston in his annual report sent
! to-day to Congress
repeal OF the excess profits taxes elm
| nation OF certain of the so-called luxury
taxes, including the levy on soda foun =
tain and similar beverages, and a re-
adjustment OF the rates in the higher
groups Of income taxes. IL proposed by
the treasury chief To meet the losses
brought about by these proposed changes
Mr. Houston recommends revised and
new taxes to yield about 81 900 600 600 as
follows
tax OF % per cent on corporation prof
It's distributed or undlstributed. in addi-
ton 10 application of a higher surtax rate
to yield $3.50 UO0.O0
An additional tax OF six per cant On cor
porntion incomes to Yield SfG5 600 900
Readiustment of surtax rates on in
comes TO yield an additional $3.50 900 900.
Abolishment of the S2Om exemption al
lowed corporations on income to Yield
$4,000
An increase from the present four per
cent to six per cent In the tax on incomes
OF so'UO or less and from eight per cent
70 IL per cent in the tax on Incomes DO
tween &,Wn and $1,000 the whole esti-
mated TO yield sl5O.94o.0O0 annually
A tax OF two cents a gallon on gasoline
Vfor motor cars and all other purposes. to
yield $4,000 900
A federal license tax OF % cents per
horsepower on the use Jf motor cars TO
yield 10OOOO.OOO
An additional sales tax on automobiles
tother Than trucks and waeons) and
motorcycles and motor car accessories to
yield slOOOOO.OOO
zen per cent additional tax on thea
trical admissions to yield s70OOO.OOO
An additional tax of 81 per Thousand on
cigarettes to Yield 100000
An additional tax of Is cents per thou
sand on cigars to yield 100000.
An additional tax Of 6 cents per Mound
OF tobacco and snuff to yield $s.OW,UO
An additional tax Of five per cent on
candy to Yield s2OOOO.0oO
An additional tax of seven per cent on
chewing gum to yield $2,0OOOW.
An additional tax of seven per cent OH
toilet soap and toilet soap powders TO
Yield A.0OC.Opo
"A III per cent tax on the sale by manu-
Iacturers, producers or importers of per
fumes, cosmetics and medicinal articles
IN lieu OF the present tax on the con-
Sumer to yield $IO.0O0O0O.
An additional five per cent tax ON low.
e'ry and precious metals to Weld 80, On
OUD
An additional tax OF five per cent on
musical instruments TO yield $4,000 1000.
An additional tax Of five per cent on
motion picture films 10 Yield 100000.
In the reimbursement of surtaxes. Mr.
houston proposes the division of incomes
n
On the former class he would lm,, the
highest tax to 20 per cent while the in
come spen, would be subjected to A tax
between 5000 and 5000 would be taxed
two per cent on the part saved and the
same on the part spent. The same ratio
with graduated Increase would apply TO
Incomes up to $4,000 where the maximum
OF ~ per cent on saved income is reached
From 5000 to $4,000 the rates would be
~ per cent on saved and 81 per cent on
spent; $4,000 TO $4,000, 20 per cent and 20
per cent: $4,000 to SIS 900 % per cent and
30 per cent; $4,000 to $4,000 70 pcr cent
and 40 per cent and over 100000. 20 per
cent and 30 per cent or a total OF 20 per
cent
The present maximum is 70 per cent on
incomes OF SI.00O.0OO but Mr.. Houston
declares it has long passed the point Of
Its minimum productivity" since il en-
oourages the investment in tax-exempt
securities. He says the only effective
way to tax the rich is to adopt rates that
do not force investment In tax-exempt
securities"
The new rates while not laying as high
n levy against the great incomes will
the secretary expects, produce a greater
return TO the government since the
al t.rill fi,>,l
TO invest in bonds OF States countries or
municipalities which are ,es-sxempt IN,
pay a lower rate Of interest,"
'These possible SOURCES OF incona ara
mentioned for the Information Of Con-
sress' nv Houston asys white I shan
not attempt 10 discuss them, attention
should be called 70 the new and addition
al consumption taxes Reasons have been
gwen Tor the hel!ef that no valid obtec-
uon exists to the employment of mod
crate rumber OF consumption taxes prop
e'lN salectoo. but II would. In my opinion
he neither Wise nor expcdient to increase
radically tho volume OF communication
taxes. - The articles included In tho
suggested list Of additional consumptioS
taxes Fave not been selected because
their use is particularly harmful or in
any sense less legitimate than those not
incinced. Consumption taxes must he
Judged by practical standards. What
should be sought are few consumption
taxes which tap the surplus income which
u being wasted, NOT a ccnslomerate
Of petty taxes upon every
a'tcle or luxurious or unnecessary con-
which can neither be clearly de-
fined. cheaply collected nor administered
without widespread evasion"
the repeal OF the tax on SODA fountain |
ana other beverages Is asked. the secre-
tarN says, because the collection OF the !
tax. the aggregate of which IL small has |
presented an administrative problem OF
magnitude. Added TO that. Mr. Houston
says there mas been constant and wide !
spread evasion Of such taxes
The excess profits tax. Mr.. Houston de- |
clares, has not fulfilled the theoretical |
GROUNDS upon which II was enacted and /
has been round to be wrong both in |
theory ana In political philosophy. He
says II disseminated against the conserv-
'tiVeiS financed corporation while aiding
the firms whose capitalization
Is exaggerated. He urges that it be re-
placed by some form OF a CORPORATION
proi'ts TAX not only on the grounds of
the governments revenue needs. but up
On the grounds of equality and Justice"
me corporation profits. the secretary
continues should not be allowed to en-
cape with tax OF 10 per cent while other
lax payers are subjected to taxes on their
incomes ranging as high as 70 per cent.
STANzA DEFINED
In Bliss Perrys new book. "A Study
" Poetry" he raises the question ~