Evening star., 1921-02-13
RY I. A. FLEMING.

Bf i. 4. FLEMING.
Wherever business men discuss con-
ditions today the income tax is the
dominant subject. Tariff. re-adjust-
ment, money. disarmament and all
other subjects are secondary to the
question of taxation.
Every one seems to admit that the
national revenues will be greatly re.
duced during the current year; that
the loss of internal revenue Will pe
further accentuated by the decreased
earnings of individuals and business
firms and corporations.
dividuals came through the year l92o
with a profit on the right side OF the
ledger. If they did the return for tax
alton will be materially reduced py
the reductions for losses sustained IN
one way or anoth er. SO that the reve-
mos rnust of necessity be leSsened.
MANY who have heretofore paid in
come taxes will make no payments
at all. The stock market is to blame
for much Of this. 1t may be lues-
ton whether a man has a risnt:
moral, even il legal. to go outside of
his legitimate business for a specu-
lative turn and thereby make Uncle
Sam a participant, so that he Will De
out his just and proper income TAX
in the event Of the speculation prov
lnR
Hundreds of millions Of dollars have
been and will be deducted from the
income returns for 1929, just because
of these speculative losses. Every
exchange from New York down had
its prolonged selling periods. selling
10 cake losses" for the revenue laws
insist that no paper loss counts. The
actual sale Of stocks must be made,
immediate repurchase being possible.
with all matters incident to sale and
delivery of securities being neces-
sary.
One thing tax reformers agree upon
the excess profits tax is iniQuitous.
1t is sitting development in that 1t
absorbs the extra money made by
corporations and individuals. as well
fixed amounts. THE present method
Of taxes penalties thrift" says one
authority, and the assertion meets
with general approval. 1t was needed
during the war, but the war is over.
And the large incomes. when the
slaughter began, took refuge in tax
exempt securities"
Tun-0ver Sale.
One after another business organi-
cation has come out in favor of the
sales tax.
The Music Industries Chamber of
Commerce is the latest exponent of
the sales tax. This organization.
InTOu8u d SpcCIdl COIuiuitLCcs olc1S
one new thought in the obligation on
all persons of age to make report of
income, and that a minimum tax OF
IS be imposed on all who receive an
independent income.
Then the commodity sales tax of
one-haif of per cent. payable
monthly, although the sales tax gen.
orally advocated is placed at / per
cent.
One authority would do away with
the IS tax and would not ask returns
from business doing a gross business
of less than $500 monthly or sales of
$1,000 annually to be exempt.
The added 1 per cent to the cost Of
goods would be just like that much
more clerk hire or other expense"
Every merchant would, under this
system. get on the government books
through the payment Of 81 annually.
reporting aggregate sales monthly.
for through the annual inventory
when reporting income tax of the
merchant
Farm Loan Bonds.
The Senate has gone on record as
favoring the Treasury'S buying $5,-
100000 farm loan bonds pending the
settlement of the case now before the
sale Of bonds and the subsequent
loans to farmers. One senator sug-
gested that the tax-exempt securi-
ties would get into the hands of the
very rich.
This very sentiment is more than
likely to result in legislation before
very long that will prevent the issue
of any additional tax-free govern
ment securities: Some rich investors
in seeking for tax-free investments
cost them heavily.
nuAeou Oh CoHnamv
At the recent meeting of the Dudeon
Oil Company, company chartered
under the laws Of West Virginia, the
following were elected directors of
the company: William L. Burkhardt.
II. NJ. Foster and E. G. Scherr of this
city: e. a. Duncan of Pulaski. Va.
and Henry Lauer of Oakland. Nd.
William L. Burkhardt was chosen
president; c. A. Duncan. vice presi-
dent; r. n. Foster. secretary: Henry
general manager.
The company has purchased an oil
and gas lease covering territory in
the most productive gas and oil re-
.gions Of Virginia.
ForejEn Exchange In EnGllsh.
The Shawmut National Bank makes
eign exchange:
Authorities have repeatedly ex-
planned that the present low rates of
foreign exchange are not some mex
pilcable phenomenon conjured into
international bankers. Rather are
these rates a reflection of existing
economic conditions in the various
countries: not disease in themselves.
but a symptom of national i'll health
These statements are truisms: but it
seems that many Americans have not
yet realized that the price which
bankers will pay for given currency
d. e.. it's exchange rate) depends in
the long run on the power to purchase
currency may possess. Thus pro-
spective tourists. hearing that 25 lire,
more or less. may be had to the dol
lar. delude themselves with pleasant
visions of afi1uence for life in a villa
at Fiesole-on the proceeds OF a couple
of liberty bonds. Less sabiy.
American business men appear before
congressional committees, raising an
indiecrminate outcry against the
perils OF foreign competition. The
value may be related to or even
caused by "a low domestic value has
not occurred to them.
Yet experts tell US that the relative
price levels of two countries d. e.. the
relative purchasing power of the re-
spective currencies) are the funda-
mental basis of exchange quotations.
The ratio Of exchange between any
two countries is normally determined
by the ratio Of their general price
so oncisely phrased by the chairman
of the London Joint City and Midland
Bank. to our readers' attention. 1t
means-to take the United States and
italy for specific example-that the
lira is quoted at 4 cents because. as
far as can be judged, it buys in Italy
what cents buys in the United
States"