Pullman herald. [volume] (Pullman, W.T. [Wash.]) 1888-1989, 1921-04-15
TRYING TO SHIFT THE BURDEN

Senator Smoot of Utah is leading q
fight in congress to substitute sales
tax for the present excess profits
tax. This is simply another attempt
on the part of those whose profits
are large to shift some more of the
tax burden upon the shoulders of the
ultimate consumers, whose profits
are small or nil. 1t needs no argu-
ment to prove that sales tax will
come out of the pockets of the people
who buy the goods, 1t is self evident
that sales tax will simply be added
to the cost of the article sold.
1t is argued that this is a fair tax,
because it will reach many persons
who do not now pay any taxes. This
is true, but it will also hit every
small taxpayer and all the people
who are least able to pay taxes.
1t is also argued that the suggest
ed tax of one per cent would impose
such light burden ind would be so
we'll camouflaged that it would not
be felt. This is a specious argument
because the one per cent will be null
tiplied with every transaction be-
tween the manufacturer and the ultl-
mate consumer, so that by the time
any article is taken home from the
retail store the sales tax will have in
creased from one per cent to five or
seven per cent. This assumes that
only the exact amount of one per
cent will be added to the cost price
each time the article is transferred
from the manufacturer to the broker,
from the broker to the distributor,
from the distributor to the whole
saler, from the wholesaler to the re-
taller and from the retailer to the
ultimate consumer. Each handler of
the article will be tempted to use the
more than one per cent to his sale
price and some of them are almost
certain to yield to the temptation, so
that when the article finally passes
over the counter of the home mer-
chant, the tax will very probably
have increased to 10 per cent or
more.
Assuming, however, that an article
passes through but five hands before
reachinp tho cOpcu,,,or ond +h,+ 30 ~
one adds an exact tax of one per
cent, this would add five per cent to
the cost to be paid by the consumer.
Suppose the family expenditures of
this ultimate consumer are $500 a
year. This would impose an annual
tax of $50 upon his shoulders.
There is no escape for the con-
sumner, The tax will increase the
cost of everything he buys. Take
bread, for example: one per cent will
be added when the farmer sells his
wheat to the grain company. another
per cent will be added when the
grain company resells the wheat to
the flour miller, another per cent
will be added when the miller sells
the flour to the baker, another per
cent will be tackled on when the bak-
er sells the bread to the storekeeper
and the storekeeper has to add an
other per cent when he sells to the
consumer.
What advantage is to be gained by
substituting this kind of tax in lieu
of the excess profits tax? 1t is
claimed that the latter tax discour-
ages big business and imposes an I'M
just burden upon the heavy taxpay-
ers. But the tax comes from those
who are best able to pay it. If they
are extorting unreasonable profits
from the people, it is but fair that
their greed should be curbed by COM
pelling them to contribute large per
cent of those profits to the support
OF the government. To allow them
to retain all of these excess profits,
by shifting an increased burden OF
taxation upon the ultimate consum-
ers, would be an unfair and reaction
airy policy against which the people
OF the United States should raise a
prompt and emphatic protest.
WIN. GOODYEAR.
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