The Washington times., 1921-07-05
TAX PROBLEMS ARE
GREATEST WORRY
Of HARDING REGIME
Administration Will Drop Excess
Profits and Big income
Levies, Says Hapgood.
~ NORMAN HAPG00D.

The Administration IL more wor-
ried about taxation than 1t 10 about
anything else. This fact was COM
mented on to mo by the managing
editor OF the New York American.
who sat behind me at the nght on
Saturday.
"why don't you give US more on
the subject Of taxation" said he.
with his trained journalistic sense.
As nobody was hghting just then
except some Of the prslims, whose
relative grogginess was no concern
of mine. ! plunged into the philosophy
Of the subject.
II will tell you why" replied.
II have already written on the sales
tax. which IL the present center of
controversy. Your editorial writer's
are all sure the sales tax 10 the right
thing. I am not. Having indicated
as much I have not seen the use Of
crossing the wires too much"
"Oh WELL" said he, that has moth
ing to do with It. That Is another
department. We want to print all
sides Of the situation"
TWO CHANGES SETTLED.
That is intelligent, liberal jour-
naIism," said i. IT will take another
shot at the whole tax situation. and
perhaps the editorial writers can
then use my head for q punching
bag"
Some things are settled. The ex-
cess profits tax 10 going to be drop
ped. So are the highest reaches OF
the income tax. Business men as q
whole are highly pleased with these
two decisions. and they argue that
capital will begin to flow more free
tx txHn n
made.
So We need not worry ourselves dis
cussing those items. They are not
bringing in much now anyway and
dropping them will not be felt In the
result, though II will be used next
summer in the campaign.
The sales tax question has to be
decided before Congress can 60 on
to its estimates from other sources.
VIII 1t accept the principle Of that
tax or will 1t not? That question in
its turn depends on another.
WANTS TAX ON RICH.
Those who defend the sales tax say
that any tax IL passed along to the
consumer. That has been. q contro-
vsrtal question ever since Jacobs
nearly a year studying taxation. in
preparation for some lectures I gave
at Yale, and for q subsequent book.
came out OF that study with my
mind open at the top, IL not at the
bottom. Prof. e. r. A. Seligman, as
we'll known an authority as there Is
in America, went down to Washing
ton and testified that It 10 not true
that taxes are all passed along to the
consumer.
Senator Smoot. who Is the protec-
- ~ Co
economist hard. but Professor Selig-
man countered on the Senator'S Jaw
with what looked to me like damag-
ing effect. II I were Legislator l
should not be willing to give up try
ing to make taxes hit the rich unless
I was in the neighborhood OF 81 per
cent sure / could do 1t.
A WAY TO ECONOMY.
That is one great point. The other
Is not so much talked about. but
have been hearing great economists
discuss It lately. The sales tax Is
praised because It can be collected
without making anybody vince.
The economists to whom I refer
say that is one reason they are
against It. They do not want tax
that goes down easily. They want
people to holler over taxation.
tHcy kuinh' 10 cApoNe-
CANT enough already. II II discovers
a tax that won't be howled over 1t
will be still more extravagant.
One OF the most dangerous aspects
Of the sales tax, according to these
Philosophers, Is that when 1t gets
going at i per cent and the people
get used to it, Congress can simply
double the amount whenever 1t wants
more money and get 1t, with no
yelping.
/ have my own ideas about how
to raise money, but having let loose
this trouble making article I am 30
ing TO sit still few days and see
what happens to me. Then l may