Great Falls tribune., 1921-04-27
THE SMOOT SALES TAX.

THE SMOOT SALES TAX.
THE Republican politicians are
! seeing ghosts these days when
they contemplate new taxation
schemes to take the place Of the
excess profits tax and the large
income tax percentages levied on
great incomes. They are agreed
that these must be repealed for
sound economic reasons, one of
which is that they are drying up at
their source as revenue producers,
and soon will disappear intirely as
such revenue producers through
driving all big incomes out OF pro-
duction employment and into tax
free bonds. The Smoot sales VAx
of one per cent is really the most
sound from an economic stand
point and the least Objectionable,
but then It Is most dangerous from
a political standpoint, and the av-
erage senator and congressman
doesn't give a tinker's word Of
profanity for economics when It
comes to a question Of getting or
losing votes. Not many voters
have much knowledge Of political
economy, but they respond quickly
to the charge that "Wall Street.,
or the ''big interests" are having
their taxes reduced and the COM
mon people" having their taxes in
creased. The Springfield Repub-
lican does not believe the Smoos
sales tax will be put through, not
because it is Objectionable from an
economic point Of view, but be-
cause it would give the Democrats
too much campaign material. 1t
says:
Whatever the economic mer-
it's Of the sales tax may be, the
political merits Of it promise
to control Republican policy.
President Harding, it is now
felt. sounded the doom OF the
sales tax in his recent address
to congress. in saying: The
country does not expect ana
vi will not approve a shifting OF
burdens"
Congressional leaders like
Mr.. Mondell express the same
VI idea more epigrammatically in
saving that the people demand
"a lifting, not shifting, Of the
tax burden" Inasmuch as Mr..
Mondell, the house floor lead
er, and Mr.. Fordney, the chair
man Of the house ways and
means committee, and Senator
Penrose, the chairman OF the
senate finance committee. unite
in repudiating the sales tax,
Senator Shoots sales tax bill,
providing for l per cent tax
on all sales Of commodities. and
commodities only, faces an un-
promising future.
The politics Of the situation
could hardly leave the polite
ally-minded in doubt. If a
congressional election could be
postponed for five or six years,
the Republicans might easily
agree among themselves to put
through the Smoot bill, but
there can be no escape from
a congressional election next
wear. That means, in case the
sales tax were enacted, dan
gerous campaign cry for the
Democrats to the effect that
the party in power had shifted
the tax burden from the RICH to
the poor. For there are num-
erous economists of solid repu-
tation ready to argue that
sales tax, being tax on con-
sumption, is unjust and anti
social because it amounts to a
direct tax levy on the every
day consuming needs of the
masses and bears no proper
relation to the taxpayers abil-
ity to pay. ..........
That such a tax would look
like a mere shifting of the tax
burden does not need to be
proved to a politician. It 50
happens, that in any event, this
congress is to repeal the ex-
cess profits tax and the higher
surtaxes on large individual
incomes concession to the
demands of the business men
of the country. The enact
ment of sales tax at the same
time would be coincidence so
conspicuous that il would prob