The New York herald., 1921-07-25
A Dry Revenue Spending Tax.

ASt :" SPShuAhS tuA WniCu udS ln
considerable merit not only of di
rectness and simplicity but of beins
designed to take the place OF taxes
which have been oppressive ant
dangerous and are now becoming un
productive.
But Mr.. MrLLs's otherwise unob
jectionabls measure. failing a sale,
tax, has, it is to be feared, in tn,
form he has constructed it, the finan
cial defect OF being perfectly goot
tax which would not overburden tn,
Treasury with revenue. And thu
Treasury needs the money.
The Mills spending tax measure
can be as simply explained as i
could be simply applied. Nationa
taxpayers would be relieved of tn,
excess profits levies and the incom,
surtaxes, the normal tax remaining
The progressive but slight spending
tax-it takes only 5000 from a hus
bands spendings of $4,000, ever
when none Of the following exemp
tions was claimed--would not be i'm
posed on personal spendings below
$4,000 by those without families Of
dependents and below $4,000 by tn,
heads Of families. This to all intent.
and purposes would make immun,
the 80 $40 per cent. of the Ameri
can people who do not spend more
than $4,000.
But there would be various exemp
tions as follows:
Section 342. That for the purposes
of this title the term 'spendings'-
"(a) Includes all personal living
and family payments, disbursements
and expenditures actually paid by or
on account of the taxpayer in money
or moneys worth, except those spe-
cifically excluded in this sections but
sob Does not include the follow
ing items, which shall be exempt
from taxation under this title:
I'D All the ordinary and neces-
sary expenses and costs actually paid
during the taxable year in carrying
on any trade or business, including a
reasonable allowance for salaries or
other compensation for personal SER
vices actually rendered and including
rentals or other payments required
to be made as a condition to the con-
tinued use or possession, for purposes
of the trade or business, of property
to which the taxpayer has not taken
or is not taking title or in which he
has no equity:
"(2) All taxes actually paid within
the calendar year, including taxes as
sessed against local benefits of kind
tending to increase the value of the
property assessed, but not including
spendings taxes. and other taxes paid
on or in respect to services amuse-
ments or commodities used or en-
joyed by the taxpayer or his family;
"(S) Contributions or gifts:
"(4) Amounts actually paid dur
ing the taxable year for medicines.
medical and dental services, and nurs-
ing on account of sickness of the
taxpayer or any person chiefly depen-
dent upon him for support;
"(5) Amounts actually paid dur
ing the taxable year on account of
funeral expenses
"(6) All amounts actually invested
during the taxable year in deposits.
loans, securities and real estate, but
not including interest on unpaid bal
anoes amounts actually paid during
the taxable year on account of the
purchase OF one home for the use of
the taxpayer, not including interest
on unpaid balances, shall be deduc-
tible as an investment il neither the
taxpayer nor the wife or husband OF
the taxpayer, as the case may be, al
ready owns home; other payments
on account of the purchase or i'm
pTONtIneHL OA Itdi tSldte Slidli uOt De
deductible unless made for invest
ment and not for living purposes
"C7) Premiums actually paid dur
ing the taxable year for insurance on
the life of the taxpayer, including
health. accident and disability in
surauce."
These very extraordinary exemp
tions might easily make the great
mass of Americans spending up tc
$4,000, even $4,000, wholly exempt
Furthermore, those with good sized
incomes might be virtually exempt UP
to many thousands of dollars, because
large incomes are not so much
spent" by those having them as they
are invested in the very things which
fall within Mr.. MrLLs's exemptions.
Now, with 100000 wage Garner:
out OF work and many big incomes
of yesterday melted away like a
spring snowfall under blazing sun
It is not easy TO estimate how Amer
lean spendings to-day are bulking
But one thing is certain: The peo
pie of this country. tax exemption
or no exemption, do not and cannot