Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1921-05-03
MELONS TAX PLAN
ovERlooKS AVERAGE MAN
Secretary Of the Treasury's Revision
Program Is Dangerous Politically,
Since Il Does Not Directly Re.
IIeve Voter Of Moderate Means

Program Is Dangerous Politically,
Since Il Does Not Directly Re-
IIeve Voter Of Moderate Means
TNHE men with modest incomes. and there
L are more such than of any other eco
nomic group, have been hoping that the
Republican administration would relieve
them of some Of the burdens of the war
taxes
ConseQuently they will be disappointed
with Secretary Mellon letter to Chairman
Fordncy. of the ways and means committee
in which suggestions are made for a revision
Of the tax laws
The secretary Of the treasury proposes
rhr repeal of the excess profits tax and the
readjustment Of the income taxes to benefit
men with incomes in excess of $4,000; but
he makes no suggestion for the benefit of
the man with an income of $4,000 or $1,000
or $1,000. This man must continue to pay
the old taxes
He proposes II is true. to abolish the
taxes on soda water and men : and women s
wearing apparel. but he keeps the tax on
railroad tickets and tickets for theatres and
movie shows. These taxes affect millions of
people. They are a nuisance and an irrita-
ton.
While these irritating taxes are TO be pre-
served. the secretary proposes to irritate the
men Of moderate income still further by n
federal tax on automobiles. tax which
will directly affect 1000. 900 motorcar own
ers.
Politically the SeCrctary's plan IS most
disappointing 1t fails to take into account
the reason which led thousands of voters 70
support the Republican ticket last year
utr thot
thing be done to meet the expectations Of
the country by tightening the burden on the
greatest possible number of people.
II IL not enough to repeal the surtaxes on
the incomes Of the very rich, even though il
is true that those heavy taxes have ceased
10 be productive The ordinary man does
not think very far below the surface in eco
nomiC matters. When he hears that the tax
on his income is to remain unchanged. while
the tnX on the income of a man who re-
ccives every year from so, 200 to $1,000 900
is TO be reduced he is likely to dcnouuce the
administration.
The political phase OF any tax plan is
likely to be considered more seriously by
Congress than it has been considered by Mr.
Mellon.
If Congress can combine political wisdom
with sound economic theory in a plan to re
wise the war taxes it will come somewher
near doing what it ought to DO.
The Government needs revenue, but its
needs should grow less the farther We get
from the war. II is imperative that the
strctest economy be practiced by the ex-
ccutive departments and by the appropria
rion committees Of Congress But along with
economy there must be n rewriting of the
tax laws on a more scientific basis than
was possible when they were passed in the
first place.
There are many persons who believe that
the idea tax is one which is intended to
tax the dollar instead of the man who owns
the dollar: and that every dollar taxed
should bear the same burden. no matter
who owns IT, But the politicians are prone
TO favor taxing tho dollar Of the rich man
NJ higher rate than tho dollar Of the poor
man This is why there are heavy sur
taxes on large incomes and why Mr. Mellon
recommends that n surtax be retained that
will take 40 cents out Of every dollar of the
income Of man whose annual balance
amounts TO so 900 or more
The sales tax which comes about rs nea
as possible 20 n tax on the dollar. no mat
ter who spends it, is rejected by Mr. Mellon
| on the ground that it would tax everything
| including Ii" necessities OF life This kind
| OF ostrich reasoning should not be INDUCED
| in by any one who pretcnds to make tax
| proposals
Every economist knows that q small dircc
| tax on the necessities Of life is much lcs'
| bUrdensomc than direct tax on the pro.
| ducers Of the necesSurjes. We have haC
tax on tho producers for the last few yenrl
| and, according TO tn" figures compiled by th'
| Department OF Justice, it has added 23 PEI
cent TO the cost Of Thr neccssarics, and tht
| luxurics also. II has been estimated that
| direct sales tax Of per cent would not ado
more than 3L2 per cent at the outside to tn,
| retail price Of commodities.
! The notifications in the existing law sug
| gested by Mr.. Mellon will not bring the re
! hcf sought because they do not 60 10 rh
root OF the matter. His propositions invoy
continuance Of the unpopular taxcs-tha
is, taxes levied on special groups Of citizen
aud on special industries This system
| always works injustice, for it gives the met
! who pay tie taxes in tho first place a,
opportunity 10 unload them on the rest o
us and 10 make us pay rhr"c or four or toI
times the amount whicn they pay to III
| Government.
Il had been hoped tndt The oxocutiy
branch Of the Government would recon
mend tax reform based on sound cconomi
principles, but as it has not done 50 it re-
mains for Congress 10 what it can d
toward fulfilling the expectations Of III
people