Norwich bulletin., 1921-04-28
RfeiFenaan.
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 RsfsFe.Asn.
 Fellow Members:
 In order that the Norwich Chamber of | Commerce shall obtain the sentiment of | the membership feiatiVe to national tax | ation, We are enclosing 6 referendum on | various phases of this problem. The re- ] suit will be sent to our representatives in congress, as indicating the sentiment of this community.
 Of necessity, the explanations Of vari- cus taxes now under public discussion. as anording means Of reiikf from the bur den of our national tax laws, are brief. The democratic and republican platforms in the recent elections stood for re- vision of the present tax laws, which un- doubtedlY will be repealed. Bat some form of taxation must be devised to pay the enormous cost of the European war.
 It is hoped you will consider these phases of proposed tax laws and send your ballots to the Chamber of Commerce office not later than May l. -
 In order to be counted. ballots must be received at the Chamber of CommeFee>of-. flee on or before May l.
 By order of the board of directors.
 A. J. BAILEY
 A. MITCHELL. JR-, C. J. TWIST. Committee. Excess PVeAts Tax. The present excess profits tax was de- ] signed to reach those of wealth and large incomes. It is pfedicatsd on the principle l that all profts over and above per cent. on invested capital are -inordinate or ex- cessiye prohts. The basis for calculating the excess profits tax is invested capital \ NRMr rsa11 | on earnings above s per cent. and 40 per cent. on all earnings above 20 per cent on this invested capital. AS a result of | this system, statistics show that an extra cost of IS per cent to 40 per cent. ii added to almost every article purchased Its effect has been to increasethe price oi the Recessitie sof hfe an average of 23 pei cent. Furthermore, it has the tendency tt drive capital away from business into ta, exempted securities.
 Simplicity Tax.
 The simplicity tax, known as the sale or turnover tax. is plan to levy z pc cent. tax on all sales of services or com nodities. The amount of this tax can b readily figured from the total sales o each month. It would be collected iron the sale of raw material to the manufac turer, upon the manufacturers sale 0 his product, upon the jobber's sale, an 80 on down to the final tax of l per cent to the consumer. It could not be avoid : ed. It does not depend upon profits, whic are always very difficult of anticipation 1t will attract capital fVsm tar exemp , sencurities to industry and general bus ness It is not an experiment. It ha l been in successful operation in the Phiiiy
 pines for Is years. Its effect on tn ? price Of the neeessiti6s Of fife would b to lower the tax from 25 per cent. to
 fair average of 1-2 per cent. , Retail Sales Tax. The retail sales tax is a plan to lev { taI-upcn only one sale-the final sal to the consumer. It eliminates sales : capital assets and sales of services. Tn tax might present great difficulties in a, | n1inistration in determining what are T,
 tail sales or sales for consumption, t use. Such a tax would probably be s c additional tax. to which would be add, n lthe pyramided profits tax of all the pr [ Lceding handlers of the goods. The "a
 would necessarily be high. large rev y nues were required. and the principle e protecting the consumer would be viola
 ed. The cost of administration of tn d tax, because of the unreliability of ma = ing returns by various classes of reta Y CTS, would be very high. In all probab 1t ity this tax would be much higher tn: l. the estimated average of 3 1-2 per cer : of the simplicity.
 ExeaPtisns.
 > Present tax exemptions of a 900 f ,. single persons and S2,e0e for married DC sons are a hardship fer those of sm incomes. Persons of small income nS 'n mally spend from so per cent. to 1se ? ls cent of it for living expenses. ineludi rent It permits large incomes to entir, p escape taxation because of investment
 lnon-taxable securitiea In the former Cd
 it violates the principle of ability to D - taxes. Therefore. persons of small K come should be given fair considerati' = especially because the purchasing pow of the dollar has decreased mere tn -a half This increased exemption wo, x, eliminate the small dealer and the ma ., percentage of the farmers, who wou z however, pay their share of taxat d through indirect taxes on the neeessit es of life.
 nd ssrsaxes.
 e. The present personal income tax. VII
 bearing heavily on moderate Incomes. p
 mits very large incomes to entirely he cape taxation, because of investment ch non-taxable securities. The rate of le. on income, therefore, should not exc nt the point at which the taxpayer can
 reasonable return on investment ITS taxable securities. Any rate of tax cir yend that point win ezuse investors in gradually dispose of taxable securi Ire and replace them with non-taxable sec, lat ties, thus creating cias of non-taxp 10 CTS. This practice of investing la Iat sums of money in tzx.free securi 'p- withdraws large amounts of investrr nc. capital from industry, railroads and D eft lie service corporations. It Ia estims ,ht that s14,e75,eoe. 900 are TOW invested
 tax exempt bonds.
 nd As far as known, the local chambei
 the only chamber in the state that
 taking the referendum at the pre-,
 time. Organizations that have or I'D taking refeTendums on the taxation pi
 lem include the United States Chan old of Commerce. tha Boston Chamber or Commeree. the National ilT. foods \ cut chants association. the Ealo1aI CT ~, sas association and the National BusiI 'I- Mems Tax league.
 The