New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1921-10-12

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shown a marked and constant TENDENCY
to yield a. acknowledgements Consider
ations of administrative expediency aMould
seem to dictate d favorable attitude
toward reduction in the rate. Much
of the same kind Of experience had been
had with the excess profits tax. As against
an estimated yield from this source Of
So, 900, 100000 in the fiscal year 1920, the
estimates for the years 1921 and 1922
are only $1,250, 00O,0U0 and $800,000,00o.
In fact the actual yield in the calendar
year 1921 may fall below $500, 900.
This decrease is partly due to the business
depression and the consequent fall 10
profits; but partly also to the shifting OF
investments to places where they are no
longer subject to the excess profits tax.
Moreover, tax experts who have been
concerned with the administration OF
this tax tell a story Of administrative
confusion, inequality. and complexlty,
which, they say, threaten breakdown
|of perhaps the whole income tax struo-
ture and make imperative. it's immediate
repeal. If this description is true, i the
enactment of the fat tax on the net IN n--
Ecomes Of corporations would. be desirable,
since this tax performs to an extent the
function required Of the excess profits tax
and in the next few years would prob ably
yield asslarger income than the excess
profits tax But before the excess profits
tax is repealed and replaced by other
taxes, every effort should be made. to
scrutinize it's administrative Deficiencies
and to establish beyond a doubt the neces-
sity for it's repeal. The remaining sources
of revenue proposed by the Secretary,
reminiscent as they are Of war admins
tsation, are not likely to receive any
larger support than they apparently de-
serve.
The important problems arising out of
Mr.. Melons statement, however, are
concerned not so much with the plan
for tax revision as with the estimates OF
federal expenditures. At the present time time,
the details Of these estimates, have not
been made public, but itlis) not probable
that they differ. substantially from similar
estimates publicly made in the past On
the basis Of such estimates, Some insight
can be had with regard to the places in
the budget where the most substantial
and least harmful cuts inaexpenditures
can be made. According to the last re-
ports from Washington, the final estimate
4 of $4,000, 100000 contains a. margin Of
roughly one billion dollars which is Of
la highly uncertain character. The gross
estimate includes, in the first place, az
appropriation Of S545,000,OOO for the rail.
roads. Already Chairman Meyer Of thu
I War Finance Corporation has told the
Ways and Means Committee that thu
I demands on the Treasury for this purpose
may fall considerably short Of thai
amount. The Treasury further expects
to realize during the year $3.50, 000;00(
out of war salvage; and believes thatsth
4 increase IN customs receipts over tn.
receipts from the Underwood Tariff ma,
amount to $7O,0O0,O00. There is also ;
faint hope that the postal deficit, allowed
in the estimate, will be converted into |;
surplus. No one believes that any o
. these sources will yield maximum re
turns. Even then, allowing for all pos
/ sible savings within this elastic margin, j
J, would seem di cult, if not impossible