The Rathdrum tribune. (Rathdrum, Idaho) 1903-1963, 1922-06-02
Cost of Collecting
Income Taxes
BY Congressman Guy U. Hardy

Washington.-What does it cost to
collect the federal income and inter-
nal revenue taxes?
What proportion of your tax dollar
paid in goes out for cost Of collec-
ton?
These are interesting questions Of
ten discussed Guesses are freely
made and usually run high. In, Colo
rado, on the trains, and In Washing
ton 1 have heard many people make
guesses.
can now tell you nearly exactly
what it costs to collect a dollar of
taxes because 1 have looked the mat
ter up.
But most people who think they
know much about it, know nothing at
ALL
l have amused myself often by pin
ming folks, who make wild assertions
about the cost, down to actual figures.
Out home many guessed that it costs
taxes. The other day at luncheon
with half dozen congressman in the
House restaurant the subject came
up. When pinned down for definite
estimate the guesses ran from 10 to
25 per cent. One gentleman said the
cost would be about 2 per cent and he
was laughed at heartily.
SO much to indicate the general I'M
preston and popular fancy.
Facts in the Case.
Well, here are the facts in the case:
In 1921 it cost 81 cents to collect
each 500 and in 1920 it cost only 90
cents for each $1O0 collected. In 1920
only about one half of one per cent
and in 1921 less than one per cent.
AS a matter of fact it did not cost
that much because much of the ex-
pense charged as collection expense
was really for enforcing the child
labor, narcotic and prohibition laws.
These items are included in the ap-
preparation for running the internal
revenue department and cannot be
easily separated without going into
greater amount of mathematical CAL
collation. than l care to tackle at thls
time. Any way, the figures show that
the cost of collecting the tax is not
anywhere nearly as great as most
folks think it is-and when you re-
member that we dump the whole cost
of enforcing national prohibition into
the expense it makes 1t sound quite
inconsequential indeed.
Here is the way we arrive at the
figures. The internal revenue depart
ment collected for the fiscal year lSzo
a total of S5,4O7, $780, ,251.S1. The total
cost of tbe internal revenue depart
ment, including the enforcement ol
the laws named for that year, was
S29. .647, ,439.71. You can work out
little problem in percentage ana YOU
will find that So hundredths OF one
per cent is about right-or % Genus
for each $1OO collected. o.
Eiqhty-seven Cents for Eacn $1oo.
For tbe fiscal year 1921 the totai
COLLECTIONS through this department
was s4595, 900, 1854 and the expenoi,
trros for all purposes mentioned
$40 2O3, ,z16.74, which is 81 hunoreu'ns u,
of one per cent or ST cents for eacn
500 collected. .oss,hla
II would be practically imposslple
to fgure out exactly what the COL
lections process alone costs. Ihe men men
,uho work at the job have a variety
of duties to perform and IL aii sUe'
IN on the days work. But consiuel
inp the vast amount of work ana & ene
variety 1 Of duties performed by tnese
,,sar which have nothing to do WIN
Collecting collie of the taxes yet is incluoea
IN the expenditures quoted above II
90 nan he seen that the estimate OF from
IS cents to 81 cents per $loo 10 ~
liberal indeed.