Indiana daily times. [volume] (Indianapolis [Ind.]) 1914-1922, 1922-02-21

de TctiOns, was 22,437, 6S5,825.
The statement of the Government that
no country collects its revenue at SO low
a cost is misleading The Governments
estimat ed cost 800 will be much high
er this year than last, but that is only
a small item in the real cost to the tax
payer.
Nobody in Washington knows the in
come tax in ali its phases. No one on
earth knows 1t or ever will. Interpre-
tations of the law are SO changing That
the Treasury Department issues Al new
book every week on new rulings on the
tax.
There are tremendous costs Of which
the Government takes no account.
The biggest item is what you have
to pay ia work or money to prove to the
Government you do not owe what 1t
says you do. In this there enters vari-
Gus details Of time, paper, Investigations.
lawyers charges, hearings, postage, court
fees, tax experts. appratsals. etc.
The government assumes thar all tax
payers are dishonest. In many cases they
are able to prove their contention In
many more they are not. but the burden
Of proof is on the taxpayer and, If the
Government is in error, the taxpayer
y
Here is an example in the case Of
small corporation The Government sent
two agents to examine the books. They
claimed SlOJ 90 additional tax was due
When they departed the president II the
corporation had to engage experts and
lawyers TO dispruva their charge. They
did but they had to wade through
mountain Of papers. After that there
was voluminous correspondence. The
Government confessed it was in error, but
It cost the corporations 80 70 prove
# didn't owe the sos 100 There are
thousands Of cases like this each year.
/ The cost should be on the Government
when 1t makes the error, but the cost is
! put on the taxpayer.
@ ONE Of the fees lawyers get out Of
- Of these tax cases are staggering.
The income ,9x has been boon 70 The
legal fraternity. but q horror TO the
business man
Occasionally the Government ahandons
q case because 1t opens up such a stu
pendous amount OF work One year Il
sent four men to cheek up one item in
the inventory Of the United States Steel
Corporation These men reported that Il
would take the entire force OF the New,
York Office of the Internal ReTenue De-
partment SIX months 70 get that one
item Strengthened ont. That item was
only one OF twenty Eve in the corpora
TONS Inventory.
One Of the worst elements In the whole
/ tax situation IS that OF doubt. There is
+ no certainty Of the return you make teiug
right Decisions on various questions are
subject TO change Within 9 few weeks
there Is to be Issued a new volume Of
| regulations. This probably VIII be soc
or more pages.
/ n he rule OF reason does not apply
L to the income the corporation or
any other tax. Under the law OF 1915
provision was made for INVENTOR
losses" Congress. approaching there
would be a big drop Ia values. made
provisions for adjustments TO wipe out
paper profits Despite the intent Of
Conrrss the Internal Revenue Depart
meut held r,gidly that absolute proof OF
loss in every item had TO be furnished
One corporation had 1900 items in its
Inventory, but had 70 pay horrible total
tax because it did not have the original
bill TO prove It's loss In each and every
one Of the 1900 items
No matter how scrupulOus Won may be
you are not safe II the Governu ent
challenges your return it does not admit
possibility OF error on its part. but puts
upon you the burden Of proving your
innoceuse Under the law you have 90
ray the tax IN fun before you can bring
suit to get any Of il back. Then II the
court decides in your favor the Govern
meut may offer to compromise or il may
appeal The Government rarely pays auy
attention TO adverse decisions in lower
courts disregardlng everything Of that
sort until the case finally gets 10 the SU-
ureme Court Of the United States. That
means years Of delay. Also II means eI-
rense tar lawyers and for other things
not the least in time worry and the loss
of pSe Of your money. Then, II you
finally win the question is to collect.
There are unpaid claims against the Gov
eminent dating back IN the Civil War and
lots of them dating back to the Spanish
American War.
Taxation never was popular and never
win be. But II could be made less
hurdensome and less costly n there were
more Of reason and OF Justice in tax col
lection methods.-CopyrighL 1922 by
Public Ledger Company.