Pullman herald. [volume] (Pullman, W.T. [Wash.]) 1888-1989, 1922-02-17
FEDERAL TAXATION
MERITS ATTENTION
Edwin 4. DUmmcicr, Instructor in
Sociology and Economics, Talks
to Taxpayers OF the
County

| fore the meeting of taxpayers of the
county held last Saturday at Colfax
was delivered by Edwin F. Dummeier,
instructor in sociology and economies
at the State College. Mr. Dumoeier
said, in part:
Federal taxation merits cur at
| tention as much as state and local
/ taxation Where the state is spend
| ing millions, the federal government
is Spending billions Most of this is
TO pay the expense Of the war. so the
matter of expenditure to that extent
is beyond our control, but the ques-
tion OF how revenue is to be raised
to pay these billions of dollars is
matter of most vital interest to every
taxpayer
"At the present time. mostly be-
cause of our constitution which was
adopted over a century ago, it is
possible for persons of enormous in
| comes running into millions to en-
tirely escape paying any income tax
by investing in so-called tax exempt
securities These tax exempt securi-
ties include all securities of state and
local governments, and also federal
farm loan bonds
High Income Rates
! "Our federal government has plac-
ed very high income tax rates on
these large incomes, under the old
tax law running as high as 70 per
| cent, and under the new law recently
passed as high as 80 per cent of the
total income. But because people
who are supposed to pay these high
'rates can invest in these tax exempt
securities. they pay no income tax
on the portion of their income from
that source. whatever.
The only way to change this sit
uation is by an amendment to the
| federal constitution The only way
to get such an amendment is for
the people to let their congressman
know that they want it. 1t is there
fore a matter of education,
1T is true that the fact that these
securities are tax exempt makes it
possible for them to be sold at
| somewhat lower rate Of interest than
they would otherwise bear. In 9TH
er words farm loan bonds under the
! system now in vogue can be floated
little more adyantageously than if
! they were not tax exempt, but the
advantage in the better market for
| these securities resulting from their
being tax exempt does not begin to
make up for the loss that is suffered
by the federal government in that
the income from them is not tax
/ able
Liberty Bonds and Farm Loans
ITO anyone who doubts this !
would say it is only necessary to
compare the price which liberty
bonds, which are not tax exempt, are
bringing on the market. with the
market price Of the exempt farm
loan bonds There is certainly no
gain sufficient to make up for the
loss suffered by the federal govern
ment being unable 10 collect any in
come tax from income derived from
these securities.
Attention has been called in this
tax meeting to the need OF greater
economy in the expenditure of our
( public moneys. That there are OPP
portunities and that there is need
for such economy no one can well
deny However, it is impossible to
. escape taxes.
'If we are TO have good schools
and good roads we must have taxes.
For myself I can say that ! have
lived in sections of the country
where people We're so unwilling to
tax themselves as to have very poor
roads and very poor schools. I have
also lived in parts of the country
where people We're sufficiently de
airous Tor good schools and good
roads as 10 be willing to tax them
. selves reasonably in order to have
them And 7 can very positively say
that with the equal resources the
country which is willing 10 tax itself
. reasonably for The support of good
schools and good roads is the more
prosperous The Increased intelli-
( gence and productiveness resulting
are worth the cost.
General Property Tax
Practically all tax money in the
past has been raised by the so-called
/ general property tax. Presumably
this has been levied on all kinds of
+ property: real estate stocks. mort
4 cages, cash on deposit in banks. cook
4 stoves, cats and dogs-at a uniform
rate
'As a matter of fact practically
all this tax has fallen on real estate.
+ There are reasons Why this has been
0-r . 4,