The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1922-03-05

| nGtOU, ~. -
only those income getters who use
their money as spendthrtfts."
But, professor, the beauty OF the
income tax is that 1t is graded.
Those who are poor are exempt.
Then after the taxable income Is
reached the rate increases progress
sively with the larger income"
Individual Thrift.
my dear man." he answered.
you. the journalist. are talking
theory. I. the professor. am talking
practice-how the taxes work. The
| income tax is graded only according
to the ability to lie and conceal. You
say the sales tax Is not graded. In
] Canada we exempt from its operation
nearly all foodstuffs and all fuel.
Those items. along with rents and
simple clothing. are the expenditures
of the poor.
"Three-quarters Of their expendi.
lures are not touched by sales
tax. Not half Of what rich man
spends is exempt. He who buys
many things pays large annual
tax. He who buys few, pays q small
| H. III
spring suit last another season, you
can economic on your tax also. The
sales tax tends to encourage indi-
vidual thrift, the income tax tends
to break II down.
| "You pay your sales tax when you
are able to pay It. when It is con-
venient. That Is proven by your
making the expenditure. No one
comes and takes the sales tax from
you when you are not looking; the
income tax falls on you like a thief
in the night. The sales tax Is taken
from you in small amounts like swal.
lowing castor oil in a generous glass
Of orange Juice"
did I understand you to say that
you thought the sales tax would aid
business in the United States and
reduce unemployment"
Would Aid Business.
why, yes" he answered. 'It
will II you let the sales tax take the
place OF some OF your income and
business taxes. But today in the
United States people are not putting
their incomes into productive enter
prises. They are putting them into
tax-exempt bonds. Why? Because
money put into these bonds isn't
taxed and the return is sure. There
Is no risk. The same money put
into enterprise runs a risk. 1t may
be lost.
eff there is a gain. along comes
the Government and takes IL away.
Corporation or other business
taxes and taxes on personal income
have come to be so high that indus
trial investment and expansion are
halted; business is stagnating. 1t Is
a leading cause OF unemployment.
A sales tax in place OF part Of these
income and business taxes would
start business like a cop straighten-
ing out traffic jam on Lafayette
street."
The professor evidently knew his
New York.
Then. you think the income and
business taxes are tapping business
harder than they are tapping the
incomes of the rich?"
Tapping business?" he inter.
rupted. They are blackjacking IL.
You as a New Yorker know what
that means, black lacking it."
1T may he true; ! haven't heard
Of it," l insisted loyalty. But, pro-
lessor. we couldn't raise any ap-
probable sum by a sales tax without
making the rates so high that 1t
would be unbearable."
Tax Is Not Felt.
you are wrong" he said. you
say you have talked with business
men here. II so. you have learned
that neither business nor consumers
feel our Canadian sales tax. 1t Is 3
per cent. The dominion budget for
the current year is 1927 900, 900. The
sales tax was designed to raise $70,.
600 900. and II is running at about
that rate. So we raised over 20 per
cent OF our revenue with this tar
although, as ! told you, most Of the
poor mans purchases are tax
exempt. How much must your
Federal Government raise in taxa
tion?"
About $500 million dollars" !
answered quickly. 1t was one OF
the few figures carried in my head,
He eyed me suspiciously. well,
II that figure of $500 million Is cor.
|, rect YOU would raise over 700 million
by per cent sales tax, judging by
our own experience. Conditions in
Canada and the United States are sc
similar that 1t is fair to compare one
with the other"
Best Plan For U. s.
Then you think. professor"
said, that the sales tax ought to
be a part. of our national tax sys.
: tenn"
Certainly I think So" was his
reply. 1T is Just a question OF
Congress finding out what this ta1
really is. When they find that
they can raise over a billion dollars
by a tax whose operation. as ex
perience proves, will meet with nc
opposition from business or con
= sumers-why. how can they help
adopting It? II there is anyone
that must be looking for a painless
tax at the moment. 1t must be your
American Congress. Tell them to
> look across their Northern Dor
: der"
That was all. had had a pain
I less lesson in the economies OF
taxation. called a sleigh, which
Is MontreaTs Winter taxi. We
= slipped down hill to my hotel.