Evening star., 1925-06-28
Q,rS. PLANS FISCAL
|pOL|cY AS MODEL
Winston Tells Maine Bank.
ers of Treasury Plans.
!. Calls for Tax Reform.
" the Associated Press.

By the Associated Press.
BAR HARBOR. Me, June 27.-
The Treasury is endeavoring to eS.
tablish a fiscal policy that will stand
as "a model for other governments in
the avoidance of friction with and dis
turbanCe to business, Undersecre-
tary Winston declared here tonight
in an address before the Bankers
Association of Maine.
The Treasury official explained the
operation of the policy for dealing
with the gigantic public debt. a legacy
of the war, and sought to show how
the vast refunding was done without
upsets in the money market. 1t was
possible. he believed, to handle all
Government finances with the same
freedom and on that basis urged the
bankers to support what he regarded
as the next step-reform in taxation.
Tax Reform Needed.
The future policy by adoption of
which," Mr.. Winston said I'VE can
obtain less friction in Government s
relation to its people, and. therefore
better government. is that of reform
In taxation. Taxation is the power
of the State to raise money that the
State may live today and every day.
The purpose of taxation is. not only
to acquire a revenue this year, but
to keep the fields of revenue ferti-
lized and plowed so that we may have
assurance of crops of revenue in
years to come.
The most important principle of
taxation Is, then. taxing system that
will preserve and not destroy the
sources upon which 1t must feed.
With estate taxes which confiscate
40 per cent of the capital, we are
fnp 10 4.
taxes that reach 46 per cent, we are
not letting our crops come to ma
turity. In both lines we destroy the
sources of revenue by killing the in
centive to production of more wealth
or more income to replace that taken
by taxation.
Want Minimum of Friction.
I'm other words, we want a taxing
system which operates with the mini
mum of friction and still meets the
money requirements of the Govern
ment. AS we approach the realiza-
ton of such an ideal. capital will get
out of unproductive investments: in
dustry will return to normal chan
nels, and taxation. unburdened by
waste of collection, will produce for
the Government more nearly what the
taxpayers give up. When such a re-
form is accomplished we will
indeed be able to give you better gov
ernment by less government"
Mr.. Winston digressed TO discuss
fiscal policies of the French and
British governments. The latter. he
said, has lifted itself from the post
war financial mire. has its currency
on sound basis and its taxation re-
duced to a scientific and orderly basis
He compared that with the tax rate
In France. absorption of more than
half of that governments income for
payment of interest on it's public
debt. and a generally strained finan-
cial condition.
I'VE must look forward" he con-
tinued 'to France balancing its
budget. refunding its foreign debts and
stabilizing its currency, and so re
establishing its credit as actually to
save money in the transaction.
Through sound policy. and only
through such a policy. England has
been able to command the unexcelled
credit necessary to protect it on the
restoration of the gold standard. Such
policy pays"