Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-06-22
TEXT OF PRESIDENTS ADDRESS
BEFORE BUDGET ORGANIZATION
Periodical Gatherings Rated of Surprising Value
to Nation-Financial Status of Federal Gov
eminent Reviewed by Executive.

lions are vital to the operation of
the budget system. Your co-opera
ton with the controller general is
essential.
AS natural sequence to the law
adjusting the compensation OF civilian
officers and employees of the Govern
ment the Congress has recently en-
acted a law adjusting their travel
allowances. This law provides ade.
quate rates of reimbursement for eX.
penses of travel. 1t does justice to
both the traveller and the Govern.
ment. The new law takes effect JUL
|, 1926. | wish to direct your at.
tention particularly to the provision
that any increases deemed necessary
to be made in the rates of actual eX-
penses or per diem allowances under
the authority of the new law shall
not be authorized by the heads Of de-
partments and establishments to the
extent of mourning a deficiency In APP
preparations during the hscal year
1927.
At this eleventh meeting of the
business organization OF the Govern
ment. II Is proper to recount briefly
the ACCOMPLISHMENTS Of these last five
wears in which your efforts have
played such a material part. 1t Is
for this purpose and to define plans
for the immediate future that we hold
these conferences.
Reduction in United States Debt.
On June 80. 1921, the public debt
amounted to $23,977 100000, carrying
an annual interest charge of $1,OlS.-
600 600. At the close Of this year the
debt will stand at approximately
$40 $50 .OOO. 900, with an interest charge
Of SS06 600 900. This shows since 1921
a reduction Of nearly four and one
quarter billions of dollars In the
principal Of the debt and nearly
s212 900 900 in annual interest. Our
expenditure, which for the fiscal year
1921 amounted TO $5,53S.000. 900. will
annroximate for the current year
So 500, 600 900, a reduction of nearly
two billions Of dollars. Taxation has
been reduced from $54.14 per capita
to S27.2S. This does not take into
consideration the revenue act OF last
March.
While these figures speak for them
selves, their real import lies IN the
influence which these reductions nave
had on the welfare and prosperity or
the people This influence goes far
hevond the material reductions | have
mentioned. 1t reaches into every
phase Of the daily lives of the people.
There are more of the necessaries.
conveniences and luXuries in the
homes Of the people, in the city ana
in the open country. because the GOV
eminent has let the people have more
Of the money they earn Tor them
selves instead OF taking so much from.
them in taxes.
Since the commencement or the
fiscal year 1921 there have been three
in
benefit of this joint executive ana
legislative effort to reduce Federal eN-
penditure has therefore gone directly
TO the people. At our meeting one
year ago it was my privilege TO state
that the fina ncial condition OF the
Government warra nted further tax
reduction. That forecast has been
realized in the revenue act or 1870.
The large tax receipts OF March 10
last show clearly that the country
ANTICIPATED a reduction in tax rates.
individuals who had undistributed
profits in securities and investments
took their profit under the expected
reduction of the surtax rate. 1t was
this same anticipation of tax reduc-
ton that prompted investment In pro
ductive business OF capltal "nlch
would otherwise have gone into tax
exemDt securities. The great increase
in revenue was due in large measure
to the unusual prosperity in the year
1925. but the confident expectation OF
a reduction in rates was an important
factor in this revenue Increase
Relief Under Tax Cut.
The 1926 act relieved some 100000
people from paying any direct tax
and reduced the tax burden OF all
other taxpayers. General prosperity
Is the aggregate Of the individual
prosperity OF our citizens, To permit
the people to retain more of their own
earnings is to increase their savings
and purchasing capacity. which as
sures prosperity. In 1921 the income
tax of married person with no de.
pendentS and a total net income or
S.. 900 from salary was $50; in 1923 1t
was 81 SO: in 1926 1t Is nothing. For
single person with an income or 5000
from salary in 1921 the income tax
was sl2O: in 1928 1t was $3.50; while
In 1926 il Is only $16.SS.
Miscellaneous war taxes were also
materially reduced. These taxes were
levied under more than so categories.
which are now reduced to five. This
removes In large measure the sO-called
nuisance taxes which have been found
so Irritating to every one. The revenue
from these taxes Is reduced by about
$275. 900 600, and there are no COM
pensating increases as In the case Of
the income and profits taxes.
Incorporated business has been bene-
fitted directly as well as indirectly by
the repeal Of that tax based upon the
value Of the capital stock OF the cor
poration. Many concerns with not one
dollar Of profit were obliged to pay q
large tax. This was unfair, as the
ability of a corporation to pay depends
upon its profits. Fully 40 per cent Of
the corporations making income.tax
returns have no profits or taxable in.
comes. but under the old law they
were obliged to pay.
What the complete result of the
1925 tax law will be is still a matter
of estimate. The correctness of the
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