Evening star., 1936-10-04


article in The Star is made possible
through the courtesy OF the Prori-
dence Journal.
INDIRECT and unnoticed taxes
have become most impor-
tant and highly controversial
L item in American costs Of liv-
ing. Imposed through tax struc-
ture that has grown in a ram
bling. politically expedient and gen.
orally unco-ordinated way. they start
usually with the harvesting of every
raw product and pile up steadily until
the consumer pays the aggregate with
his purchase of the finished article.
Their existence has been a favorite
topic of political discussion, with con-
troversy centering about their amount
and responsibility for their existence.
To establish a reasonably accurate
estimate of the amount. something
which has never previously been estab-
lished, the Providence Journal made
an interesting l2-month study Of
three families below the income tax
level. From September l, 1885. to
September /, 1896. these families ac-
counted for virtually every penny spent
in any way and a special research
staff checked each Of these expendi-
lures to determine as closely as pos
sible the exact tax payment included.
The three families chosen were
thrifty and for the most part avoided
luxury expenditures upon which the
highest taxes are levied. One family
had no automobile, two families had
no telephone. None ever went to
moving picture show at which the ad-
mission cost was more than 40 cents,
the point at which the Federal taxa
ton begins. The total liquor bill for
all three families for the entire year
was $3.50.
In the case of one family. the study
definitely traced 14.39 cents Of every
dollar to taxes. In q second case,
the tax bill was 11.35 cents per dollar.
In the third case, it amounted to
1913 cents. The average for the three
was 1918 cents per dollar. In con-
nection with some expenditures, how
ever, it was impossible to determine
the tax and when these expenditures
were deducted from the totals it was
found that the average tax was 14.74
cents for every dollar spent.
No Income Tax Included.
In the case of one family no taxes
at all were shown for expenditures
totaling $628.50. If this group of ex-
penditures is deducted from that fam
ily's total expenses of $2,43099 and
the tax bill is applied only to those
items on which taxes have been fig
ured. 1910 cents of every dollar spent
was found traceable to taxes. SINH
larry, IL from family No. 2 expendi-
lures of $2,561.63 the $221.5o for
which no taxes were figured, is de-
Quoted, there Is tax percentage Of
1912 instead of 11.35. In the case
Of family No. 3, deduction of the
$2926s on which no taxes were shown
raises the tax percentage from 1913
to 1913. This gives an average tax
Of 1474 cents on q dollar.
None Of these families paid in
come taxes; their direct taxes were
relatively small and the record here
with given clearly classifies them In
the low tax group.
The three families were those Of:
Fred Green, annual income, $2,764.so,
family consisting OF Mr.. and Mrs.
Green and their 13-year-old daughter,
q student at Q junior high school. The
family owns q two-family house, each
fiat having five rooms. They live IN
one nat and rent the other. They In
vested their savings in the present
home, which they purchased when
prices were high and the family IN
come much greater than it is now.
Then they earned together about $50
q week, both being textile weayers.
Now as inspectors in silk mill, they
earn together less than half TINS
amount.
They find that their present income
Is no more than enough to MAINTAIN
. decent standard of living, even
though it Is supplemented by'rent from
Al