Evening star., 1939-04-23
Mounting Tax Burden
Regarded as Drag
On Recovery
Termed Bigger Factor
Than War Feurs in
Present Slump
By J. G. DONLEY.

NEW 4O1t6A, AplA q W. Z. AL
The mounting tax burden continues
to receive an unusual amount of
attention In annual reports for
1888 and at stockholders meetings.
The conclusion undoubtedly is that
taxes have become a decidedly sore
spot In business calculations and
are viewed as a drag upon recovery.
How much the burden amounts to
has been brought home to stock
holders and employees by means of
estimates on per-share and per-
worker basis. At this weeks meet
ing OF Crucible Steel Co. OF America
stockholders, Chairman F. B. HUI
nagel went somewhat further and
put taxes on an industry basis.
He said that the major steel pro-
ducing units In 1929 would have
earned only about $4,000, 900 in
stead of $454 500 900, had 1898 wage
and tax costs applied at that time.
And, If 1898 wages and taxes had
been at the 1929 level, he estimated
that the industry would have con-
verted its $l4,90O,0OO loss into a
profit of about $780, 100000.
Scores Federal Policies.
Mr.. Hufnagel also expressed the
opinion that uneconomic taxation
and Government policies have been
a more potent factor in creating
the present business setback than
the unsettlement abroad. However
whether through information,
hope or belief-he said that the
trend toward ever-increasing Gov
ernment-imposed burdens upon in
dustry promises to let up, for which
reason he was encouraged ito look
forward with confidence"
AS sample of tax facts presented
In corporation annual reports, the
following, from the annual state
ment of the Electric Power e. Light
Corp. is highly Illuminating. and
also rather discouraging from the
stockholders viewpoint:
These taxes (taxes included In
operating expenses of the corpora
tion's subsidiaries) of $14,23lO44
were equivalent to $16.75 a share
on every share of preferred stock
OF Electric Power g. Light Corp.
outstanding at the end of the year,
and were equal to 989 per cent of
interest charges on all debt of sub
sldiarles held by the public.
Points to Big Load.
'Your corporation received s2-
2l6,o2l in dividends and interest
from its subsidiaries, but govern
mental agencies exacted nearly g..
times as much in the form of taxes.
The aggregate paid In taxes was
enough to pay salaries Of $1,40O
a year to more than 10000 employees
In governmental service"
Estimates Of tax ratios to national
income just made by the National
Industrial Conference Board indi-
cate that Americans paid a greater
share OF national income in taxes
IN 1888 than In any other year as
far back as records are available.
II we consider that the effective In
come. for the purposes of private
individuals and private business, Is
the income which remains after all
taxes are paid, 1t is obvious from
the boards figures that the country
was worse of in 1898 than in 1881,
even though its income before taxes
was $2,100, 100000 larger last year
than seven years before. The rea-
son for that lies In the fact that
all tax collections last year, were
a, 400 900, 900 larger than In 1881,
resulting In income after taxes
totaling some $4,000, 100000 less
than in 1881.
The following table, compiled from
the Conference Boards figures,
shows national income Tin billions)
before and after taxes, and the ratio
OF all tax collections to total ma
tional income for a number of re-