Evening star., 1942-03-24

ship with other prices fair to the
farmer, generally considered to be
parity. Profits must be permitted to
increase In depressed industries to
reasonable return on the capital in
vested. After the excess has been
eliminated or recaptured or pre-
vented, we can consider the question
Of taxing the normal income and
profits that remain.
Favors Sales Tax.
The second principle I suggested
was that every one would have to
pay something to the war effort. I
don't believe there Is any man.
woman or child in the United States
who isn't willing to make substan-
tial contribution out of his income
In the shape of war taxes. Under
the Treasury program Federal taxes
will amount to 20 per cent Of the
national income, and I believe they
should amount to at least Is per
cent. The Treasury proposes to
take 10 per cent from any one with
an income Of 100000 and 80 per
cent OF the income OF the very
wealthy. I believe this is. drastic,
but not unfair In this crisis. But 1t
seems reasonable to me that every
one, man, woman and child, should
pay from per cent to 10 per cent
Of his normal income as a war con-
tribution. This principle is the
justification for q general sales tax
or general Withholding tax, which
I shall discuss in a moment. The
Treasury still resists any such tax,
but Mr.. Roosevelt himself admits
that we must face It sooner or later.
He said In January, "All through the
years Of the depression. I opposed
general excise and sales taxes, and
I am as convinced as ever that they
have no permanent place in the
Federal tax system. In the face of
the present financial and economic
situation, however, we may later be
compelled to reconsider the tenn
porary necessity Of such measures"
The time has come to impose what
ever taxes we are going to impose.
If we must inevitably come TO
sales tax, we might as we'll start this
year. OF course, it should only be
used to supplement heavily grad
uated income tax.
The third principle is that the
people who are best able to pay
should pay more heavily than the
lower-income groups. The best
method Of reaching this is by a
graduate net income tax. We have
always had that principle, and the
Treasury proposal extends It to an
amount which will seem very
burdenSome to many families. Under
the proposed Treasury rates, a family
with a gross income of about 81, TOO
will pay SITS in income taxes. or
about 6 per cent: family with a
gross income of $500 will pay $805,
or is per cent; a family with an
income of s11 900 will pay 81 ,435. or
more than % per cent; the bracket
above $4,000 will pay from AZ per
cent to 80 per cent. The tax is
graduated about as steeply as any
one could ask. The burden on the
wealthy and the middle income
groups is very heavy, but I don't see
how we can avoid it. and it may be
still heavier before the war is over.
On the other hand, while every
one agrees to the principle of a grad
uated tax, I believe every one also
agrees that the income remaining
to each man shall have some rela-
ton to what he had before. Differ
ences of income, differences in abil-
ity, in past thrift and in value to the
community. Unless we are going to
adopt communism and expect to
level all incomes, we cannot say that