Detroit evening times. (Detroit, Mich) 1921-1958, 1943-11-26


The administrations case for increasing
the individual income tax by 6l2 billions was
based almost entirely on the alleged need for
absorbing through taxation the so-caled excess
purchasing power of the people as means of
helping to combat the threat of imitation. The
treasury, however, in setting up its program,
completely ignored the fact such excess pur-
chasing power as may exist is not equally dis
tributed among all the people.
FURTHERMORE, it's sincerity in putting
J. forward the ant-infiation argument as a
justification for increased personal income
taxes became Immediately questionable when
it developed that its tax proposals were not
aimed at reaching this so-called excess pur-
chasing power in the hands Of those who are
known to enjoy the great bulk of it. Hence,
even if enacted, the treasury tax program
would make little if any, contribution to infla-
ton control.
q Corporation taxes-The bill makes no in
u crease in the rate of tax of normal corpo-
rate profits, which now stands at maximum
of 40 per cent, but does increase the excess
profits rate from 80 to 90 per cent, and makes
"a reduction in the invested capital credit in
the case of larger corporations. The impact
of the proposed 90 per cent excess profits rate
as applied to smaller corporations is cushioned
to some extent by increasing the specific
exemption under the excess profits tax from
So 900 to $4,000.
In our joint statement issued at the outset
Of the committees deliberations, we pointed
out that in view of the already high corporate
rates any drastic increase would threaten the
future sovency of business and impair it's
ability to provide peacetime jobs to returning
servicemen and unemployed war workers. The
retention OF the maximum rate of 40 per cent
on normal corporate income is in accord with
our previously announced position.
= Estate and gift taXes-No change is made
= in the rates or exemptions under the estate
and gift taxes. The estate tax now reaches a
maximum of II per cent, which is perhaps as
high as Congress can go without bordering on
actual confiscation of property through taxa
ton, which is policy that is totally foreign to
fundamental American principles, although it
has been embraced to a considerable extent by
the present administration. 1t must not be
forgotten that the states, too make use of this
form of taxation, and after all, they have sole
control, under the American form of govern
ment of the right of devolution of property at
death. ~-
ASIDE FROM OTHER SHORTCOMINGS
OF THE PRESENT TAX SYSTEM, THERE
HAS IN RECENT YEARS GROWN UP A
TENDENCY TO USE TAXES FOR OTHER
THAN REVENUE PURPOSES.
CNDT<h fhT<STNI
TON, THE TANNING POWER HAS BEEN
AVAILED OF FOR PUNITIVE PURPOSES,
FOR SOCIAL EXPERIMENTATION, AND
FOR EFFECTUATING OTHERWISE UN-
CONSTITUTIONAL FEDERAL CONTROLS
OVER THE PEOPLE.
This practice cannot be too severely con-
demned It is entirely contrary to the intent
and purpose of the Constitution in granting
Congress the power to levy taxes solely for the
raising of revenue for the support of govern
ment
w HEN the war ends, Congress will be
w faced with the problem of financing a
postwar budget which may exceed $40, 600, OOO,-
900 annually. 1t is essential to the maintenance
of sound fiscal policy, including national SOL
vency, that federal revenues and expenditures
be brought into balance as soon as possible
after peace comes.
THIS CAN ONLY BE DONE If THE Ma
TIONAL INCOME, Is MAINTAINED AT A
HIGH LEVEL.
The adoption of high tax policy will have
more, to do than anything cleo --'+1 --e >.
chat high level of national income is MAIN
tanned; since the responsibility will rest pri-
marily on private business enterprise for its
realization
GOVERNMENT SPENDING WILL NOT
DO THE JOB, But ON THE CONTRARY
WILL ONLY TAKE THE COUNTRY FUR
THEIR ALONG THE ROAD TO NATIONAL
BANKRUPTCY.
If sound healthy, and expanding national