Evening star., 1943-12-09
0'Mahoney Presents
Incentive Tax Views
On Star Radio Forum

Profits made after the war in new
independent enterprise should be
less heavily taxed than other profits
Senator OMahoney, Democrat, of
wyoming said last night in explain
ing incentive taxation" on the
National Radio Forum. I'm other
words" the Senator said, Il believe
that we should reward the men who
by their ingenuity and their money
create new jobs"
The Senator discussed incentive
taxation over the Blue Network from
Station WMAL in the weekly forum
feature arranged by The Star. He
brought C. w. Hazelett, author of
Dynamic Capitalism" from New
York to answer questions on incen-
tive taxation before the microphone
Both were introduced by Edward
Boykin, who conducts the forum.
In the ensuing discussion, the SEN
ator and the author explained the
principle of taxation they were ad-
vocating thus;
1T has been my experience" SEN
ator OMahoney said. that many
owners of capital decline to invest
because, they say, under the present
system they take all the risk while
the Government takes most of the
profit. Therefore, they tend to hold
on to their money until they see a
sure thing Thus the willingness
to take a risk in new enterprise is
reduced and we become dependent
on the Government or on monopoly
for the investment which provides
jobs. How would incentive taxation
promote Investments"
Would Put Money to Work.
Mr.. Hazelett's answer was, BY
making 1t more profitable to invest
than not to invest. We would re-
uuire every corporation and busi-
ness to use its money to employ men,
to convert it's plant. expand its pro-
duction, improve its facilities and
working conditions, do research or
to promptly pay its profits out in
dividends, or temporarily lend its
to lower its tax rate. 1t would be
more expensive not to use money
than to use it. Thus we would put
money to work to keep our labor
force on the job and to re-employ
our heroes as fast as they are de-
modified"
Senator O'Mahonev asked if in
centive taxation applied to indivi-
duals as well as corporations.
Definitely answered Mr.. Haze
lett. IF have money and l do not
Use it to buy something, some one
is out of a job and is without money
to buy from another. Then the lat
ter is out of job and so on. In
centive taxation requires me, you
and every one else who might con-
troll any substantial amount of
money either TO spend it promptly,
thus creating markets for business,
or to invest it directly or through
the savings banks OF insurance COM
panies. in creating new business,
new enterprise, new development,
new Jobs. In this manner the money
promptly and continuously flown
back to both big and little business,
to provide them with capital, to
convert and expand their plants"
Higher Taxes Advocated.
Irrespective of incentive taxation.
Senator OMahoney said, higher
taxes should be enacted Immediately
to increase the revenue of the Gov
ernment.
Il shall not take the time to dis
cuSs the ways and means of in
creasing Government revenue" he
said. L shall only say that a COM
pila ton published in the New York
Times last Sunday Of the earnings
of 287 industrial manufacturing
companies shows that in spite of
heavier taxes and higher costs of
labor and materials the profits of
these companies were II per cent
1943 than for the same period of
1912. They had a combined net in
come of 1868 100000 in the 1943
period against 1868 100000 in the
1912 period. These were profits that
we're made out of the Governments
borrowings against the. future. 1t
certainly requires no argument to
prove that unless We make some
effort to pay the Government bor-
roWings back out of present earn
ings. the task for the future will be
difficult, indeed"