Show E ELMO SCOTT WATSON kt WONT be long now until uncle sam will be saying to his children and approximately to and 0 half million individuals and nearly three quarters of a mahlon groups of uala will be digging down in pockets and handing over a certain part of their alss to their uncle xv ho Is in need of this money to aid ing a nation of more than and a continuance of their life liberty and pursuit of happiness all of which Is by way at saying that the filing of income tax returns by corporations and bals and the payment of the first in of the 1928 income tax Is due on march 15 just what that means was indicated by n newspaper editorial writer who observed recently that many persons are bared not so much over pay ment of their income tuxes as over the complicated task of making them out the roan who finds after an all session his income tax blank that he owes the government only twenty nine cents his to go through alie same complicated processes as the man who la entirely out of the enclosed please fand stamps class in addition to the general govern at the united states many in states ampo an income tax municipalities have not become ad dietel dieted to the practice but if they should the average man who has to sit up late to clear op the difficulties involved in checking up his milk bill might as well prepare to ask for a weeks vacation in which to pursue the delushe and many times be clouded issues which the ordinary lax blank presents income taxes in the united states are a twentieth century product springing out of the stress of war time conditions aliey have nourished to euca an extent eliat an occasional bumper crop prompts the government to band back the surplus the states have not yet complained of overflow ing treasuries at this time millions of amateur accountants each armed with an adequate supply of kad pen calsa ream or two of note paper text books on mathematics government clr and hope that springs eternal are squaring away for the annual erent american task of filling out my encomb tax blanks it was just 20 years ago that uncle sam decided to impose an income tax upon his children for it waa on july 12 1009 that the sixty first congress proposed to the legislatures of the various states the following amend ment to atie constitution the con gress shall have power to hy and col elect lect taxes on incomes froio whatever sources derived without apportion ment amons the several states and without regard to any census or enu this was accepted by all of the except con florida pennsylvania rhode island rtuh and virginia it ans declared to have been ratified as article XVI or the sixteenth amendment to the constitution and a law in a proclamation of philander 0 knox secretary of state in president cabinet on february 25 1913 last year uncle sam collected a total of in income tax tills represented a total of returns of which were in and partnership and were corporation of the total tax waa paid in by the in and partners and by corporations to realize what vast sums americans have paid out of their pockets into uncle sams pockets all you need to do Is take a look at the table of income tax collection during the last ten years 1018 1919 1920 1921 1922 1923 1924 1925 1920 1927 america Is universally looked upon as the richest nation on earth and an interesting commentary on bow the wealth of the individual american in ceased re ased especially during the war Is shown in lie income tax returns dur ing the same period given in the table aboe in 1913 a total of returns were filed in 1914 there were in 1915 there were und in 1910 then ame the sudden wave of prosperity during the war and in 1917 the number of returns jumped to from then on there was a steady increase in the number of individuals who filed irksome tax returns in 1918 there were 4 1919 saw filing returns and in 1920 the number reached alie peak with alien a revision of the income tax law caused the num her to drop to 0 it rose to in 1022 and then jumped to in 1923 in 1024 a total of persons filed income tax re turns in 1925 there was again a sharp drop in the number of income tax returns to rl oa february 20 1920 president signed the revenue act of 1920 a new law for the year 1925 and thereafter which fixed the normal tax rate fur individuals at 1 3 and 5 per cent for net incomes from up to it also decreased the surtax rates and increased the personal exemption of a single person to 1500 and of a married person or head of a family to awo it also raised to the amount of income which may be considered as earned and taxed at lower rates the first five thousand dollars of net income in all cases Is deemed to be earned some interesting fabb on the income tax situation especially in regard to the increase lp amount of duel tax being paid into ancle sams pocket despite rate cuts wire contained in a recent press dispatch from washing ton which roads as fellows washington joseph 8 mccoy KOV eminent actuary ba mad an abaly ls of income tax ot the united states for four years and points out doroe remarkable facia for SO years congress ha depended on mr mccoy to furnish the ways find means and th finance committees information on which to frame tariff and tax measures ills opinion Is considered the last word on federal taxes mr compares th calendar fear of 1321 with that of 1927 the total taxable net for 1921 was returned by individuals while for 1927 it wan 18 returned by only individuals bald mr mccoy that Is practically the aaroe net income as was returned in 1927 from 60 per cent as many individuals as returned similar in comein 1921 the net income returned by those with incomes in excess of however increased from in 1921 to in 1927 the net income alone did not increase but the total net tax returned increased for 1921 to for commenting on the showing made mr mccoy bald the strange almost unbelievable fact Is revealed by thesal statistics that in spite of the deduc alon of the tax rates by fully 10 per cent out of the total number of returns aggregating 7 tor 1921 individuals in 1927 returned net taxes of in excess of that returned tor 1921 the average tax returned for 1321 was and tor 1927 an increase of average tax of per cent and of gross tax of per cent as compared with a re in the number returning taxable net income of per cent and a reduction in the average tax rate of about 10 per cent the reason for athla anomaly Is clear i ly the enormous increase in the number and income of the larger together with the elimination of so many of th smaller taxpayers taxi ayers mr mccoy asserted that the callec alons show that secretary mellon was right when ha told congress that a re within reason in income tax rates results in a greater tax yield another thing shown mr mccoy gild Is the displacement of individual 1 v ct rate business the 1927 prelim inary returns show that the bruni iruni individual business was 13 23 coil while the total gross income returned by corporations was th total net income returned by taxable individuals for 1927 was ai compared with tsi SOS taxable net income returned by corporations the entire income returned by in from wages and salaries wa 0 kcf osa as com with only as the returns tor individual business this would seem to indicate that immense sums must be paid to taxpayers as wage and salaries by corporations the marked effect of the new tax laws upon the wage earner Is re flecty in the returns of incomes from wages and eal arles for 1921 as compared with similar returns for in eplite of the great increase in incomes and in creased prosperity these returns for 1921 totaled over 3 more than did similar returns for 1927 this Is account ed for by the personal exemption in crease of CO per cent for single person and of 10 per cent for married persons and heads of families which reduced the number ol 01 returns oer i bals from 1921 to WT mr mccoy based his study on the preliminary statistics of income for the calendar year 1927 the total number of individuals mak ins returns for 1921 was while for 1927 only made re turns a reduction of over 13 per ceat he pointed out this was caused by the increased personal exemptions p 0 elded by the revenue act of 1926 the number returning net income la excess of however Is another story tor there were of such returns as comp comard rd with for an increase 1 over 31 per cent the number returning net incomes ol 01 over tor 19 wa CM and fot 1927 11 OCT an increate of nearly 95 pei cent the number returning incomes in excess of 1000 for 1921 was 71 and tor 1327 an increase of almost 83 pw cent |