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Show How Transactions Tax Lifts Hawaii Free of Big Debt Washington, D. C Congressman Congress-man Martin Smith (Dem., Wpsh.) was calling the attention of supporters sup-porters of HR 4199 this week to a remarkable article on the Hawaiian Ha-waiian transactions tax, now ' in effect in that territory. 'Written by M. W Jorz, it was published 'in the Los Angeles Illustrated Il-lustrated Daily News, December ' Si, 1937. Mr. Jorz, who is the fin ancial editor of that paper and an expert on taxation, declared: "The United States could wipe out its national debt and be money mon-ey ahead within five years if the Federal Government would adopt the Hawaiian taxation system. The islands have solved their tax problem by institution of a gross-income tax. "Not only has it saved the Territory Ter-ritory from bankruptcy but it has simplified the revenue collection to such an extent that the most ignorant ig-norant oriental peddler in the street knows how the make out ins tax return The Gross-income Gross-income tax went into effect July 1, 1935, with a levy of 1 percent on all incomes except salaries and wages. The Territorial government was $1,259,000 in debt, had slashed the pay of all teachers and Territorial Terri-torial employees 10 percent, and seemed hopelessly mired. It was estimated that the gross income tax would raise $5,108,000 in the first year of the new tax. No one beCieved it possible. At the end of the first year Territory coffers liad taken in $6,116,000. "The gross income tax is twelve times as effective as taxes collected collect-ed once a year. Hawaii gets its revenue every month, and the money is turned over 12 times a year; with only a tiny levy you can get revenue figures that read like a lesson in astronomy ; they have made their rate 1V4 percent now and have nothing whatever to worry about. The loophole lo-ophole is gone forever, and nobody no-body seems to carei If you would put a 1-percent gross income in-come tax in the United States, you could forget all about those thirty-seven billions in debt and have money to spare within five years easily; kick out sales taxes and take 1 percent on gross ' Incomes and you would have three times as much cash." |