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Show Magill Urges Income Tax Cuts, New Revenues to Spur Growth The tax system must be simplified simpli-fied and broadened, with much lower income tax rates and larger exemptions, if our economy is to get the funds it needs for healthy growth, former Under-Secretary of the Treasury Roswell Magill writes in the January Reader's Digest. "Our principal competitors in the world market, notably West Germany and the Soviet Union have long preceded us in utilizing utiliz-ing the far more successful sales and excise taxes," says Mr. Magill, Ma-gill, who is now Chairman of the Tax Foundation. "It is perhaps per-haps significant that in Soviet Russia 30 per cent of the gross national product goes into capital investment; in West Germany it is 23 per cent; in the United States 15 per cent. We stand unhappily un-happily unique in our dependence depend-ence on an income tax which offers no incentive to work and produce and which absorbs earnings earn-ings that should be invested in new plants and equipment." The federal income tax produced pro-duced 62 billion dollars in 1960 as opposed to 36 billion in 1951 he notes, but still more money is needed. Some have argued that it can be raised and rates actually actu-ally lowered if so-called "loopholes" "loop-holes" are plugged. Magill denies this. If all exemptions and deductions deduc-tions were wiped out the extra exemption granted to the blind interest on home mortgages, deductions de-ductions for hurricane destruction, destruc-tion, for three examples the tax would lose much of the quality qual-ity of fairness that caused its adoption. And it is only this quality of fairness which has induced in-duced taxpayers to tolerate it, despite its high rates, he writes. Instead, he concludes, "we need to add a productive, simpler form of tax to our federal fiscal 3. IS 6X13.1 " The article is titled "Plugging the Loopholes Is Not the Answer." |