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Show Emphasis of Taxation Laid Rather on Expenditures Than on Incomes. By OTTO H. KAHN, in "Our Economic and Other Problems." ml m The social and moral argument for an unsparing war profits tax are to my mind cvinswerable. To permit per-mit individuals and corporations to nrich themselves out of the dreadful calamity of war is repugnnnt to one's sense of right and justice and gravely detrimental detrimen-tal to the war morale of the people. . . . The objection to a very heavy excess profits tax in peace time rests not so much on equitable grounds as on the ground that on the one hand it does not and eannot accomplish the social purpose aimed at, and on uie otuei u&nli it tends to hurt trade, discourage enterprise and burden the public. Our excess profits tax certainly has not stopped, hut rather 'has intensified what is commonly termed "profiteering." For a country as immensely rich and intrinsically as little burdened, relatively, as ours, it is really not a problem of great difficulty to raise by taxation the sum which the needs of the occasion require. A small committee of well-informed men of different callings, approaching their task free from political, social and sectional bias . -. . might recommend a radical revision of income taxation on the theory that the emphasis of taxation be laid rather on expenditures than on incomes and that a sharply marked "distinction be made between such portion of a person's income as is used constructively in savings, investments or enterprise, and such portion as is spent on his scale of living. Much can be said for such a tax from both the economic and moral points of view. Among other desirable effects, it would reach those who, by holding tax-exempt securities, now escape the burden of income taxation taxa-tion ... ti . , . ; The committee might also, I should think, reach the conclusion, quite irrespective of the theory suggested in the foregoing paragraphs, to recommend the imposition of a small percentage tax, say 1 per cent, on all sales of commodities and products and presumably of real estate. Such a measure would be productive of an immense amount of revenue and would not be harmful to anyone. |