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Show GRASSROOTS Let's Hope Economists Figured Income Accurately By Wright A. Patterson WHAT PERCENTAGE of each dollar we earn during the next fiscal year, beginning July 1, 1951, does the President ask congress to take away from us as federal taxes to pay for rearmament and the expenses of the government? That is an important question to each American. The President asks for a tax that will produce a total of $71 billion. That is the highest total amount the nation has ever been asked to pay, but the President estimates that the to'tal earnings of Americans for the next fiscal year will be not less than $240 billion, and of that amount we will pay out of each dollar we earn 25.9 cents. As a tax, that is mild compared with what we were charged in 1945, when the government took 52.42 out of each of our earned dollars, and at that we were a long, long way from paying pay-ing the war cost of that year, and added more than 70 billions to our national debt. Now the President is insisting that we pay the cost of rearmament rearm-ament as we go, and not increase in-crease the national indebtedness, indebted-ness, and he figures a tax of 25.9, or less than 30 cents out of each earned dollar will accomplish ac-complish that result. What the total may be depends entirely on the total of the national income, the earnings of Americans as individuals, corporations, stockholders stock-holders or bond holders, farmers. If the President is right in his estimate es-timate of a national income of $240 billion that 25.9 cents out of each dollar will produce the $71 billion he says must be raised. It all depends de-pends on what we, collectively, earn during the next fiscal year. The President presented to congress con-gress a statement of what percentage percent-age of each earned dollar had been paid to the government as taxes in other years: In 1939 we paid as taxes 12.8 cents out of each earned dollar; in 1945 it was 52.42; in 1948 it was 16; in 1949, 17.9; in 1950, 18 3-in 3-in 1951, 18.7. Except for the year 1949, the tax rate on each earned dollar has not fluctuated as radically as we have thought, but the number of dollars we have earned, the total of the national nation-al annual income has fluctuated fluc-tuated greatly if the President's Presi-dent's figures are correct, and his figure for the next fiscal year is estimated at the high point of $240 billion. Let us hope we make it, and if we do we can easily afford to pay the 25.9 out of each of those dollars, dol-lars, keep the nation out of the red, and still pay the rearmament rearm-ament bills. The President gave to congress some idea as to who would pay the additional taxes. He would collect 35 per cent of it from individuals that is, from workers, farmers,' professional people and merchants' twenty-seven per cent from corporations, cor-porations, 11 per cent from additional addition-al excise taxes, and four per cent from customs. He did not say, but he undoubtedly knows, that the 27 per cent collected from corporations, corpora-tions, will be paid by the customers. custom-ers. The corporations will add that 27 per cent to the price of their products, and the purchaser of their products will do the paying. The President also offered a chart showing for what he proposed to spend the $71,000,000,000 (tax dollars) he was demanding. Fifty eight cents of each dollar would go to rearmament; 17 cents to the normal expense of the government-10 government-10 cents to meet our international obligations; eight cents for interest inter-est on our national debt; seven cents to the veterans administration. It can all work out that way, provided congress passes the needed tax legislation and the President's advisers are suffi-dently suffi-dently good at their economics to not overestimate the national nation-al income for the year beginning begin-ning next July 1. If that esti-. esti-. mated national income is more dollars than we Americans receive, re-ceive, the President win not have as many dollars to spend as he wants. The . President has intimated that in addition to the $71 billion he wants for next year, he may ask congress for another $2,700,000 000 with which to balance the expend" tures for this year, so as not to debt. If those economists nave over-guessed the amount of our an nual earnings, we may have an other tax increase in 1952 The above -is the tax picture the President painted. |