Show 0 4 0 01 0 r r washington in the last few weeks in washington we have heard beard little about alatini all talk any governmental about taxes affairs except taxes everyone charged with responsibility for or maintenance of the supply of cash to carry on the era of 0 spending Is talking about taxes it Is to la truth the predominant subject overshadowing even the lobby investigation ti headed by senator black alabama democrat with that committees mit tees record of obtaining private telegrams by subterfuge it really Is not startling that everyone should be talking about taxes because however you ex examine amille the question of government at this time your analysis must inevitably lead back to the question of tile the source of funds and how bow could it be otherwise we have a national debt larger than it has ever ener been before and still going higher we have seven or nine or eleven million people unemployed depending on the source of your information on this point and we are confronted with declarations from president roosevelt and his advisers that more must be spent it seems perfectly obvious therefore that saner minds should be examining the whole economic structure of the nation to determine from whence the money Is to come congress Is in the midst of 0 working out a new tax tas bill the house of representatives where revenue legislation must originate according to the constitution which Is still operative la Is up to its neck with the tax problem it Is trying to work out a tax bill that will carry out the white house orders to take more money from corporations by levies on surpluses along with some minor schemes of taxation designed to increase the total somewhat during the time the house ways and means committee was trying to formulate a tax program on the basis of the presidents tax message there was a perfect deluge of tax discussion hereabouts I 1 think it may be said in this connection also that the house ways and means committee attee did a rather ridiculous thing as a preliminary to presentation of a tax bill to tile the house honse it actually began hearings on tax tas legislation without a tax bill in legislative language having been drafted As far as I 1 can learn it was the first time that witnesses were called in and asked to testify as to the efficacy elli cacy of proposed tax legislation when there was actually not language in legislative form about which those witnesses could testify either for or against all the committee had before it was a so called committee report a statement of its views as to what ought to tie be done and it was almost pitiful to witness individuals who are expert on taxation attempting to catch on to some willo will o th eul and say that it was sound or unsound yet that was what chairman doughton democrat north carolina and his bis committee asked the them in to do perhaps I 1 ought to explain for the benefit of those not acquainted with tax legislation that there Is nothing so important in a tax bill as the exact language 0 0 one benefit has accrued from this situation however and I 1 hope as I 1 believe everyone wheelers else desiring good suggestion government a and n d t proper laws hopes that it will result in a tax bill generally more acceptable than has been proposed thus far the alie maelstrom of discussion that has arisen from the house ways and means committee hearings has made a good many people tax conscious being tax conscious at this time a good many men capable of thinking st straight raight have begun to offer suggestions I 1 have been receiving some of oc them myself and one that has come to me has impressed me so much that I 1 am going to use the substance of it in this column it comes to me from mr harry A wheeler widely known business executive and banker of chicago mr wheeler has been recognized for a quarter of a century as a man who Is given to lo looking oling rather far into the future and for his ability to analyze problems circumstances and conditions on a long term basis rather than ou on urgency of current requirements quire ments since the consideration of tile the corporate surplus tax act began mr wheeler wrote me 1 I have watched the proceedings closely for some alternative proposal that would produce a substantial tas revenue arid and yet tend to strengthen the program of the administration to assure continuing business recovery cov ry create definite added employment in industries still down find and lower production costs and prices to the ultimate co sumer no ona one denies that increased federal rc revenue denue by taxation Is imperative but it may be open to argument whether this can best he produced phoil need by the direct route of tax levies to cover full requirement or by beginning with a plan that will produce a large proportion of the requirements and permit the use of 0 the remainder to accomplish the results first above stated the proposal Is very simple quite capable of being written into legislative provisions it would carry a clear guarantee of useful results and reach the final full requirements quire ments of the government by progressively increasing taxable profits 1 I propose that whatever per rent cent of undistributed profits may be determined ter mined upon as the tax base permission shall be given for a drawback or retention of say 20 25 or 33 per cent on condition that this amount shall be used tor for capital expenditure pend iture to improve and cli cheapen eapen production and distribution facilities aties q the drawback draw back may be by repayment to the taxpayer upon voucher evidence that the amount has been actually expended or by credit upon the second years tax levy corporations will not fall to use this remainder and perhaps evenn even add to it out of their available corporate resources 0 4 0 permanent goods industries will at once be stimulated by the knowl edge t that h a t pur stimulate c chases it a s e s will ivill be industries made to an aggregate of the drawback and stimulation of em employment p loy must result in most needed quarters the universality of this improvement pro in production and distribution trib ution facilities will create the competitive conditions that will nill compel savings to be passed on to consumers but if 1 any corporation tries to hold the added profits they will be taxed away in the following years living standards may be raised by making more commodities come within the range of prices the public will pay forced distribution in dividends to escape corporate high brackets will find a large part being paid to stockholders taxed in very 1 low brackets and the result aver over AN a 11 ll ib not 1311 unlikely likely to prove disappointing increased tax rates on income or earnings leads to the struggle to avoid payment by every device that can be developed it may be that this plan of drawback draw back would distinctly modify this tendency it is the first time that I 1 have heard beard from any source the suggestion that the tax law should be made an instrument to encourage business recovery and promote employment all of the objections heretofore have been directed at the character of the proposal and have not included constructive thoughts which could be used as a new base mr wheelers plan may not be complete it may not represent an answer to the tax needs in their entirety but it must be said in its favor that it suggests an approach to the necessary answer and embodies therein a plan of action which will not kill the goose that lays the golden egg in other words it hasteen has been proved too many times to require discussion that higher tax rates reduce the incentive and the chief opposition to the administration proposal is just that it takes away the incentive of the corporations po rations lons to make more money which would be available for taxation alon the wheeler proposal therefore offers an ancen incentive tire to corporations to proceed wl with th plans of expanding pall ding their operation and thereby increase ill the number of workers on their payrolls I 1 repeat that I 1 do not h know now whether the wheeler program Is the complete answer but nearing the fact that n tax limit man of ct ills his status in the count rys business life is giving consideration to tile the tax problem on a basis leads certainly to two conclusions these conclusions are first that the country is nearing the limits of what ml might bt be called reasonable taxation and second that a very great majority of our people believe some consideration should be given to the need tor for an end t to government spending it if taxation has reached tile the point where an over expanded cd federal government requires so much money that it must anke away the backlogs the reserves of business then it Is quite apparent that a shrinkage in tills this structure called government must begin if it does not one ona could reasonably say that government credit is bendan endangered alered or will be if the spending continues much longer longer wo we have been using up tip our resources actually in billions for the construction of many different types of things from which no earnings accrue then to in addition I 1 think no one can deny dedy but that there has been widespread waste of these funds 0 western newspaper union |