Page:Popular Science Monthly Volume 53.djvu/392

376 The present is therefore an advantageous opportunity for asking whether any income tax which discriminates in any degree is likely, as is often claimed, to constitute the one perfect form of taxation of the future. And at the outset attention is asked to the following considerations, to which popular attention is not always intelligently given:

A Federal income-tax system necessarily involves multiple taxation on one and the same income, person, and property. For example, in the United States a citizen of any one State would be liable, in the first instance, to the Federal tax on his income; second, to a State tax on the same income; third, to a tax on the property or business producing the income, in virtue of its location and consequent territorial jurisdiction of the State. In some States—Massachusetts, for example—the State, in virtue of its jurisdiction, over a person, taxes him also for property beyond its territorial jurisdiction and subject to taxation in the State where it is an actuality. Doubtless such duplications in a greater or less degree will be inevitable in the case of all Federal taxation. But where there are so many sources available to the national Government for obtaining revenue, it would seem to be impolitic for it to encroach on those methods which are particularly applicable to the States—as income taxes, taxes on legacies and successions, which are governed and protected by State laws, and franchises, which are almost exclusively granted by the States and rarely by the Federal Government. Certainly there would seem to be no warrant in either justice or expediency in unnecessarily favoring such a system of multiple taxation; thereby increasing the real or fancied grievances of the people in respect to all taxation, and creating, by reason of a sense of injustice, additional temptations on the part of the taxpayer to fraud and evasion.

Again, all modern systems of income taxation have recognized the principle of discriminating in favor of persons in receipt of comparatively small incomes, and have provided as a fundamental feature of their policy, that all incomes below a certain rate should be exempted from assessment. Such exemptions, except in the ease of the United States, have always and until within a recent period been of a comparatively small amount. In Great Britain it is £160 ($800) per annum. No difference is made in England in levying the income tax, though often proposed and advocated, on account of the source whence the income is derived. Whether the income is earned by the exertions of its possessor, or arises from property, so that the recipient is sure of it without the slightest exertion at all on his part, the same proportion has always been deducted from it. In the administration of its income-tax system England has