HIGH TAXATION

Evening Post, Volume CVII, Issue 140, 14 June 1924, Page 13

HIGH TAXATION

DO THE PUBLIC BENEFIT?

The Welfare League writes:—

" The average Socialist politician is strong for the policy of taxing wealth. He would crowd on to the rich all the burdens of taxation possible—land tax, income tax, sur-tax, and super-tax, and, finally, capital levy. All are considered desirable as means of exploiting the wealthy. This craze for high taxation, and even higher, is due to some degree of illusion as to what the wealth of the rich consists of, how it is placed. The picture is drawn of a fat man'living in luxurious idleness, and whose general hoggishness in consumption leaves other people in want. This is held up as the type of the wealthy. It is a gross caricature and deception, save as applied in decadent individuals who do not actually count amongst the wealthy and successful as a class. The wealthy of importance are those whose riches are in mines, shipping, farming, foundries, motors, manufacturers, general transport, and exchange undertakings. To take the wealth of those by high taxation may not touch the individual personally, but very seriously affects the iudustry or business to the detriment of the public. " Over and over it has been explained that even in the instances where the high lates are actually effective and the taxes are paid, the public gets from the rich man less than it would gain if it allowed him to keep it and use it in industry. The chief difficulty in all this discussion and in the broad discussion of wealth distribution, is in getting a general understanding of the community values of private wealth. These taxes, heavy as they are, seldom cut enough to compel any personal economies by the taxpayer. They do not affect his living expenditure, but merely reduce the amount ho would otherwise . invest in the expansion of industry. " Henry Ford has a very clear grasp of this. Mr. Ford says: ' That it would make little difference to him, so far as personal comfort or expenditure are concerned, whether the taxes took 1 per cent, or 99 per cent, of his profits. If he had 1 per cent, left, it would still supply all he would care to spend on himself, and whatever he has left above his living expenses he always has expended, and expects always to expend, upon industrial developments. Whatever is taken from him to be expended by public officials means just so much of a curtailment of his enterprises.' " The increases in numbers of workmen employed by Mr. Ford from, say, 1000 men to 100,000 men or more, has meant nothing to him in the sense of personal gain; no part of the additional earnings have been devoted to him; they have all been used to provide the equipment required for the employment of more wage-earners and pay more wages. All the gains of the larger businesses have been used for the development of the industry and to produce an increasing output of cheap cars, wanted by the millions. "It would be as well if the people in general could understand that the cutting in on capital by high taxation is against their interests, whether they are commercial men. housekeepers, or labourers. It should' be recognised that earnings devoted to industry are as truly given to a public purpose as thouo-h :t were owned by the State; indeed, the private industry serves greater public Leeds by being in general more productive than the political and officiallyoverweighted State enterprises. Those who seek the social welfare then should strive for the protection of capital and not its destruction.

The more wealth the politicians get control of the greater the waste and the greater the demand for still more taxation With the increase of loan burdens and btate trading in Australia the I axes have gone up rather than down, and this because capital is diverted Horn proper channels of production to serve political ends, where there ,ire endless leakages, which leave both the btate and tho individual but the poorer Ihe more capital is left free for productive^ purposes, and the less it is levied on by taxation, the greater will be the total wealth produced from which all citizens must more or less benefit "In our opinion hign taxation on productive wealth is an evil that society should endeavour to escape from; it injures all, and by no means least the mass of wage-earners who live by our industries." J