quired to make a return under oath of the amount of such property in their possession.[1] Yet a petition recently presented to the Legislature of the State by representative members of boards of trade and chambers of commerce recites that the law in question "is ineffective and therefore ridiculous, as is proved by the fact that although the market value of shares of foreign corporations held by citizens of Boston alone is believed to be over $600,000,000, the amount taxed by the assessors of Boston was then only estimated at $45,000,000; and nearly all of this that is known is taxed to the unfortunate people whose estates are in trust,"[2]
In the United States the income tax, as enacted in 1803, exempted $600 annual income for each person, together with whatever was paid annually for rent and repairs of residence. Five per cent per annum was then levied on all incomes above $600 and not in excess of $5,000; seven per cent on all incomes in excess of $10,000. In the income tax of the United States as it existed at one period there was, therefore, recognized the principle not only of exempting incomes below a certain amount from all taxation, which amount, in order to keep up the appearances of equity, was allowed to be equally deducted from all larger incomes; and in addition a further feature, not generally recognized in other existing systems of income taxations, of "graduating" the assessment by increasing the rate or the percentage on the larger incomes; a system most exceptional and peculiar, but which on first presentation seemed to find favor as an ingenious and equitable method of equalizing the burdens of the State between the rich and the poor.
- ↑ The tax laws of New Hampshire and Vermont are drafted especially with a view to compelling the disclosure of income.
- ↑ If any one thinks that this extraordinary tax experience is limited to one section of the country, he would do well to acquaint himself with the recent results of the State of Ohio in attempting to tax money on deposit. Ohio has even a more efficient and minute scheme of taxing all classes of property than Massachusetts. Not only is every citizen bound under oath to make a complete return of his property, but the law, in addition, empowers each county in the State to contract with certain so-called "tax inquisitors" for the payment of twenty per cent of all taxes collected through their agency on previously assessed property. How successful this scheme has been in collecting taxes on money on deposit is shown by the fact, revealed in a recent report of the State Board of Tax Commissioners, that while the amount of money on deposit in the State, national, and private banks of Ohio in 1892, and subject to State taxation, was at least $190,000,000, the amount actually returned for taxation in the whole State during that same year was but a little over $32,000,000. There is a remark that has almost assumed the character of a proverb, that a text suitable to and illustrative of every situation may be found in the Bible. The text that is most applicable, and which ought to be full of instruction to every congressional advocate of the enactment of an income tax by the Federal Government in time of peace, will be found in the sixth chapter of the First Epistle of Paul to the Corinthians, where the apostle, as if he had the existing situation in view, remarks, "All things are lawful unto me, but all things are not expedient."
