WILLIAM JENNINGS BRYAN ON THE INCOME TAX [William Jennings Bryan, an American political leader, was born in Illinois in 1860. He received a collegiate education in his native state and studied law, which he practiced for some years in Illinois, and then settled in Nebraska. He was successful in building up a practice, and equally successful in acquiring an influence in political affairs. He was elected to Congress as an advocate of bimetalism for two terms, but the crisis in the Democratic party, precipitated by its internal dissensions over the financial question, prevented his rise to a position of leadership until 1896. In that year the Democratic National Convention placed him in nomination for the presidency. was defeated, notwithstanding the fact that he had the nomination of the People's Party, supposed to be powerful in some of the Western states. Four years later he was again defeated for the presidency as the Democratic and Populist candidate. The following speech was made in the House of Representatives in 1894, and was considered an eloquent presentation of the arguments in favor of an income tax.] MR. He R. CHAIRMAN: If this were a mere contest in oratory, no one would be presumptuous enough to dispute the prize with the distinguished gentleman from New York [Mr. Cockran]; but clad in the armor of a righteous cause, I dare oppose myself to the shafts of his genius, believing that "pebbles of truth" will be more effective than the "javelin of error," even when hurled by the giant of the Philistines. [Applause.] What is this bill which has brought forth the vehement attack to which we have just listened? It is a bill reported by the Committee on Ways and Means, as the complement of the tariff bill. It, together with the tariff measure already considered, provides the necessary revenue for the support of the government. The point of attack is the income tax, individual and corporation (which is expected to raise about $30,000, ooo), and to that I will devote the few minutes which are allowed for closing the debate. The gentleman from New York insists that sufficient revenue will be raised from the tariff schedules, together with the present internal revenue taxes, and that it is therefore unnecessary to seek new objects for taxation. In this opinion he is not supported by the other members of the committee, and we have been constrained to follow our own judgment rather than his. The internal revenue bill which is now pending as an amendment to the tariff bill imposes a tax of 2 per cent. upon the net incomes of corporations, and in the case of corporations no exemption is allowed. I need not give all the reasons which led the committee to recommend this tax, but will suggest two of the most important. The stockholder in a corporation limits his liability. When the statute creating the corporation is fully complied with, the individual stockholder is secure, except to the extent fixed by the statute, whereas the entire property of the individual is ordinarily liable for his debts. Another reason is that corporations enjoy certain privileges and franchises. Some are given the right of eminent domain, while others, such as street-car companies, are given the right to use the streets of the city-a franchise which increases in value with each passing year. Corporations occupy the time and attention of our federal courts and enjoy the protection of the Federal government, and as they do not ordinarily pay taxes, the committee felt justified in proposing a light tax upon them. Some gentlemen have accused the committee of showing hostility to corporations. But, Mr. Chairman, we are not hostile to corporations; we simply believe that these creatures of the law, these fictitious persons, have no higher or dearer rights than the persons of flesh and blood whom God created and placed upon His footstool. [Applause.] The bill also imposes a tax of 2 per cent. upon individual incomes in excess of $4,000. We have proposed the maximum of exemption and the minimum of rate. The principle is not new in this country. For nearly ten years, during and after the war, an income tax was levied, varying from 21⁄2 to 10 per cent., while the exemption ranged from $600 to $2,000. In England the rate for 1892 was a little more than 2 per cent., the amount exempt $750, with an additional deduction of $600 on incomes of less than $2,000. The tax has been in force there in various forms for more than fifty years. In Prussia the income tax has been in operation for about twenty years; incomes under 900 marks are exempt, and the tax ranges from less than 1 per cent. to about 4 per cent., according to the size of the income. Austria has tried the income tax for thirty years, the exemption being about $113, and the rate ranging from 8 per cent. up to 20 per cent. A large sum is collected from an income tax in Italy; only incomes under $77.20 are exempt, and the rate runs up as high as 13 per cent. on some incomes. In the Netherlands the income tax has been in operation since 1823. At present, incomes under $260 are exempt, and the rate ranges from 2 per cent. to 3 I-5 per cent., the latter rate being paid upon incomes in excess of $3,280. In Zurich, Switzerland, the income tax has been in operation for more than half a century. Incomes under $100 are exempt, and the rate ranges from about I per cent. to almost 8 per cent., according to the size of the income. It will thus be seen that the income tax is no new device, and it will also be noticed that the committee has proposed a tax lighter in rate and more liberal in exemption than that imposed in any of the countries named. If I were consulting my own preference I would rather have a graduated tax, and I believe that such a tax could be defended not only upon principle, but upon grounds of public policy as well; but I gladly accept this bill as offering a more equitable plan for making up the deficit in our revenues than any other which has been proposed. The details of the bill will be discussed to-morrow under the fiveminute rule, and any necessary changes can be made. The committee presents the bill after careful consideration, but will cheerfully accept any changes which the wisdom of the House may suggest. The bill not only exempts from taxation, but from annoyance as well, every person whose income is below $3,500. This is an impor |