The Daily Record

Two Destructive Taxes

The Freeman magazine recently printed an important editorial in which it pointed to the need for a sweeping revision of our system of taxation. It dealt particularly with the inequities which are involved in the capital gains tax and in the double taxation of stock dividends. It is highly significant that neither Britain nor Canada has either of these grossly unjust taxes.

The worst phase of such taxes is not the injustice perpetrated on the individuals concerned. It lies in their depressing effect on the economy as a whole, which is of direct concern to us all, and in the fact that they are a force in favor of ultimate socialism. To quote The Freeman, "Nationalization is not the only means by which our economy could be shifted from an individualist to a collective basis. The power to tax, as has been said, is the power to destroy. It is in this field of taxation that the deepest leveling inroads have been made against the right of private property, of superior reward for superior effort and achievement, against that principle that what a man honestly earns should be his own."

"It is time for a change along lines compatible with the maintenance of a free economy based on private incentive, private risk, private enterprise."

As a purely practical matter, it is of the highest importance that individuals and enterprise be encouraged to spend and expand and progress at times such as the present, when business activity is leveling off. Elimination of the capital gains tax and double taxation of dividends would be a powerful shot in the arm to the whole economy.