A TAX PROGRAM FOR A SOLVENT AMERICA, >

by Roswell Magill '16, ChairmanCommittee on Postwar Tax Policy. RonaldPress Co. 1945. P. 278. $3.00.

The tax program which is recommended by this Committee is based on a belief in the system of free private enterprise, a. high volume of production and employment, and a tax system which will recognize the motives and incentives necessary to attain those ends. Emphasis throughout is upon the fiscal purposes of taxes rather than, as in many recent studies upon "social" or non-fiscal objectives. The orthodox policy of an annually balanced budget is constantly stressed while little sympathy is shown for "deficit spending." Taxes which produce stable revenues are preferred. This points to the desirability of diversified revenues and an income tax levied on a broad base and at substantial initial rates. Strict economy is recommended in expenditures and systematic retirement of the debt, while spending for the purpose of maintaining national income is frowned upon. These are regarded as prerequisites to a "solvent America," or perhaps more strictly a solvent federal fiscal policy.

One o£ the most interesting chapters deals with "venture capital," showing that small as well as large investors have been important as a source of risk capital and the basis o£ private enterprise; therefore tax relief must not be confined to corporations, as some plans propose. The recommendations for personal income taxes are much the same as in other reports, while excise taxes and even the possibility of a sales tax are accepted as inevitable unless expenditures are kept below the level which now appears feasible.

This report is an effective presentation of the orthodox view which rejects recent proposals for spending our way to "full employment" and emphasizes in taxes the traditional virtues of bringing in stable revenues, annua] budget balancing, and a preference for taxes which are most likely to stimulate production and the growth of free, private enterprise.