The New York Times does not care for the new “income tax” passed by Congress to fund the war. The editor has two objections: first, it will produce an army of civil servants — and before the Civil Service Act, they were actually just political cronies of whoever was in power. Second, it collecting the tax will cost 3.5% of the taxes collected, which apparently is unacceptable — seems like pretty reasonable overhead to me.
The Tax Bill The Cost of Collecting the Taxes.
One of the worst provisions of the Tax bill recently passed by Congress is that under which an army of office-holders is to be appointed. Our country has heretofore been cursed with thousands of persons whose main business has been to seek place under the Government, hoping to obtain a livelihood thus, rather than by engaging in regular and legitimate occupations. Every change of Administration brings with it apprehension in the minds of those who have held positions under the former one, lest they shall be sacrificed to make room for others whose party services have rendered them worthy in the eyes of the incoming heads of departments. Thousands who, if appointments to and removals from office were made with regard only to qualification and disqualification, would engage in pursuits profitable to themselves and useful to the community, find office only to be removed therefrom at the expiration of four years. This evil, it appears, will be largely increased by the passage of the Tax bill, which requires a large additional force of Government officials to be appointed.
The injury inflicted on the country by withdrawing competent men from other occupations to fill these places, is not the only one. The people will be heavily taxed to support them, and to pay them for collecting the money due the Government. Projects, less expensive in the manner of collection proposed, were submitted, but Congress saw fit to adopt the more costly.
The Tax bill authorizes the appointment of the following officers, viz.: Collectors, Assessors, Deputy Collectors, Assistant Assessors, and Inspectors. A Collector and Assessor are to be appointed by the President over each Collection and Assessment District, the number of which districts is not to exceed the number of representatives in Congress, except in the case of one or two States. A collection or assessment district will therefore embrace about the same extent, and contain about the same number of inhabitants as a Congressional District. The number of representatives in the present Congress is 178, in which number is not included any representative from North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Louisiana, Texas or Arkansas.
Only the loyal States, in which the taxes can be collected, are included in the following estimate of expenses. Each Collector is to receive as compensation for his services and those of his deputies, a certain commission on the amount of money collected, the total of which is limited to $10,000 per annum for each Collector. This will give us, for the pay of Collectors and their deputies, $1,780,000. Each Assessor is to receive $3 per day when making preparations, issuing instructions, etc.; and $5 per day when engaged in the performance of the regular duties of his office. As the preliminary proceedings will occupy but little time, we make our estimate at 85 per day. The regular pay for each Assessor will, then, be $1,565 per annum, as there are 318 working days in each year. That of 178 Assessors, $278,570.
In addition to this stated salary of $5 per day, Assessors are to receive a commission of one dollar for each hundred names on the tax lists which they furnish to Collectors. Of course, we cannot exactly state the sum which this commission will amount to, but it will be safe to say that the number of taxable persons in the United States will exceed the number of voters, because almost every one is subject to taxation for greater or less amounts, females as well as males, minors possessing property, as well as those who have attained their majority. If we allow $25,000 as the number of taxable persons in each district, the commissions will amount to $44,500. Assistant Assessors are to receive a salary of [???] per day; their number is to be regulated by the Secretary of the Treasury. Suppose each Assessor to appoint five assistants, the expense for their salaries in each district will then amount to $4,695 per year, the total expense in this account, to $835,710. The Assistant Assessors receive the same commissions as Assessors. According to our estimate, made above, the total of these commissions — assuming five assistants to be appointed for each district, will be $222,500.
Inspectors of liquors, &c., will receive a fee for their services from the owners of the goods inspected. If one Inspector be appointed for each district, and his yearly fees amount to $1,000, we shall have a total on this account of $178,000.
In addition to the expenses for officers’ salaries as above estimated, there will be additional outlays for stationery, rent, fuel, &c., &c., which will probably amount to at least $250,000, and that for advertising, &c., to at least as much more.
Salaries of Collectors and Deputies………$1,780,000
Salaries of Assessors…………………………. 278,570
Commissions of Assessors………………….. 44,500
Salaries of Assistant Assessors……………. 835,710
Commissions of Assistant Assessors…….. 222,500
Inspectors’ Fees………………………………. 178,000
Stationery, &c…………………………… 250,000
It is expected that the revenue derived from internal taxes will amount to $110,000,000. The cost of collecting this sum will therefore be, if our estimate be a correct one, about three and one-half per cent of the amount collected. This, though a much smaller proportion than many expect, will amount to a large sum, as the figures above demonstrate.