税务外文文献

1944]
BOOK REVlEW^S
177
The author has made no attempt to treat this most recent program for taxing the excess profits of business in an extended manner, nor has he undertaken a detailed analysis of the shifting and incidence of the tax. He is, however, well justified in delimiting his treatment of the subject^ for it will be some little time before the history of this latest American venture into the field of excess profits taxation can be properly appraised, and it will most certainly be necessary for someone to undertake extensive research of an inductive character before many of the uncertainties which obscure the economic effects of this tax are clarified. Measured by the criterion of yield, the excess profits tax of World War I was highly successful, and there is no substantial evidence that it inflicted serious economic injury upon any group of taxpayers, in spite of^ the many annoyances which resulted from the defective character of the legislation and from poorly coordinated attempts at enforcement. No doubt the evolution of other taxes, some of them now major components of the federal revenue system, will reveal difficulties in definition and practice quite as perplexing as many of those which limited the effectiveness of the first excess profits tax laws. The whole situation has been complicated by the fact that there has been little inclination on the part of business men to accept the excess profits tax on any other basis than as a purely emergency levy to be discarded as soon as the pressing need for additional public revenues has passed. Furthermore, as the author makes clear, there has been no substantial agreement among legislators and taxpayers as to what constitutes an appropriate measure of excess profits. It may well be said that if this levy becomes a fixture in the national tax system, excess profits will be variously measured according to whether the government has under consideration peacetime or wartime revenue needs, for there is abundant evidence that profits of a so-called nonnal period cannot be taxed fairly by the same standards as those which apply to periods of war. If these distinctions w^ere given legal sanction it would contribute substantially to sound administration and economic justice, both of which were sadly lacking during the early history of the excess profits tax, but it would also introduce an element of long-range fiscal planning which has not been a conspicuous feature of federal finances up to this time.
178
THE AMERICAN ECONOMIC REVIEW
Í MARCH
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Professor von Mering, as his title may seem to imply, succeeded in offering the long waited for general and systematic view? Has he developed an original conception or, at least, blended the opinions of various schools of thought into a timely compromise? If we judge only from the pattem of presentation, a full synthesis may seem to have been achieved. It is fitting for a systematic treatment to start with methodological considerations. The first part promises nothing le?s than "the general theory of tax shifting." The author proceeds step by step, beginning with such an oversimplification as Boehm-Bawerk's exchange between one seller and one buyer haggling about one indivisible good. In the following sections, other market conditions are introduced, with emphasis on pure monopoly and pure competition. In contrast to most recent writers in the field, the author shrinks from the application of the monopolistic conu petition approach. As he frankly admits, "the theory of monopolistic competition, as expounded by Mr. Chamberlin, is not a very fruitful basis of investigation concerning tax shifting" (p. 76, note 1). Perhaps lie Vvould have revised his skeptical attitude if, before the completion of his work, he could have consulted John F. Due's valuable monograph. The Theory oj Incidence of Sales Taxation^ reviewed in this joumal in September 1942 (pp. 604-606). A large number of cases are carefully examined by Professor von Mering with the help of numerous charts. At least occasionally, marginal analysis is quailfied by taking account of less abstract conditions. The numerous delicate economic miniatures, used for illustrative purposes, seem to me the greatest achievement of the author. They may be useful in training university students in the marginal approach. WTiile the first part is the core of the study, the second part is designed ÎQ supplement and verify the "general theory." It deals with less "typical'' cases by examining the s^hifting of various kinds of taxes: on agriculture^ real estate, trade, industry, labor, wealth, income and transactions. Generalization and systematization, however, are more apparent than real. It seems surprising that such a broad study has been completed without any attempt to define the concept of tax shifting. The author simply contends that no "unequivocal definition" can be offered and then finds consolation in the thought that a search for a definition "constitutes but a waste of time and energy" (p. 2). Consequently, the analysis is hampered at the outset in determining its field of examination, in classifying the various processes and in segregating incidence and economic effects of taxation. With regard to the first problem, however, the author submits a superficial suggestion: "The economic effects which follow from the moment of the impact of a tax until the ultimate incidence of that tax constitute the subject matter of the theory of tax shifting. The further effects, that is, those which may follow the placing of the ultimate burden of a tax on certain persons or groups are no part of the theory of tax shifting" (p. 3). Apparently, the author believes that the difference between the two groups of processes can be simply stated in terms of time. By following him, however, we are led to strange conclusions. A new protective import duty may immediately curtail the