310 THE FISCAL PROBLEM IN MISSOURI

imposition of a similar tax by Missouri could hardly be
expected to aid very much if at all in solving the problem of
bank taxation.
Even though a low-rate tax on intangibles could be levied
in Missouri that would yield an amount of revenue equivalent
to the present yield from the general property tax on intangibles,
 it would not follow that the results obtained from such a
tax would be entirely equitable. It might have the effect of
distributing the tax over a greater volume of intangibles,
since low rates would no doubt result in bringing out a
larger volume of intangibles for taxation, but it is probable
that a large number of intangibles would not be reached at
all, and to the extent that this would be true, a low-rate tax
would not be satisfactory.

The Income Tax
It seems very likely that Missouri will look to the income
tax for a part of the additional revenues that it will need
during the next few years. The yield of the Missouri income
tax can be augmented in three ways; (1) by improving the
administration, (2) by a broadening of the tax base, and (3)
by increasing the rates.
There 1s a widespread belief in Missouri that the evasion
of the personal income tax is a serious problem.! Those who
receive dividends, wages, and salaries from Missouri residents
and corporations are probably reached much more effectively
than are the owners of other intangibles. The reason is the
section of the income tax law that provides for information
at the source. Although there is no reason to believe that all
taxable income from other intangibles would be reported for
taxation if the suggested administrative changes were made
effective, they should contribute toward that result. Furthermore,
 it is probable that at some time in the future it may be
possible to arrange a system whereby the states imposing
income taxes will be able to interchange the type of information
 that is required under the sections of the statutes providing
 for information at the source. If arrangements of this

1 Income tax collections were increased considerably in 1929 and 1930 as a result
of the appointment of field auditors, who are directly responsible to the State
Auditor.