“What does that mean?” inquired Willie.
“Simply this. The import duty is eighty or ninety per cent. of the original value of the goods. If an article is worth ten dollars, say, and the import duty is eighty per cent., the importer would have to pay a tax of eighty per cent. of ten dollars, or eight dollars, to get the stuff in. So he would have to have eighteen dollars merely to cover the purchase price and the revenue tax.”
“Whew!” whistled Willie. “Are import duties as high as that?”
“No, not all of them. Some are very low. It just depends. Articles of necessity, like food, pay very little duty and often none at all. But articles of luxury, like silks, laces, linens, and so on, pay very heavy duties. It takes a pile of money to run this government. If everybody was taxed directly, and had to pay in dollars and cents, right out of his pocket, there would be a tremendous howl. So Uncle Sam gets part of his money through indirect taxes, like import duties. That places the tax burden where it can best be borne, too, for poor people cannot afford many luxuries. The well-to-do pay a great deal, merely for the privilege of wearing fine clothes and having beautiful objects in their houses.”
Just then the arrival of a caller at the gate cut short the conversation, and Willie thought no more about the matter until the next time he saw an Armenian woman making lace on a doorstep.
“I understand now why these Armenian things are so cheap,” thought Willie. “The women make them here and there is no duty to pay on them.”
The woman who was knitting saw Willie looking at her laces. “Only two dolla,” she said, holding out a beautiful piece of lace for Willie’s inspection. “Cheap.”
“It sure is,” said Willie. An idea came to him. “How long did it take you to make this?” he inquired.
“Maybe one week,” said the woman. “Don’t know exactly.”
Willie handed the woman back her laces, thanked her, and went on. Presently he stopped dead in his tracks. There were only a few of these Oriental women, relatively, and yet their shops contained large quantities of needlework. It was as plain as could be that these few women never made all that lace.