Andre Woods, age 13, of Peoria, I11., for his question:

ARE THERE MANY KINDS OF TAXES?

In 1895 the Supreme Court of the United States ruled that an income tax law in effect was unconstitutional because it was a direct tax not apportioned according to population. In 1913 the 16th Amendment to the Constitution removed this restriction, and the first modern federal income tax in the United States went into effect that year. The tax is still in effect.

Taxation is the way people pay the expenses of carrying on the government. In the earliest days of history taxes were paid in goods rather than money.

Taxes may either be direct or indirect. A direct tax is one that the taxpayer pays directly to the government, such as the federal income tax. An indirect tax is one that is paid by a manufacturer who then passes its cost on to the buyer of his product.

A tax is called proportional if the rate of taxation remains the same whether it is applied to a small sum or a large one. The amount collected is proportional to the sum to which the tax is applied because the rate is constant.

A tax is called progressive if the rate of the tax goes up as the sum to which it is applied increases. The federal income tax, again, is the commonest progressive tax because its rates are higher for large incomes than they are for smaller ones.

A tax is called regressive if the rates are lower when applied to a larger sum. An example of this is when a wealthy person uses his income in ways that are not subject to a sales tax. A low income person must spend most of his money in ways that are subject to the sales tax, such as for food and clothing.

One of the most important single sources of revenue for state and local governments comes from property taxes.

Taxes are levied on inheritances and also on estates before they are divided among heirs. Sales taxes can be applied to services such as a barber or even a doctor. And sometimes special sales taxes are put on luxury goods.

There are many more types of taxes including the excise taxes which are placed on specific commodities, custom duties which are placed on imports or exports and license taxes which are placed on the right to do something, such as get married or own a dog.

Economists agree that certain desirable principles must be in operation for taxation. It should be possible to expand the tax system to collect more money during periods of emergency or reduce the amount of taxes in normal times.

A tax system should be simple as well as stable. A taxpayer should know in advance what his taxes will be so that he can save money to pay them. The taxes must also be fair.