The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1894-06-27
HILL At IT AGAIN
Senator Vest Argues Ably
in Favor of the In
come Tax.
THOSE SMALL SHAREHOLDERS.
Mr.. Teller Ridicules the Sympathy
Expressed for Them-Allison's
Ideas.
THOSE SMALL SHAREHOLDERS.

WASHINGTON, June "a, 1S94-At 1880 to-
day the Tariff bill was laid before the Senate
the pending question being en- amendment
offered yesterday by Mr.. Allison rep, Iowa.,
to section 50, in relation to the income tax
on corporations.
Mr.: Hill dem, N.Y. was promptly in
the van, of discussion. He called attention
to the discrimination made in the bill be-
tween incomes from investments in corpor-
ate property and incomes from other
sources. In the latter case, exemptions
of $4,000: but in the former case
there was no such exemption for the
individual, who, if he had dividends to any
lesser amount, would have two per cent. de-
Quoted from them. He could see no reason
for such a discrimination and supposed that
it must be IN oversight. An amendment
ought to be prepared, he said, to remedy
that injustice. He would vote for Mr.. ALI
sons amendment Ito exempt corporations
with capital of less than s100, 900 if he could
get no better, although that would not &C
complish his own purpose. he asked the
Senator from Missouri Mr. Vest if he had
any suggestion to make to cover that point.
MR.. vEsTs's REPLY.
Mr.. Vest. dem, No. stated some general
propositions as to a tariff bill, and said that
his Idea of taxation was that it should be ON
property, On income, and on proportion TO
the protection which Governments actually
gives 80 the citizen. The income tax on
corporations had been in the law Of 1864, n
was in the law of Pennsylvania today-re-
quiring corporations to retain out of
their dividends On stock and bonds
the two per cent. tax, and
to pay it over to the Government.
In other words, every corporation
was made g collector Of the governments
tax. That was the law In the State of
Pennsylvania today, where both stock and
bonds were taxed; and the pending bill,
as ii came ffom the House, had also taxed
the bonded Indebtedness of every corpora
ton; but the Finance Committee had struck
out that provision, and still there was
complaint. Under the law of Michigan a
tax was put on corporations In the same way.
The conIfaittee has endeavered to simplify
the bill apd to strengthen it by putting the
tax directly on the corporation, and by al
lowing che corporation to adjust its relations
with stockhold@s. The committee treated
the corporation as Q legal entity, Tit bill
did not dead with stockholders; 1t dealt with
the corporation as a legal being. As to Mr..
Auispnts amendment, Mr.. Vest said that If
the Beaate Should attempt to discriminate
between large and small corporations, it
would enter into a labyrinth froMa which
there was no escape.
LII. 6bS 4nUt6o q Sp66Vn 01 ocAdbOI
EherHHaa's Ia 1871, stating that aa income
tSaxswas the only tax that tended to eauahze
the Burdens Of che rich and of the poor. He
also read an amendment suggested some
weeks ago by Mr.. Smith of New Jersey
directing corporations to deduct the amount
of any dividend paid to a single stakeholder
not exceeding $4,000 from the amount on
which the corporations were to pay the tax
Such a provision, Mr.. Vest asserted would
be impossible of execution.
ALLIsoN'S IDEA.
Mr.. Allison remarked that II Mr.. Smiths
amendment ts read by Mr.. Vest was
adopted it would effect the purpose which he
Mr. Allison) had in view.
But he modified his own amendment in
some particulars, and argued in favor of it..
He knew perfectly well that a perfect bill
could not be framed; hut how could Sena-
tors, he asked, Justify themselves in making
an arrangement which exempted ~stockhold-
ers with an income of $4,000 and mulcting
those stockholders whose incomes did not
reach 81, 600?
Noticing that Mr.. Harris dem. Tenn.)
was standing, as if prepared to make a mo
ton, Mr.. Allison said:-"f the Senator
from Tennessee wants to move to lay my
amendment on the table, / will withdraw it. +"
1.-THE Senator Mr.. Harris said, in his
usual slow and impressive style. anticipates
ray object. Irose for that purpose"
Then l withdraw it."
So Mr.. Allison's amendment was with
drawn.
TELLER TAKES A AM
Mr.. Teller rep, Coll ridiculed the sympa-
thy protested for the small stockholders of
corporations, and intimated that it was got
up not in the interest of the small stock
holders, but of the large ones. If a small
~stockholder received an annual dividend of
$500 he would not grumble at having to pay
a tax of 81 a year on it. AS to railroad
stocks, he said that no poor wise man ever
bought them. They were not for
Investment, but for management.
One of the financial papers had
recently published a list of railroad
stocks in the United Stats aggregating
S75s, 600, 000, and most of which had been
marked up at par, and which now could be
bought at ten cents on the dollar, and was
not worth, intrinsically, four cents or two
cents on the dollar. He hoped to see the in
come become a firm fixture in the none
tary system of the United States because it
was the most equitable and just system for
the collection of revenue that could be de-
yised by man.