The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1894-06-27
Claiming that 1t Was Discrimination in
Favor of Government Securities, but
the Senate Rejected His Motion.
DEBATE ON THE INCOME TAX
Several Changes Made and Others
Not Yet Acted On.
Senate Bill Making Labor Day Ma
tiOnaI Holiday and Deficiency Appr0-
priatiOn Bill Passed by the House.


mometer standing at IS degrees in the Sen
ate chamber to-day the Senate entered upon
the thirteenth week of the tariff debate AT
the opening of the session Mr.. Allen made
another Intellectual attempt to secure con-
sideration for his resolution directing the
Secretary of the Treasury TO inform the
Senate of the total number of persons en-
gagged in protected industries whose inter-
ests might be affected by tariff legislation.
Mr. Gallinger objected, and Mr. Morrill,
moved to refer it to the finance committee.
Mr.. Allen gave notice that as long as the
resolution remained Enacted upon he would
object to all legislation by unanimous con-
sent. Mr. Morrilrs motion was defeated by
a vote of Is to q.
Then the Senate resumed the consideration
of the income tax provisions of the tariff
bill. Mr.. Hill withdrew the amendment he
offered on Saturday to strike out the pro-
vision exempting the interest on United
States bonds from the operation of the tax.
His object in offering the amendment, Mr..
Hill said. was to call the attention of the
country to the fact that $685. 900 of prop
erty in government bonds were necessarily
exempt from the operation of the income
tax under the law although the ostensible
purpose of the income tax was to reach
enormous investment of capital which the
| income tax could not reach. Mr. Hill then
moved to exempt State. county and muni-
| cipal bonds He argued that taxation OF
| State bonds by the federal government
would be direct attack upon the admins
| ira ion of the States If the federal govern
ment had the right to diminish the value
| Of State bonds and securities 1t had the
right to- destroy them. Aside from the
| question of the exercise of a doubtful power,
| in justice to the States which Senator'S rep
| resented on this floor and upon which this
| tax bore harshly Mr.. Hill thought the
| States should have the right to issue bonds
| without being subject to federal taxation.
Mr. Vest held that State or municipal
| bonds could not properly be exempted from
| taxation.
Mr.. Chandler expressed the hope that
| upon reflection the Democratic majority
would not place State and municipalities
| when they were forced to borrow money
| in a worse position than the United States.
| The United States could now borrow
money cheaper than any country, State.
| corporation or individual. But because it
| occupied this coign of vantage, the gov
| eminent should not bear the credit OF
| States and cities by raising their securities.
Mr.. Mitchell, of Oregon, agreed with
l Mr.. Hill that the taxation of State and
| county bonds was of doubtful constitu-
| tionality.
| Mr.. sherman also agreed with Mr.. HILL
| The more he thought of it, he said the
| more satisfied he became that theA United
| States should not interfere by this species
HILLS AMENDMENT LOST.
| Discussion on the constitutionality of a
| national tax on State or municipal bonds
| continued for some time. and then vote
was taken on Mr.. Hills amendment. 1t
| was lost-25 to 80. Messrs. Gray, Hill and
| Pugh, Democrats, voted for the amend
| ment, and Mr.. Pettigrew, Republican, and
| the Populists against it. Otherwise it was
| strict party VOTE the Republicans for
| and the Democrats against.
Mr.. Hill then modified his amendment
| so as to confine the exemption to State
| bonds. A long constitutional discussion of
| the powers and limitations of federal tax
alton followed, in which Messrs. Hoar,
M9fgs eagh AIR H a aery and to Gray
| empt interest from State bonds was also
! Mr.. Hill then moved to strike out the
| provision for tax on personal property
acquired by gift or inheritance. Lost-26
| The proviso offered by Mr.. Vest last
| week as an amendment TO Section 80, that
in computing the income of any person,
shall not be included the amount received
from any corporation, etc. as interest
dividends upon the bonds or stocks of such
| corporations. etc. if the tax of 2 per cent
has been paid upon its net profits by said
corporation required by this act was
| agreed to-
| An amendment of Mr.. Aliens to permit
| evidence in rebuttal before collectors of
| internal revenue, as to the amount OF in
| comes, was agreed to, as was the Vest
| amendment excluding in the calculation of
| the incomes of banks banking institutions,
| trust companies, life, fire and other insur-
| ance companies. railroad, canal, telephone,
| telegraph and other companies, actual OPP
| Grating and business expenses, losses and
| interest on bonded and other indebtedness.
A committee amendment adopted
| providing that the tax shall not apply Ito
States, counties or municipalities, nor to
CORPORATIONS, companies associations or
| ganzed and conducted solely for charitable,
| religious or educational purposes, including
! sociations operating upon the lodge sys-
tenn. and providing for the payment Of life,
10y s,,c ana ether rds and 70 sne
| Citations and dependents of such members;
nor to the. stocks. shares. funds or secur
| tiles held by any fiduciary or trustee for
| charitable, religious or educational pur-
| poses; to the loans made by building
| and loan associations to their shareholders
| for the purpose Of enabling them 10 provide
| for themselves homes; nor to such savings
| banks, savings institutions or societies as
| SHALL first have no stockholders or men,
bers except depostors and no capital ex-
| cept deposits; secondly. shall not receive
| deposits to an aggregate amount in any
| one year Of more than $1,000 from the same
| depositors: thirdly, shall not allow ac-
| cunulation total of deposits by any one
| depositor exceeding $4,000; fourthly, shall
itors ratably the deposits. all the earn
ings over the necessary and proper ex-
| penses of such bank. institution or So
| ciety, except such shall be applied TO
| surplus, and filthy, shall not possess in
any form surplus fund exceeding 10 per
| cent of it's aggregate deposits
Mr. Allison moved to add to Section 50
the words: And nothing herein shall apply
| to any corporation. company or associa ton
| having a paid-up capital of less than $780,
Co.," Without action on the amendment
| the Senate. 6:10. went into executive
| session. and five minutes later adjourned.
i