The evening times., 1899-09-25

The decision of Commissioner Wilson, of
the Internal Revenue Department, in the
matter Of collecting war tax from brokers,
told exclusively in The Times this
morning, has created a lively discussion
on f Street. The decision is far-reaching
and applies to every broker doing business
in the United States. Commissioner VIII
son said today that he is determined to
strictly enforce the law as the department
has interpreted it, He believes that brok-
ers all over the country owe the Govern
ment money, and if he can, he intends
20 collect it,
Until recently brokers have paid a tax
Of 50 for each 100 shares of stock bought
Dr. sold. The assessment, the brokers claim,
should cover the entire transaction. That
is TO say, the order TO the broker. its trans
mission TO the New York correspondent,
and the return Of the certificates. The
revenue officers do not agree with the
brokers, and they claim that under the law
this operation consists CT two distinct
transactions; that the customer buys from
The broker, and that the broker buys from
he New York agent. Under this interpre-
lation of the law il is the intention of the
revenue officers not only TO claim for such
transactions in the future 81, but to make
he decision retroactive, and TO collect the
additional 50 where it can be done on all
transactions of this character since the war
tax was imposed
w. B. Hibbs & Co, members of the
New York Stock Exchange and other
brokers were visited today by Times
reporter, and asked for their opinions re-
specting the decision of Commissioner W.T.
son. member of the firm of Hibbs & Co.
declared that the decision did not apply
TO his firm, for it never bought stock ex-
cept as agent for client.
That he said makes but one trans
action. A client comes TO us and orders
thousand shares of stock. We buy it for
him in his name. We never own it, We
do not transfer il. and therefore the Sec
ond rule contemplated by the law does not
take place. To make such double trans
action as Commissioner Wilson has in view
il would be necessary for us TO do as some
brokers who are not members of the eX-
change do, buy the stock and then sell it
TO our client, undoubtedly two transac-
tions."
While there is no doubt that this sys-
TEN is now employed by this firm, yet it
is said at the Treasury Department build
ing that the internal revenue officers have
an opportunity for collecting back taxes.
for il is said that the firm has been in the
habit OF telegraphing its orders in a man
ner similar TO this: Buy 900 shares St.
Paul. instead of the telegram reading
Buy 1000 shares, ST. Paul, for JONES'
The omission of the name of the actual
purchaser or client has il is claimed, made
this and other firms in this city liable for
the payment 10 the Treasury of large
sums Of money.
AT the Office Of Paine Murphy & Co. on
Fifteenth Street Times reporter was in
formed that the firm had paid the addi-
uonal 81 tax since ordered to do so last
Thursday. This firm is not a member of
the Stock Exchange, and ii is understood
that all other similar firms have paid the
addioonal tax, as directed by the rev.
enue.-department. The firm has been es-
tablished since February, and the men,
bers have been notified that the Govern
ment Will expect the additional tax on all
transactions since then.
Although the brokers have apparently
submitted to the decision of the Commits
sioneT of Internal Revenue, il is known
that some Of the firms have consulted with
Andrew Lipscomb as to the adyisability of
cOntesting the decision in the courts. 1t is
probable that such action will be taken,
and that one of the grounds upon which
it VIII be based is that the Government
has no right TO examine the private pa
pers and books of these firms for the pur-
pose Of ascertaining whether the alleged
arTearages of taxes are owing