The times. [volume] (Washington [D.C.]) 1897-1901, 1901-03-31
THE TAX ON BUCKET SHOPS
New War Revenue Law to 60 Int,
Effect Tomorrow.
Many Local Firms Interested-Nust
Pay Heavy Extra Assessments and
Also File sworn Statements rs to
the Nature of Their business

many Local. ftrms lnterested-Nusf
Pay Henvy Extra Assess,sents and
Also File sworn Statements rs to
the Nature of Their business
The provisions of the new revenue law
relative to special taxes on ''hucket shops
will go into effect tomorrow, April /, and
the local banking and brokerage fra
ternity generally is very much interested
strue the law, and in It's effect on this
usually frowned on off-shoet of the
| brokerage business.
There are large number of stock
! brokerage offices in Washington. Some of
them are simply branch Offices of New
| York Stock Exchange firms, and are sup
! posed to do a strictly commission business
of buying and selling stocks on the stock
| exchange. Others are correspondent"
of New York firms that have no member
ship on the New York Stock Exchange.
| a third class OF local brokerage firms do
not pretend to have correspondents any
where, but themselves do a bucketshop
| business. Many questions are arising
| among the brokers, and also at the office
! of the Internal Revenue Commissioner, as
| to the status Of these various firms. The
| District Attorneys office is said also to
| be considering the question if the new law
will make it possible to convict the
bucket shops and drive them out of bust
| ness
The interests involved are very large.
| The number of offices of ali kinds in the
city is perhaps twenty-five. Their olume
| of business varies greatly, both as to diff
| ferent firms and as to the same firms at
different seasons of the year. 1t is esti-
in artiu rlsnt
| such the present the volume of bust
ness daily is from 5000 to 250eO shares of
| stock. This represents the use of perhaps
| $4,000 daily of margins for customers
and a very much greater fixed amount of
| capital employed by the brokers. 1t is
| said that the customers of the local
| brokerage offices generally lose in the
long run, and 1t is estimated that their
losses probably aggregate s1o0o.0e0 to
100000 year. The same conditions ex-
list In every other city in the country. so
that the aggregate of money involved in
the construction of the new law is very
great.
1t Is said by some of the people familiar
with the way that the bucket shop pro-
vision Of the new law was originated that
its object is simply and solely to kill the
bucket shops. One statement made by
pioned zealously by New York Stock Ex-
change interests from the beginning The
Stock Exchange and other exchanges and
boards of trade throughout the country
have been fighting the bucket shops for
many years without much success. but up
to the present time they have never in
voked the aid of the Federal Government
The new measure is. of course, ostensibly
simply new method of raising revenue
1t is provided that bucket shops, shall
pay special yearly license, and that in
addition they shall pay a separate tax on
every transaction they conduct, the latter
being double the tax imposed on the regu-
lar commission brokers. A considerable
additional revenue will be realized in this
way, it is thought, though there are some
skeptics regarding this poias.
But ii is not in the matter Of additional
revenues to he derived from these places
that the measure is particularly interest
ing. 1t is at this point that the alleged
war on the whole bucket shop industry is
supposed TO crop out. The law provides
that every bucket shop must declare itself
as such. II also provides that the books
of all brokerage offices snail be opened
TO the inspection of the Government in
spectors. so that there shall be no ques-
are laws in nearly all. il not all, States
against gambling. In some there are spe-
cial acts against bucket shops as such
Up to the present time 1t has been almost
impossible to convict the places. because
of the inability of the authorities to prove
the nature of their business. IT is said
now, however that If, in obeying the
Federal law, the bucket shops put them
selves on record as such they will give
the local authorities all The evidence that
they will need that the state laws are
being broken.
The new law is. In part. as follows:
Prom and after the first dav Of April |
1901. every person. association. conartner-
ubi, or co,,,or,,i,,, NJ, a.. ,,hinh s,,alt
"i'' VI "' ~
III ms us OF ther own behali' or az
agents, engage in the business of making |
OF Offering to make contracts agree |
went. ,a1. 80, ..,,, e',,,. |
"a 'A'''7 'eSPSN''s
'he purchase OF SAFE, or purchase ana |
sale, OF any grain, provisions, raw or I'M |
manufactured cotton stock bonds or /
- a..i,, -, -. |
WHEREIN po'i ''i'i''
lhere'o' OF such person. association CO. |
partnership, or corporation above named, |
contemplate or intend that such con-
, ,,,, ,.,.,, -.
no =, y,
lions shali De or may be closed, ADJUSTED, |
or settled according or with reference to |
the public market quotations of prices
made an am, hoo,1 80 -, ~. a,oia,,,,a |
-, ' u "
upon winch the commodities OF securities
referred to in said contracts, agreements, |
trades or transactions are dealt in and
without n bono ia ,ra,saotf,,, .o,, s,,,t,
-,
Doaiu VI 'Idue OF eAcHanSe' OF wherein |
both parties. or such person, association,