The Washington times., 1909-06-22
indications Point TO Effort
at Postponement Until
Next Session.
SENATOR BAILEY
EXPECTS ACTION
Hot Weather Believed to Be Cause
of Present Movement Among
Solons.

That an effort will be made TO shove
the whole corporation tax question, and
with 1t the income tax question. over
until next session Of Congress is the
talk about the Senate today.
AS Vet, the Senate leaders have not
framed a plan 10 take this step. At any
rate, they are rot admitting that they
will take such a course. But the talk
among Senators IN the cloakrooms and
corridors today is that an attempt viii
be made TO postpone action until the
regular session. For several days talk
Of this sort has been rife
It is growing more and more common
as the weather gets hotter and Senators
see stretching out before them the IN
inviting vista Of endless discussion OF
the whole samut of corporation control
matters with the Thermometer lowering
about 80 degrees in the shade Even
staneh patriots wilt slightly at this
cherries prospect.
Bailey Expects 1t.
It IS known that Senator Bailey is
looking for an attempt to put the spe-
cial tax question over. He made it clear
today that he expected an attempt would
be made to do this. Senator Bristow
said he had not heard of an attempt TO
put the matter over. But other Senators
said they had no doubt this effort would
be made. Moreover. 1t is generally ex-
pected that the attempt to put the ques-
ton over viii lead 10 strong opposition
and, perhaps. add to the complexities OF
an already complex situation
One difficulty that will arise II an at
tempt is made TO put the special tax
question over is that the cry will be
raised at once that postponement is a
scheme for avoiding any legislation
at all on the subject. The Senate Dem
ocrats are expected TO fight postpone
ment and no doubt some Of the insur
gent Republicans will do likewise, not
because they like the corporation tax
but because they regard any plan that
does not contemplate settlement Of the
matter now as a flank movement in
tended 10 shut on any legislation.
Taft An Obstacle.
Another difficulty that arises in the
way of postponement Is found IN the
fact that President Tart desires the
net earnings tax enacted in order to
get the additional revenue at once. If
the question goes over, there viii be
no returns from the net earnings tax
until a year from July. or until the
beginning Of the fiscal year opening
July ], 1910. This would deprive the
Government Of sadly needed revenue
at a time when il is needed worst.
The lowest estimates made today on
the discussion that will be required TO
pass a corporations tax measure are
from two to three weeks.
1t was pointed out by some Senator'S
that ia political way 1t was desirable
that the proposed legislation be put
through this session and that President
Taft would be criticised in many quar-
ters II nothing were done and the mat
.
Much interest attached today &c the
conference which VIII be held at the
White House tonight. At that confer
ence II IS expected President Taft Will
supervise the operation OF putting the
finishing touches on the net earnings
tax amendment. Those at the confer
ence VIII be Attorney General Wicker
sham and Senator Root, who are draft
ing the amendment; Secretary Of State
Knox, and the Republican mem ers of
tile Finance Committee headed by Sen
ator Aldrich.
Features Outlined.
AS the result Of conferences. YESTERDAY
and last night the essential features of
TIE proposed net earnings tax have been
outlined It is agreed that il shall ap-
Dly To all corporations. except that cor
porarrons with an income or less than
$500 year are to be exempt
II viii be provided that all corpOra %
tons must make returns to the Govern
ment. This is for the purpose Of pre-
venting any. corporation from escaping
legitimate taxation. Il will be provided
that Government inspectors shall have
the right TO probe the books Of ali cor
pOrations.
compromise plan Is being worked
out as to bonds. The interest on bonds
which do not exceed the amount OF the
capital stock as a corporation is 10 be
deducted from the net earnings before
the tax is assessed. This will prevent
corporations turning their stock into
bonds to escape the tax.
II IS now expected the amendment will
be introduced In the Senate not later
than Thursday.