The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1909-06-23
TAFT MEASURE
FOR TAXATION
IS DRAWN Up
Conference at the White House
of Leaders Who Will Try to
Jam 1t Through.
DETAILS OF THE NEW
SCHEME ARE LACKING
BUT 1T is A ? PER CENT TAX ON
NET EARNINGS OF CORPORA
TIONs IN EXCESS OF $4,000.

Washington, June "Details of the
proposed measure for the taxation Of
net earnings of corporations were ar
ranged tonight az the most important
conference that has been held at the
White house since MIR. TAFT assumed
the presidency.
There were present as the presidents
guests at dinner Attorney General
Wickersham and Senator Root who are
charged with the work OF drafting the
measure; Secretary Knox, Senators Al
drich, Burrows, Penrose. Hale. CullGm.
Flint, McCumber. Smoot and Lodge.
Speaker Cannon. Representative Payne
and Representative John Dwight of
New York were also present.
For two hours the corporation tax
measure, which had been prepared in
the form of an amendment TO the tariff
bill. was viewed from every angle.
Many changes i'm form were suggested.
The carefully prepared copies given to
each member of the party by Attorney
General Wickersham were returned to
him at the end of the conference.
viii Be Kept Secret.
President Taft himself suggested that
the copies should not be taken by the
members of the party until the amend
msnt had been perfected. All agreed
not 10 make the form of the amendment
pa iic until il is ready to be introduced
I'm the senate.
The terms Of the measure provide that
all corporations having capital stock
and organized for profit shall pay a tax
of 2 per cent on their net earnings. Cor
porations coming within that designa-
ton viii be compelled TO make returns
to specially named agents of the bureau
of internal revenue of the treasury de-
partment, giving the amount of their
gross receipts. capital stock bonded in
debtedness and all other visible debts.
The amendment win define in the
broadest possible way the character of
losses which may be deducted from the
net earnings uDon which the tax is TO
be collected
The . per cent tax will apply 10 all
corporations organized for profit. but
each corporation will be allowed
$1,000 exemption.
Penalty Not Fixed.
Any corporation which makes a false
report Will be subjected to a penalty, the
amount Of which was not decided to-
night. Most Of the participants in the
conference expressed the opinion that it
should range from $1,000 to $4,000.
The tax viii be collected upon the
entire amount of preferred and common
stock OF every corporation and upon the
bonds of a corporation where they ex-
coed the total amount of capital
Il is intended that the bill shall be-
come operative Immediately on its
passage, The life of the measure was
made indeterminate. The present years
tax viii be collectable July /. 1910.
Leaders in the senate and house have
been flooded with kilograms from cor
poraJions expressing fear that the law
would be drawn I'M such form that m
sCrupulous ageD Is of the internal rev
enue bureau might use information so
as 10 injure the business Of corpora
ton. This was discussed tonight. and
il was decided that only especially des-
isnated agents of the bureau should be
permitted To interrogate corporations
concerning their business.
Insurance Companies Included.
1t was decided that all Incorporated
insurance companies organized for pro-
III shall be brought within the terms
of the proposed corporation tax law.
This viii not exempt sO-caIled mutual
insurance companies. Neither will if
exempt fraternal insurance concerns.
which come within that Interpretation
of the law
Estimates given tonight place the
probable amount that would be raised
by the proposed . per cent tax on net
earnings Of corporations at from S25,-
100000 to $4,000, 600.
Neither the senate nor house leaders
undertook To forecast the length Of time
which viii be required to pass this
measure through congress.
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