The sun., 1909-06-17
TAFTDIVIDES INCOME TAKERS
HIS MESSAGE ADVOCATING TAX
on CORPORATION EARNINGS

lAIbu SOHstitutOHul A"eHuhS" T'V-
,iding for an Income Tax-HIs Plan
sure TO Get Some Democratic Votes
--BaiIey-to Get Vote on His scheme.
WASHINGTON, June i6.-Preeident Taft's
expected message advocating the imposi-
ton OF per cent. tax on the net incomes
Of corporations and recommending the
adoption OF joint resolution submitting
to the people Of the States the question
OF amending the Constitution to permit
Congress to levy tax on the incomes OF
individuals was sent to the Senate to-day
II mas apparently killed the last hope
Of the Democrats and those Republican
insurgents who had entered into COM
bination for the purpose OF enacting a
law directing the immediate levy OF an
individual income tax. The Presidents
attitude is very gratifying to Senator
Aldrich and his following OF Republican
regulars in the Senate. as it furnished the
influence they desired to enable them to
carry out the programme they had
arranged OF crcumventing the Demo-
cratic and insurgent Republican plan OF
putting an income tax law on the statute
books.
In his message the President, while
not admitting that the imposition OF an
income tax at this time would be uncon-
stitutional. takes the ground that in view
Of the decision of the United States su-
preme Court declaring that the income
tax law OF 1894 was contrary to oonstitu-
tional stipulation the proper course to
pursue Is to submit to the States the mat
ter OF amending the Constitution. He
suggests that the enactment Of an income
tax law at this time would be in the nature
OF a reflection on the Supreme Court.
The President says: Il have become
convinced that a great majority OF the
people of this country are in favor OF
investing the National Government with
power to levy an income tax and that
they will secure the adoption Of the amend
ment in the States il proposed to them
As to the proposed per cent. tax on the
net incomes OF corporations MIR. Taft In
advocating it makes the point that in ad-
dition to providing revenues amounting
to not less than s2s 900 900 it will furnish
the means OF a closer supervision OF the
accounts and business transactions OF
corporations. He argues that such
law would not be incompatible with the
provision OF the Constitution which in
the case of the tax on individual incomes
the Supreme Court found to apply a.
versely.
MESSAGE REFE RREp TO F1NAScE COM.
MITTEE. -
The Senate suspended the consideration
OF the tariff bill to have the message
road. and the Senators. nearly all OF
whom were in their seats, gave the
closest attention to what Mr.. Taft had
to say. When the reading was finished
Senator Root who was in the chair.
announced that it would be referred to
the Committee on Finance. Immediately
a parliamentary wrangle arose over
motion of Senator Gore Of Oklahoma.
one Of the most radical Democrats, that
the Finance Committee be instructed to
report provisions in accordance with the
Presidents recommendations.
Senator Bailey, leader OF the Demo-
Gratis in the fight for an income tax. said
he would vote against Mr.. Cores motion
unless the direction TO have the committee
follow the Presidents Recommendations
was eliminated.
Mr.. Gore consented and his motion
as put to the Senate provided that the
should be referred to the, Fl
nance Committee with instructions to
report its conclusions before Friday.
Senator Aldrich moved to lay this motion
on the table, he and the Republicans
taking the position that a simple refer
ence Of the message to the Finance Com
mittee without instructions Of any sort
was all that was necessary. MIR. Cores
motion was laid on the table by vote
Of 81 to rs. u strict party division. Even
such radical income tax Republicans as
Senators Borah. Cummins and La Fol
lettc followed MIR. Aldrich's lead. All
the Democrats present voted with MIR.
Gore.
The message was then referred to the
Finance Committee in accordance with
Mr. Roots previous ruling aud imme-
dately thereafter Mr.. Bailey served
notice that when the committee/reported
back a joint resolution to amend the
80 "a to enable Congress to
enact an income tax law he would oher
as substitute provision for a graduated
income tax to be levied Immediately.
DEMOCRATS IN CONFERENCE.
At the first opportunity after the read
ing Of the message the Democratic Sena-
tors began informal conferences among
themselves to determine what course
they should pursue toward the programme
which the Finance Committee will adopt
in accordance with Mr.. Taft's recommen-
dations. Some OF them made a canvass
of the insurgent Republicans who favored
an immediate income tax and brought
back the information that as far as they
could ascertain only sevea insurgents
wore likely to remain true to the agree
ment to vote with the Democrats on tho
Bailey -Cummins amendment TO impose
a tax on individual incomes without
waiting for constitutional amendation.
II did not require this information.
however, to convince a good many Of
the Democratic Senators that Mr.. Taft's
message had won the fight for the Repub-
lican organ ization. As a matter OF fact
several OF the Democrats expressed the
belief that II would be unwiso politics for
them to vote against the adoption OF the
suggestions. Thoy took the
ground that II they did so the Republicans
would cite the fact In the forthcoming