New-York tribune., 1909-06-30
CORPORATION TAX
NOW BEFORE SENATE
MADE REGULAR BUSINESS
By TECHNICAL MOVE.
Viii Pass, Says 4Idrich. but VII
Be Repealed or Modified
an T1cO Years.
From The Tribune Bureau. ]


amendment for a tax of per cent on the net
earnings of corporations is now the unfinished
business before the Senate. It is expected that
vote on it's adoption will be taken within ten
DAYS. and unless there is a marked change IN
sentiment before the close of that time. the
amendment drawn by Attorney General
Wickersham. President Taft and Senator Root. !,
will be adopted The leaders are hopeful but
not certain that a vote on the amendment can
be taken before the close of this week.
Senator Aldrich is so confident that no CON-
bination can be made 70 defeat the amendment
that he will leave Washington tomorrow for
a few davs of rest Senator Flint will be in /
charge of the amendment for the Finance Com
mittee and Senator Root will be on hand to
reply 70 such criticisms as may be made against
the constitutionality Of the L.easure. II is not !
the purpose Of the leaders 10 make exhaustive
speeches in support Of the amendment In fact
they are willing that Vpte shall be taken az
once and will content themselves with brief
replies to criticisms Of Senators Cumrnins.
Borah. Bailey. Rayner and others who have
given notice of their purpose to attack tbs
amendment
An important tactical advantage in the par
liamentary status of the amendment was
achieved by the Finance Committee to- day, pur-
suant to its purpose to accept no amendments
The advocates of an income tax fully expected
that they would be able 10 bring about a direct
vote on the Bailey -Cummins amendment before
the corporation tax amendment was voted on
and falling that. to offer nunler Of amerd-
ments to the Taft proposition When the
schedules and free list were finished in the
committee of the whole to-day. the Bailey
Cummins amendment was laid before the Sen
ate as the pending business Immediately Mr.
Lodge offered as a substitute for this amend-
ment that portion of the Payne bill which pro-
vfdes that whenever any country pays bounty
on a dutiable article imported into the United
States there shall be levied an additional duty
equal to the net amount Of such bounty. Mr..
AIdrch then offered the corporation tax meas
rre as an amendment to the Lodge substitute
This precIudes the offering OF any amendment
to the corporation tax measure il being Itself
an amendments and not amendable under the
rules. This means that the Bailey -Cunan1ins
amendment cannot be considered until the Sen
ate has adopted or rejected the corporation tax
amendment With the corporation tax amend
ment adopted the leaders have no doubt that
there will be a decisive majority against any
additional legislation for special taxes
SITUATION PLEAsEs LEADERS
The leaders were elated over their success in
bringing about this situation. which care
fully planned in committee more than week
ago. It means. they say. that the corporation
when the vote is taken in committee of the
whole. Many Democratic Senators have de-
cIared that while the corporation tax measure
does not go as far as they wish. they will Be
compelled 10 vote for it. It is possible, the lead
ers assert. that the entire Democratic side will
swing into line for the corporation tax measure.
and that on the first roIIcaII in committee OF the
whole not to exceed eight votes viii be cast
against It,
Several times in the COuse Of the debate to-
day Mr.. AIdrich let it be known that while he
would vote for the corporation tax he had not
changed his mind TO the power of the new
tariff bill to raise all revenue necessary to meet
the expenses Of the government He would sup
port the. measure as a means Of defeating
the income tax Replying to questions OF
Mr. Bailey, the Rhode Island Senator said
he expected to see the law repealed at the
end of two years. or at least to see the rate
greatly reduced. while some of the best features
of the law were retained Mr.. Bailey wanted
Mr. AIdrich 10 admit that the President had
suggested the corporation tax measure as a
means of defeating the enactment of in
come tax law. He wanted to know whether the
President had suggested the corporation tax
amendment 10 the President or the President
had suggested it to Mr. Aldrich- The Rhode
Island Senator replied that the President had
suggested such tax to the Republican mem
before the tariff bill reached the Senate
Later in the day. when Mr.. Cummins was dis
cussing the governments fiscal affairs. Mr.. Al
drich said he was convinced that if the sched-
ues of the tariff bill as framed by the Senate
in committee OF the whole were approved by the
Conference Committee the customs duties would
be S15.OO0OO0 more than under the Dingley law.
He said this was S7.OOOOOO more than the esti-
mate made by him when he reported the bill TO
the Senate. He was willing to risk his repUta-
ton as a prophet on the statement that the
pending bill would yield more than S3JOO0OOO0
annually in customs receipts.
MR. FLINT EXPLAINS PROVISIONS
As soon as the corporation tax amendment
was introduced Mr. Flint made short expIana-
tion of it's provisions He said the Finance
Committee had given careful consideration to
the question of special taxation The decision
of the Supreme Court in the Pollock case was
regarded as conclusive against any recommen-
dation for an income tax, while inheritancs
tax. he said. did not seem desirable because
many of the states already taxed inheritances-
Some members of the committee. Mr. Flint said.
were opposed TO any special taxation because
they believed the tariff bill would provide ample
revenue majority of the committee was not
satisfied that the customs duties would yield
sufficient funds to maintain the government and
had accepted the Presidents recommendation
for tax on the net earnings OF corporations.
Replying to questions. Mr. Flint said that the
inquisitoriaI provisions OF the amendment had
been carefully drawn He said that revenue
AGENTS would not make examinations merely 70
punish somebody or TO satisfy idle curiosity
and the governments agents could examine only
such books as were necessary to satisfy them