Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1909-06-18
Recommends Two Per Cent Tax
On Net Income of Corporations
And Provides for an Inheritance
Taxation.
INABILITY OF CONGRESS
TO REACH AGREEMENT
MOTIVE OF MESSAGE
Taft's Suggestion Does Not Pro-
vide for an Apportionment
Among the Several States--Full
Text Of the Message.
CRr As.oeiatsd Pr.a..l

CSy Associated Press.j
WASHINGTON, June Is.-Recommend-
fng legislation looking to the placing of
per cent tax on the net income OF
corporations and also the adoption Of an
amendment to the constitution providing
Cor the imposition of an income tax with
out an apportionment among the several
states. President Taft today sent to con-
gress a message embodying his views on
the subject This action followed a pro-
tracted special meeting of the cabinet.
In his message the president speaks on
the apparent inability Of congress TO agree
10 an inheritance tax and as regards an
income tax he refers TO the decision of
the supreme court in the case of Pollock
vs. the Farmers Loan and Trust COM
pany. in which the court held the tax to
be unconstitutional unless apportioned &C
cording to population
1T IS" says the president. "undoubt-
edly a power which the government ought
20 have. II might be indispensable TO the
nations life in great crises"
THE ONLY PROPER COURSE.
The amendment. therefore. he de-
eIares. was the only proper course.
Such an amendment TO the constitution.
he contended. was preferable to the one
proposed Of reviving a law judicially
declared 10 be unconstitutional
The amendment which he proposes
should be made to the tarif bill pro-
vfdes for the imposition upon all cor
poratfons and joint stock companies for
profit. except national banks otherwise
taxedl. savings banks and building and
loan associations OF an excise tax OF
per cent on the net income OF said
corporations. This. 1t is estimated by
him. will bring an annual revenue OF
s25.e0o.0o0. This is tax on privilege
and not on property" he says. and is
within the federal power without ap-
portionmeut according 20 population"
GIVES ANOTHER REASON
The president points out that another
merit 20 the tax on corporations Is the
federal supervision. which viii give to
the government the stockholders and
the public knowledge Of the real business
transactions and the gains and profits of
every corporation In the country. The
adoption Of the amendment. he says. win
make a long step toward that supervis-
ory control Of corporations which may
prevent q further abuse of power
READ BEFORE THE SENATE.
The presidents message was brought
into the senate about I'D O'Clock. while
Senator Burton was making a speech In
opposition to a duty on zinc ore. Senator
Root. being in the chair. ordered the read
AAk CT Nue uOEuulGlL a soon as OHlu
senator ceased speaking. Many senators
were at luncheon in the restaurant and
Senator Lodge caused the full senate to
be called in TO hear the reading by sug-
costing the absence OF quorum.
when the purpOrt OF the message was
made known. both Republicans and DEM
ocrats remained in their seats. and all
lnstened atcntively to the reading.
Upon the completion Of the reading Of
the message. Senator Gore moved to re-
fer II 10 the committee on finance. with
instructions 10 report by next Friday
resolution for an income tax in accord
ance with the presidents recommended
ton A motion by Senator Aldrich to
lay Mr. Cores motion on the table was.
on an ave and no vote carried oy 81 10
g. a strict party vote.
THE TEXT OF THE MESSAGE.
The text Of the message follows;
TO the Senate and House Of Repre-
sentatives:
Tt Is the constitutional duty OF the
president from time 10 time TO recommend
10 the consideration Of congress such
measures as he shall judge necessary and
expedient In my inaugural address. im-
TnedIately preceding this present extraor-
binary session OF congress. invited atten-
ton TO the necessity for q revision Of the
tariff at this session and stated the prin-
cipIes upon which I thought the revision
should be effected
i referred TO the then rapidly increas-
ing deficit and pointed out the obliga-
ton on the part OF the trainers Of the
tariff bill TO arrange the duty so as to Sc
cure an adequate income. and suggested
that II II was not possible to do so by
import duties new kinds Of taxation must
be adopted and among them j recon-
uended a graduated inheritance tax as
correct in principle. and as certain and
easy OF collection
WHAT THE HOUSE DID.
The house OF representatives has adoP-
ted the suggestion and has provided in the
bill Il passed for the collection on such
a tax In the senate the action of its
finance committee and the course of the
debate Indicate that IL may rot agree 70
this provision and Il Is now proposed TO
make up the dvficit by the imposition OK
a general income tax in form and sub
stance OF almost exactly the same char
acter as that which in the case of Pollock
W. Farmers Loan and Trust Co, IL. 81
l. s. l29) was held by the suprem ecourt
20 be a direct tax and therefore not with
in the power OF the federal government
70 impose unless appOrtiOned among the
several states. according TO population
This new proposal. which I S1d not dis
cuss In my inaugural address or in my
message at the opening Of the present
session makes IL appropriate for me &c
submit to the congress certain additlona.
recommendations.
THE COURT DECISION.
The decision OF the supreme court I'm
the income tax cases deprived the nation
al government of a power which. by rea-
son OF previous decisions OF the court. Il
was generally supposed the government
had. IL Is undoubtedly a power the ma
tional government ought to have. IL
might be Indispensable 10 the nations
life in a great crisis. Although I have
not considered a constitutional amend
ment as necessary 10 the exercise OF GER
tain phases OF this power. a mature con-
sideration has satisfied me that an
amendment Is the only proper course for
its establishment TO it's full extent /
therefore recommend 10 the congress that
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