The Birmingham age-herald., 1909-06-23
Important Conference Is Held At White House and Sub-
 jeGt We'll Aired
TWO PER CENT WILL BE
 PAID BY CORPORATIONS
Net Earnings Under $5ooo Will Be Exempt and Shall Report Direct Iy to Treasury Department
 in Washington.

Washington, June 22.-Details of the pro- posed measure for the taxation of net earnings of corporations were arranged tonight at the most important conference held at the White House since MT. Taft assumed the presidency.
 There were present as the Presidents guests at dinner Attorney General Wick ersham and Senator Root, who are charged with the task of drafting the measure; Secretary of State Knox, Sem ators Aldrich, Burrows, Penrose, Hale, Cullom, Flint, Shoot McCumber and Lodge, constituting the republican mem- bership of the finance committed; Speaker Cannon, Representative Payne. chairman of the House committee on ways and means, and Representative John Dwight of New York, the republican whip of the House. The statesmen sat down to dinner at o'clock. No business was dis cussed at the dinner. but for two hours afterward 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 from the form in which it was written were suggested and not few of these were declared to be wise. The result was that the carefully pre- pared copies given to each member of the party by Attorney General Wicker sham were returned to him at the end of the conference.
 President Taft himself suggested that the copies should not be taken by the of tho orfxr he ment had been perfected. All agreed not to make the form of the amendment pub lie until 1t is ready to be introduced in the Senate as finance committee amend ment to the tariff bill.
 Terms of Measure.
 The terms of the measure as finally agreed upon, although not yet whipped into form, provide that all corporations having capital stock and organized for profit shall pay tax of per cent on their net earnings. Corporations coming within that designation will be compelled to make returns to specially named agents of the bureau of internal revenue of the treasury department, giving the amount of their gross receipts, capital stock. bonded indebtedness and all other visible debts. Separate from these returns the corporations will be compelled to report the amount of their net receipts, after deducting their general and ordinary run ming expenses. interest on bonds up to the amount of the capital stock of the corporation, interest on notes and other forms of tangible indebtedness, and any actual loss that may have been incurred t, h11cn vxyl1f of by insurance, salvage or other form of return.
 The amendment will define in the broad est possible way the character of losses which may be deducted from the net earnings upon which the tax is to be col lected. These losses will include bad ac- counts of a mercantile corporations, losses on securities held by banks, uncollectble notes and all other forms of bad debts which are usually charged to profit and loss accounts
 $5000 of Exemption.
 As has been stated before, the per cent tax will apply to all corporations organized for profit, but each corpora tion will be allowed $5000 exemption, which means that the tax will not be collected except upon earnings in ex- cess of $5000.
 Any corporation which makes a false report to an agent of the bureau of in ternal revenue who has been designated to collect information regarding earn ings, or who has made fraudulent re- turn upon any of the subjects covered by the law. will be subjected to a pen atty
 The amount of this penalty is the only feature of the bill which was not decided tonight. Most of the partici- pants in the conference expressed the opinion that this penalty sh ould range from 5000 to SIG, ,000. the amount to be fixed by a United States court upon presentation of all the facts connected .,., +3pch fraudulent terms.
 weakenedS will be collected upon the and lame bsunt of preferred and com unnatural drof every corporation and that has ,n curii5s of corporation where without any a> 'o'ai aliounl oi capi- 4cine--that l thi;
 ~trility, quickly an tha hiu shall he have. copy. So l tatalv ;nstaad or to send copy or tf,.'s sr sxad s'snu ,in,,te .. seeied envelope to anyuggested origi- write me for it. ITS tax will be
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 thin, s,!m I owe 7 copI it in such form that to send them nn anyyls nvpls of the internal thet isconrseed any wEht use information may may stop drugging@ay so as to in1use :r, believe is the assed tonight and it storative. upsuh only especially desig- ING CT, remedy oonnf the bureau should be h,lnsed nmst drop me aterrogate corporations E. Robinson, 4Si business. The corpor- Mich, and I weir returns directly to |. this splendid r internal revenue in N Hi-,ary sealed CT
 N at the conference that all