Norwich bulletin., 1909-09-22
Taft Took Up
 Corporation Tax
AS AGAINST THE DIRECT INCOME
 TAX.
HIS ADDRESS AT DENVER
To an Audience of Thousands In the Auditorium-The Presidents Arau-
 ment-Enthusiastio Welcome. ~

Denver, Col, Sept 21.--President Taft arrived in Denver this afternoon and tonight in the Denver auditorium faced a.crowd of thousands that in it's noisy welcome and continuing enthus- iasm recalled some of the scenes of convention work last year. President Taft elected tonight to. take up the corporation tax passed as. a part of the Payne tariff bill and to defend 1t as against the proposition to impose a state income tax which he acknowl- edged seemed likely to pass the sem ate when the corporation tax was de- Nised as a compromise. He strongly urged that all the states should adopt the proposed amendment to the con st;tution to make an income tax pos sible in time of need. s-
 The Best Form of Income Tax.
 The president tonight declared that the corporation tax was in itself the best form of income tax that could he levied and pointed out that 1t contain- ed many of the best features of the income tax law of England. In urg- ing that the states should vote for the amendment to the constitution permit ting the levy of direct income tax without apportioning the proceeds among the state. according to their population. the president declared that 1t would be possible so to amend the corporation tax as to include first in its scope every desired feature of an income tax except the levy upon in- comes derived from actual salary and professional services.
 The president said he opposed a d. rect Income tax except in cases of emergency, and he believed it to be a prime fault in the federal constitu- ton that no provision is made for a direct levy to meet wartime or other extraordinary expenses
 Mir Taft declared that 1t was the supreme court decision declaring un- constitutional the income tax passed by democratic congress some years ago that prevented the leaders in con- gress during the session recently closed from including in the corpora ton tax measure provision for a levy upon bonds and bondholders To tax bonds would result in the reuiuc- tion of the rate of interest and hence this resulted in direct tax upon the individual holders of the bonds and came in contact with the decision of the, court that no direct tax could be levied by the national government without the resulting apportionment of the proceeds among the states.
 Results of Income Tax in England.
 The president based his argument In favor of the corporation tax as compared to the direct income tax. al- most entirely upon the results of the income tax in England.
 He pointed out that the tax there Is not direct levy. such as was recently defeated in the senate only through a compromise, but that it laid the tax upon the income before it came into the hands of the individual. The Eng fish tax is levied first on the declared dividends of corporations. secondly on rents before leaving the hands of the tenants. and thirdly on the individual directly It was found in England that a direct income tax at 10 per cent. did not produce as much revenue as the present method of taxation at five per cent. This he declared illustrated the premium that the direct tax places upon perjury and concealment.
 It is a question. the president de- clared, whether salaries and incomes from professional work should be tax ed as heavily as incomes derived from investments, or not taxed at all. The latter he said. was the effect of the corporation tax.