Daily press. [volume] (Newport News, Va.) 1896-current, 1909-06-22
PRECEDENT IS VERY OPTIMISTIC
Many OF the Senators Think, How
ever, That Proposition VIII Keep
Them In Session Until Long past
August 1-Eikins Says Corpora
lions VIII Adopt EvasIve Tactics.
(By Associated Press.)

WASHINGTON, H. T., June I'll
President Taft will personally super
wise putting the finishing touches upoa
the proposed amendment to the tarin
j bin paragraph for the imposition OF
per cent tax upon the net earn
ngs OF corporations This will be
done tomorrow night at conference at
the White House.
There will be present Attorney
General Wilkersham and Senator
Root. who art drafting the amend
ment Secretary OF state Knox and
the Republican membership OF the
Senate finance committee. II Is ex-
pected the perfected amendment will
be ready for Introduction in the Sen
ate on Thursday The attorney gem
/ eral and Mr. Root had a long session
at the capitol today and peached an
agreement on practically every feat
ure of the corporation tax plan. The
portion which Is giving them the
greatest trouble relates to the govern
ment control OF corporations neces-
sary to carry the law into successful
| operation. There has been no little
/ opposition to subjecting the corpora
| tons to the amount of publicity that
! will be required for the enforcement
of the law and to prevent manipuia-
| ton of stocks and bonds for the pur-
| pose of evasion
Publicity Must Be Given.
Members of the finance committee
| as well as Mr. Root and Mr.. Wicker
! sham agree with President Taft that
such publicity must be given and that
withoGt the corporation tax law will
be a failure. This feature 1T was
said. today. certainly win be incor-
porated in the amendment.
/ Among the details of the bill deter
| mined are that the tax to be levied
will be at the rate OF per cent and
| that ii will be collected from all cor
porations. All banks will come with
! in the range of the tax. but deductions
will be allowed National Banks to
| the amount of taxes paid upon their
4 circulation.
An important provision TO be In
cluded in the bill is a definition OF
| net earnings This will follow as near
| ly as possible the definition OF net
earnings contained in the Interstate
! commerce asst relating to railroad
corporations.
| President Optimistic.
President Taft is decidedly optimis-
! tic ever the outlook for the corpora
| ton tax, but a number OF the sens
tors who called at the White House
declared that the proposition wourd
keep the Senate in session until long
past August 1.
| Senator Elkins was one of the Presi-
: dents callers and he declared that he
and number of other senators would
have some remarks TO make in the
! Senate when the new scheme OF tax
.
The West Virginia senator believes
/ that all corporations would attempt
| in some manner &c avoid payment OF
the tax. Additional salaries and all
manner of expenditures would be re-
serted to. he thinks.
President Taft, on the otHer nand.
/ does not believe that per cent. tax
/ on net earnings is heavy enough 10
make any OF the larger corporations
. resort to evasive measures As to
/ bends. IL is possible. the President
/ feels. 10 provide q limit for the is
> suance OF such securities. based upon
the capital stock. that win prevent
CORPORATIONS from transferring all OF
! their securities into bonfis. the interest
on which always IS paid from gross
Z earnings
There seems 70 be no way in when
I the bondhclders can De reached un-
der the new tax. except by double
I taxation on the corporation. itseI,.
which is not contemplated Some pro-
visions may be made as tae -sssr-
ance Of bonds in the future to provide
that the interest shall Be paid ouly
: frcm net earnings
There seems nov to be little doubt
that the corporation tax as passed VIA
7 exempt ne; earnings 81 5000 and less
/ 80 as to take any undue burdens on
the smaller corporations. This Is the
7 understanding az the white House
Z and apparently Is the plan OF the
j r..Ir~n