The Washington herald., 1909-07-13
IN Reeast Amendment.

with the outlook
VIII Reeast Amendment.
One OF the important things already
undertaken at the instance Of the Presi-
dent is a complete recastiug OF the long
and involved corporation tax amendment
With the consent Of Chairman Aldrich.
Of the Finance Committee. and Chairman
Payne. oF the Ways and Means Commit
tee, Mr. Tat has requested Attorney
General Wickersham 20 rewrite this
amendment in such a way as 10 make fl
more satisfactory 70 the administration
and many Of those who supported il in
the Senate.
As the amendment stands now its pro
visions are regarded as less specific tnan
they should be. particularly with respect
% the character OF corporate organiza-
tons entitled 20 exemption from the pay
ment Of the tax There has been doubt
as 90 whether certain corporations organ
tied for mutual benefit are released by
the amendment from the obligation OF
making returns 20 the Commissioner Of
Internal Revenue. and payment Of the
tax on their net income. and the under
standing IS that the amendment viii be
redrafted so as 20 relieve these corpora
tions from taxation
one Of the important changes 70 be
made IN the corporation tax viii be a re-
duction IN the rate OF taxation from 20
per cent. Il Is estimated that the per
cent tax VIII bring a revenue Of about
S50o00000. which IS fully double the
amount Jhat experts have estimated will
be required 10 meet any possible de-
fciency in the revenue during the first
year or two OF the operation OF the new
tariff law. Additional reason for re6uc-
ton Is that the increase in the taxes on
smoking tobacco and cigarettes adopted
by the Senate just before the tariff bill
was passed VIII produce about S9.0o0.000
To Exempt Holding Companies.
President Taft lei II be known 10 per-
sons who talEed with him yesterday that
his chief interest in the corporation tax
amendment lies IN the authority which II
confers on the Federal government 70
supervise the business methods OF cor
Indifferent as TO whether the corporation
tax rate Is permitted 70 remain at 2 per
cent or is reduced to l per cent.
He Is outspOken, however. IN HIS oppo-
sitior to the amendment 10 the corpora
ton tax amendment. which provides for
taxing the incomes Of holding companies.
This addition 20 the corporation tax p C.
vision was proposed by Senator Clapp, or
Minnesota, one Of the Republican in-
surgents. and was accepted by the FL
nance Committee In order 70 prevent pro-
longed debate at a time when the con
sideration OF the tariff bin in the Senate
was practically completed.
The Presidents opposition 10 the Clapp
amendment does not arise so much. il at
all, from the idea that Il IS in the natuIs
Of a double tax on corporation incomes.
and its inclusion IN the corporation tax
amendment Is likely 10 jeopardize the
legality OF the corporation tax features,
as from the belief that the taxing OF hold
ing companies through this means is IN
necessary and unwise. His view is that
such companies can be brought within
Federal control by other legislation
Last Nights Discussion.
At q meeting last night OF the conferees
on the tariff bill the metal schedule was |
gone over and the wood schedule was /
taken up and considered for time. Many I
contested paragraphs were passed over I
for the time. There was much general !
discussion.
The impression seems TO be growing /
that the administration features. fnclud- /
ing the customs court provision and the I
maximum tarif, win remain in about the I
form in which the Senate passed them. /
The Senate probably viii be compelled 4
10 yield something in the dutiable lists. !
II Is regarded as likely that in the end I
e duty OF 10 or y cents ton may be put 4
on iron ore instead OF . cents. as the 4
Senate left Il, or free as the House 4
passed II.
On hides the Senate win probably yield +
something. A duty OF 10 per cent seems 4
TO be the favorite guess with the House
rate OF 81 per l.vJ0 feet on lumber The F.
countervailing duty on oil viii probably /
remain. and cotton bagginG. which was
put on the free nst in the Senate. VIII /