Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1910-01-01
INTEREST SHOWN
BY CORPORATIONS
Recently Imposed Excise Tax
Draws Much Comment
In Utah.
IMPOSSIBLE OF APPLICATION.
Accountants So Declare Law as Passed
BY Congrcss-Statcments Due Un-
der Big Penalty March 4.

Business firms. banks, insurance and
| mining companies. In fact, all forms
of commercial activity in the form OF
| corporations, are greatly Interested In
! the blank forms which have been re-
ceived this week from the Office of the
collector of internal revenue for the
State of Utah on them. some time
during the next 60 days will be placed
which is to determine the amount Of
| corporation tax which they are to pay
| to the government. This information.
when it is sent to the office of the
| collector of internal revenue for the
state. Will then be transmitted 10
Washington 1t will there be passed
upon and recorded by the commission
or of internal revenue. who Will file
all the reports so that they may there
after be accessible to the public. Peo-
pie will then know what Salt Lakes
big stores and banks are earning
or they may find out what -he
United States Mining company. or tns
American Smelling & Refining CON-
pany has been doing during the year
1909 The private life. as 1t were, OF
more than 100000 corporations in the
United States will thus be placed on
exhibition at Washington, for the edi-
ncation OF the people of the United
States, and for that matter, of the
world And the strange thing about
1t is that while the inner life OF the
corporations Is made public, partner
ship concerns may pursue the even
tenor of their way undisturbed by
this new edict of the government which
has raised such hue and cry in the
financial world.
PENALTY FOR DELINQUENTS
Although the work of mailing the
blank forms to more than 5000 cor
porations in the State of Utah was
completed on Wednesday by the office
staff of the internal revenue collector,
it is possible that some may have been
missed The names OF the firms were
taken from the secretary of states Of
flee, but should any firm be missed
they would not be excused II they failed
TO report on the date set which is
March l at the latest, and the fine of
1000 for failure to comply with the
law would be the penalty against them
just the same as If they had received
due notice. Ignorance of the law is
no excuse, and if there are any cor
porations in the state who have failed
TO get the blanks referred to above.
they had better notify the collector of
internal revenue at once.
This law. which is designated an ex-
else tax on corporations. stock COM
panies, associations and insurance COM
panies, was passed by Congress Aug.
of the present year. A 16-page
pamphlet of regulations was issued
from thn pnlpuoiaeionor,o of1co Wash
ington, under date of Dec. 3. 1909. In
this booklet are explained many of the
details of the law so that officers OF
the corporations, as we'll as the ac-
counting force. may know Just what is
required by the department.
In spite of the high authority which
has made the edict which is filing the
business men of the country with con-
sternation and in some cases with in
dignation many defects in the scheme
are pointed out. Its legality and con-
stitutionality are disputed and the ex-
pert accountants of the country boldly
state that the provisions of the law vio-
late all the accepted principles OF sound
accounting.
ACCOUNTANTS PROTEST.
Prior to the passage of the law 12
firms of public accountants of New
York city protested against the meas
ure to Attorney General George w
Wickersham, stating among other
things, the following. 1--WE have
formed the opinion that some of its
provisions are absolutely impossible of
application. and others violate all the
accepted principles of sound account
ing" They also say: "As account
ants actively engaged in the audit and
examination of a number of varied
businesses and enterprises, we un-
hesitatingly gay that the law as framed
is absolutely impossible of applica-
ton
The attorney general, in answering
the letter referred to. said, Your
further statement that as accountants
we unhesitatingly say that the
law as framed is absolutely impossible
OF application causes me very great
surprise. My personal acquaintance
with you and number of the other
siGners OF tho letter leads me to the
peiief that you have underestimated
your capacity Certainly the statement
of objections made In your letter Is en-
tirely insufficient to support the con-
clusions which you express"
PROTEST FROM UTAH.
Speaking of this phase of the law
yesterday ]. w. Edmunds of this city.
who is a certified public accountant of
Utah, said:
The commissioner of internal revenue
appears to have slightly modified tho
position taken by the attorney general
In note A on the form to be filed by
mercantile corporations, he states that
| the gross amount of income shall be
ascertaIned by taking the inventories
| at the beginning and the end of the
| calendar year. 1t Is noteworthy that
| the law itself contains not the slight
| est reference to any inventory, without
| which it is impossible for any mcr-
| camille corporation to accurately de-
termine what its profits have been
| Nor does the note referred to obviatc
the difficulty materially. 1t says:
! inventory. OF it's equivalent,
which shows the difference between the
price received for goods sold and the
cost OF goods purchased during the
year" submit that 1t is impos-
sible to ascertain this without taking
into consideration the goods sold on
credit. and which have not been paid
for at the end OF the calendar year.
The specific objection which the ac-
countants had against the law wal
that corporations arc required to make
statement showing their receipts and
disbursements for the calendar yoar:
the accountants contendlng. very prop
erly. that n statement OF receipts and
disbursements only does not. and car
not. disclose the true financial condI.
ton of any ordinary business corpora.