Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1912-03-14
EXCISE TAX Bill
REPORTED 70 B|)|)q
OFFERED AS REVENUE MGAoUN0
&c REPLACE cusroMo "a
DUTIES ON SUGAR.
coNsr,TurioNALlTv or NEW
mEAsURE 10 GUARANTEES
Supreme Court Oseisiens Quoted ~
Democratic Leaders e Prsve oiii
Constitutional - Would sANt Tax
Burden, 10 Claim. 20 Shoulders Mors
Able 70 Bear Weight Of TaxaAieN.

Able 70 Bear Weight ef TaxasieN.
Washington. March 1l.-0laintaanihg
the constitutionality OF tho proposed
excise tax bill, extending provision OF
the corporation tax law to individuals
and partnerships. submitted -
revenue measure to replace custOms
duties on sugar, Representative Un4er-
wood. chairman Of tho ways and MEANS
committee, made a report to the house
today. urging the passage Of tho bill.
After arguing tho constitutiouAltty
Of the proposed law. proclaiming tt IN
absolute conformity with supreme
court decisions relating to the incosns
tax. the report explains tho pruvisaous
and ecope OF the measure. - Il would
affect individuals.
while the bill." says tho roports
"embodies a new application OF taxes.
It carries Gil tho modern philosophy OF
taxation. It proposes to obltSe tho
citizen to contribute annually . fair
and Just portion OF his net gains to the
maintenance OF tho government. 40
already stated. this blu. II enacted Int
law. Will accomplish in the main Oil
the purposes OF general income-ta0
law and at the salne time escape the
disapproval OF the supreme court. faA
It keeps well within the principles lAid
down by that court In sustaining the
constitutionality Of tho corporation tax
law.
ITO illustrate the equitable adjust.
ment OF the excise tax recommended .
person ha..nR an income 81 Ices tnan
$1,000 Ter year would pay nothing.
whilc pez son whose business earns
$4,000 ret would pay no tax on tne
nrst $1,000 and on tho second @6.oO0
would pay only $50 year"
Shifting Of Tax Burden.
Continuing. the report assotts thA3 I.
the burden OF "our present indiEect
taxation" falls upon people having -in-
comes OF less than $4,000.
"A large percentage OF the cuseoutos
taxes" II says. Amounting to 93oo. .3o6.-
66c In 1911. was paid by people whose
incomes aid not exceed $1,000 par year.
The bill aims to distribute more Just.
ly the tax burden by shifting an cquit-
able portion OF the taxes to ths shcul.
ders OF those OF larger earnntss. There
are no statistics as to the number OF
individuals. firms and copartnerships
In the United states that would ke
subject to the taxes proposed by this
bill
The report cells the proposed hin
combination OF the excise tax OF 1898
and tho corporation tax law Of 1908.
both OF which have been held valid In
all respects by the supreme court"
Taxation Subject to Earnings.
when citizen pays taxes accord.
ing to his earnings. from whatever
source. he gives support to his Gov
ernment. and receives protection from
II I'm n more equitable manner than Un-
der any other plan OF taXatoin yet de-
vised. If his earnings Increase His
taxes increase, ard Justly so. for he IL
better able to pay increased taxes II
his gains decrease. 50 do his taxes, ana
fortunately for him. because he Is less
able 10 pay them. There is also this
striking advantage OF n tax or earn
ings over taxes on bought and sold
namely, the rate can hs
raised or lowered to meet the ey-
igencies or revenue requirements with
out consequent disturbance OF prices.
The report calls attention to the in
come tax law OF 1894 and argues that
It would have been sustained II drawn
In the form OF law now proposed. and
in support OF this contention. quotes
Chief Justice Fuller, who said In the
opinion on the income tax cases: I'VE
have considered the net only in respect
of the tax on income derived from real
estate and from invested personal prop
erty, and have not commented on so
much of It as bears on gains or profits
from business privileges or employ.
rents In view of the instances In
which taxation on business. privileges.
or employments has assumed the gutse
OF an excise tax and been sustained
as SUCH
That the proposed tax is constitu-
tional the ways and means committees
democrats believe. for the following
reasons. which they argue can be sus.
tained:
The proposed tax is not direct tax
upon the property. real or personal, ce
the copartnerships or individuals, but
a special excise upon the carrying on
or doing business by such copartner-
ships or individuals. and II. therefore.
needs no apportionment among the
states according to population as re.
auired by the constitution with refer.
ence to dir .ct taxes.
''The proposed tax Is uniform thru-
tut the United States. II II be true
that the tax is an excise its indirect
character IL mt once established.
"The proposed tax Ia an excise be.
cause.
'The tax Is legislatively intended a.
an excise, as shown by the plain lAn-
guage Of the bill.
.The subject OF the tax is the scNe
duct or transaction Of business which.
according to a uniform line Of decisione
hy the supreme court OF the Unite0
States ~ . proper subject OF excsso
tax.
sThe fact that the tax ID % b menee
,,red BY the net income OF the taxahle
y. ..o,, nr Arm dos mot CHANGE ifn lool
character"