The Washington times., 1912-03-19
TAX BILL
WILL PASS HOUSE
THIS AF TERNOO.. |.
Measure Designed to Meet
$4,000, 900 Loss If Sugar
Goes on Free List.

The excise tax BILL extending the
corporation tax to firms, copartnersh'ps
and individuals who are engaged in
business" and who have an annual
net income of more than $500, VIII
pass the House before adjournment to-
day.
The Democratic measure, which Is de-
vised 20 make up the $53,0OO,OO 900 loss in
revenue IL sugar goes on the free list
was called up in the House for debate
under the five-minute rule this alter
noon. General debate on the measure
engeged the House Saturday and yes
terday.
Although the Republicans, who be-
lieve that the excise tax bill is un-
constitutional, will make efforts TO
amend the measure before it is put on
its final passage, there is no proba-
bility that any change will be made In
the bill
Caucus Committed to Bill.
The Democratic caucus is committed
to the measure as it came from the
Ways and Means Committee and the
ma jority is confident that 1t Will stanu
the test of constitutionahty.
Facing a decrease of 1000 IN rev.
enue through the free sugar bill, the
Democrats of the House hit upon the
extended excise tax law both as rev
enue producer and measure WHICH
will euualiZe taxation.
The object and effect of the bill Is eX-
planned in the following report pre-
pared by Representative Underwood
chairman of the Ways and Means Com
mittee: go
This bill, If enacted into law. viii
accomplish in the main all the purposes
of a general incOme-taX law and at the
same time escape the disapproVal OF tho
Supreme Court, as IT keeps we'll wlthln
the principles laid down by that court
In sustaining the Constitutionality of the
corporation-taX law. AS defined by the
Supreme Court in the corporation-tax
case, the term business embraces
everything about which a person can
be employed and all activities, which
occupy the time. attention, and iapor
of persons for the purpose of a hvell-
hood or profit. This definition is en-
ployed, and is sufficiently Comprehen-
sive to allow but comparatively few to
escape where the earnings are In ex-
cess of 5000 per year, o,,ttoh,o adirst.
ment of the excise tax RECOMMENDED,
person having an income Of less than
5000 per year would pay nothing, While
net would pay no tax on the first 5000
and on the second 5000 would pay only
$50 year.
Leaves No Doubt.
The bill imposes the tax in words
which leave no doubt either as to the
subject or the nature of the proposed
| tax. 1t says
THAT every person, firm, or Copart-
nership shall be subject to pay
annually a special excise tax with re-
speCt to the carrying on or doing bust
ness by such person equivalent to / pei
centum upon the entire net income
over and above 5000 received by such
person from all sources during the
year. etc. The subject of the tax is
therefore, plainly expressed as the
carrying on or doing business by the
persons or copartnerships.
| Neither the property of the indi
viduals or firms. either real. personal
or mixed. nor the income thereof, Is
the subject OF the tax. So far as property
itself is involved, it is only its use ir
business which has any relation to the
subject of the tax, and so far as the
income on property, whether real, per
sonal, or mixed, is involved, it is only
used as fixing the measure by whicf
| the tax upon the doing of business shal
he assessed The bill is equally cleal
in fixing the nature of the tax as q
| special excise tax"