The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1912-03-02
FREE SUGAR CALLS
FOR INCOME TAX
Revenue Lost by One
Will Be Made Up
by Other.
MEANS SHIFTING
OF TAX BURDENS
Bills Presented by Underwood
and Ratified by Democratic
Caucus Aim to Reduce Cost
of Living, and Raise Neces-
sary Revenue From
Those Able to Pay.

Washington, March IA bill to put
sugar on the free list, eliminating
s53,o0o.ooo in annual customs revenue
and another to extend the present
corporation tax to include individuals
and copartnerships doing business OF
so.VeO year or over, were ratified to-
night by the Democratic caucus OF the |
House
The excise tax, so called by the
Ways and Means COMMITTEES. is in
effect an Income tax. The bill is so
drawn that 1T Is expected to comply
with the supreme Courts decision
against the constitutionality of an in
come tax. Its effect would be to tax
every person who earns moro than s5.-
600 year on the excess of $4,000 al
the rate Of l per cent.
The estimate OF Chairman Under
wood and members of the Ways and
, Means Committee is that the proposed
excise tax would bring in revenue of
between S50.ooo,0oo and $4,000, 900 a!
year.
Placing sugar on the free list, the
Democratic leaders estimate, will re-
ducc the price of sugar to the con-
sumner about a cent and a half {.
pound.
The secret that members of the
Ways and Means Committee had been
so closely guarding for several days
was the provision to extend the cor
poration tan In the caucus that bill
was not seriously opposed.
Ine free sugar bill, however, was
bitterly aseailcd by representatives
from Louisiana, the cane sugar State,
and representatives from sugar beet
growing State. WAC were absolved
from the bond OF the caucus No roll
call on the ratification of the bills was
demanded.
Majority Leader Underwood an
nounced that the bills would ne re-
ported TO the House in a few days.
simply Rewrote Inv.
I'VE simply took the corporation
tax law and rcwrote 1t to include in
dividuals and copartnershps." said Mr..
Underwood 10 night. The bill, to
illustrate. simply means that l. whose
business Is that of a member of Con-
gress. will pay to the government /
per cent. of my salary income over
$4,000. The salary OF a Congressman
is $500. / would therefore pay an
excise tax OF s25 a year"
Tho President OF the United States.
should the proposed bill become law,
would pay per cent. on $4,000. or
500, his salary being $4,000.
Chairman Underwood made a state
ment to the caucus that he had been
directed by the Ways and Means Com
mittee to submit n bill to place sugar
on the free list and another bill ex-
tending the present excise tax, now
levied by law on corporations. to indi-
riduals and copartn,rships having an
annual income of more than $4,000
year.
Lower Cost Of Living.
'The bill removing the taxes levied
| 1T the custom houses on sugar" said
Mr.. Underwood. imported into this
country will have the eff.c OF reduc-
Ing the price OF sugar to the consumer
about l y cents n pound The state
ment further says that in the opinion
of the Ways and Means Com ni:tee the
large profits made by manufacture ,,s
and reiiners Of sugar have been due 10
the customs tariff. and that placing
| sugar on the free list would reduce the
profit. would not destroy the Industry
In the United States. but would result
in saving to the American peoplc
of sl07 900 600
''The purpose of the excise bill pre-
scented TO the CAUCUS Mr.. Underwood
said, is TO extend the tax OH doing OF
business by individuals and copar,n.r
ships The special tax will accomplish
the same result as would have been
accomplished By an income tax. so
far as raising revenue is concerned,
but at the same tiiic the bill ke,ps
well within the principles laid down
by the supreme Court in Its decision
affirming the constitutlonality of The
corporation tax law.
The bill does not in any way altnr.
/; amend or repeal thu corporation tax
law as II now stands On the stature
books. but provides that every person.
firm or copartnership shall he subject
TO pay annually IA special excise tax
with respect TO carrying on or doiaa;
business by such persons cquiva1, nt to
per centum Of the entire net income
over and above $4,000 received BY such
person from all sourccs during each
year and further provides that in com
putting the income of any person there
shall not be included the amount re-.
eciVed from any corporations Joint
STOCK company or association or insur-
ance company. II ,ht special excise taX
Of per cnt,im now impos I'd by law.
has been paid by such corpora ton or
stock company or insurance cornpany
or associa ton.
No Double Taxation,
in other words. the incom, derived
from dividends of II corporation on
which the tax is now levied by law will
not be subject to n further or add.
tsonal tax. but incomes derived from
other sources of business than those
named in the corporation tax act vii,
be subject to 4 tax OF per cent. where
the net income exceeds $1,000 anna
ally
The statement further says
That II these hills become laws
they will have repealed q burden of
taxation now borne by the American
people on a food product that ali mus,
consume of sl07,oo0.00c and will have
substituted In place thereof taxes tina,
viii probably aggregate between s5O.-
100000 and 500. 900 900. that will be col