Evening star. [volume] (Washington, D.C.) 1854-1972, 1912-03-03
Expected to Begin in the
House by Thursday.
EARLY PASSAGE LIKELY
Sugar Bill to Be Taken Up at the
Same Time.
GUESS ON FATE IN SENATE
Two Measures Will Be Referred to
Different Committees in That
Body.

l
| The House is expected to begin dis
| cussion of the democratic bill to levy an
| excise tax on all net incomes above $4,000
year, including salaries, by Wednesday
| or Thursday next. 1t will be reported
| from the ways and means committee to-
gether with the bill to put sugar on the
| free list. The two measures probably will
| be considered CONFORMITY and both will he
passed within week or ten days.
The known success of the two measures
| in the democratic House, turned all dis
cussion yesterday to the Senate end of the
Capitol. where it was admitted that both
bills would have a tempestaous career. In
the Senate the bills will be referred to
different committees and. with many SEN
ators unfriendly to them, there is little
likelihood that they can be linked togeth-
| er, as is proposed In the House.
The so-called income tax, or extended
corporation tax bill. under the Senate
rules viii go to the committee on judici-
airy. where. it is said, it will meet with
| an unfriendly reception The free sugar
| bill will go to the finance committee
Senate leaders declared last might that the
finance committee hardly would feel juSti-
| fled in reporting a. bill cutting off more
| than $5O0O.OO0 in revenue without know
ing what the Senate proposed doing with
| the income tax bill. looked to to make
| up the deficit.
! On the other hand. it was said the mem
| bers of the judiciary committee would
not be easily convinced of the necessity
of the new taxing measure in the abb
sence of the passage of the sugar bill and
the consequent deficit in the revenues.
C%o%eroe-% - NJ H..1I
The extended corporation tax bill was
drafted by Representative Hull, of Ten
nessee. who has issued statement re-
lating to holding companies. as follows.
"The present corporation tax law ex-
empts all holding corporations from the
tax it imposes. The proposed excise tax
bill does not in terms impose tax upon
any corporation as such, but it does inn
pose a tax upon the business of all ind-
viduals. for instance, whose net earnings
exceed $780, including all net earnings
received or entitled to be received as
dividends, or other compensations within
the meaning of the act, out Of the net
earnings of any or all corporations that
do not themselves pay an excise TAX.
Hence every person connected with
a holding corporation as a stockhoider
or otherwise and who received, or is en-
titled to receive any portion of the an
nual net earnings of such corporations
in excess of $1,000 is liable for the tax,
and both such persons and such corpora
tons are compelled under suitabl pen
alties to discover and disclose In every
instance the exact amount OF annual mel
earnings upon which each Of such per-
sons taxes is entitled to be computed.
Under the system of collections at
the source carried in this proposed bill
each holding corporation would be re-
uuired under suitable penalties to make
nj
and the amounts of its annual net
earnings, to which each and every per-
son may be entitled whether actually
distributed as dividends or not, and
pay the tax computed thereon for such
person or spersons: ) u :
"Of course the proposed bill would
apply to. all holders of the bonds Of
such companies and those receiving in
terest thereon in excess of $1,000
TO Emphasize Feature.
Representative Underwood, chairman
| of the ways and means committee,
said yesterday that in reporting the
bill to the House next week this fea-
ture which hits at holding companies
| would be emphasized.
Speaker Champ Clark has been on
record in favor of an income tax since
his first term in Congress. In speaking
yesterday of the action of the demo-
cratic caucus. the Speaker said:
II have advocated an income tax ever
since I have been old enough to know
anything about public affairs and eco
nomic questions. A graduated income
| tax, with reasonable exemption, is
| the fairest and justest tax that was
ever levied. / began referring to it in
my first term in Congress, and have
been at it ever since and expect to
keep at it until it is put upon the
statute books"
Senator Penrose's Position.
Senator Penrose of Pennsylvania, who,
as republican leader of the Senate and
| chairman of the finance committee, will
| lead the fight against the House corpora
| ton tax measure, outlined his position as
| follows:
IT was not at all Enthusiastic for the
| corporation tax provision in the Payne
| tariff bill. We should not take up any
| sources of revenue that belong to the
states. The states must get revenue
from somewhere, and 1t is not right for
| the national government to go into their
| sources of supply when the government
has ample opportunities in other direc-
| tons The federal government ought to
| be run on indirect taxes and customs du-
| ties, with the exception Of the long es-
tablished internal revenue taxes
THE time will come when the Ameri-
| can people will wake up to this and re-
fuse to permit the federal government to
interfere with subjects OF taxation which
properly belong to the states.
Senator Cullom of Illinois, also men,
Der Of the finance COMMITTEES, and head
| Of the foreign relations committee. said
i he favored an income tax In principle
| but did not know that the time was ripe
| for it, He doubted il the free sugar plan
| would get serious consideration in the
| senate until the tariff board reported or
| the subject.
May End Reciprocity Treaty.
! According to officials of the bureau o.
ttrade relations Of the Department OF
State, one effect of the enactment into
law of the democratic caucus program Of
placing sugar on the free list would b<
10 terminate the present reciprocity treat,
with Cuba and affect $4O.0OO,O0O of Amer
Jean imports into that island, on which
Cuba grants a reduction of from 20 tt
| 40 per cent in duty.
The reciprocity treaty provides tina
| in case of changes in the tariff of either
| country which deprive the other OF thu
/ advantage which is represented by thu
/ percentages. agreed upon the country 81
deprived Of this protection may terminate
| the treaty after six months notice.
j The abrogation of the treaty by Cuba
| would materially affect the coffee in
| dustry Of Porto Rico, which is largely
i dependent upon the Cuban market, where
/ it now receives the benefit of % pei
i cent reduction. Cuba takes more thar
/ half of the Porto Rican coffee crop.
WELL DIGGER'S BODY FOUND.