The herald-advance. (Milbank, S.D.) 1890-1922, 1913-04-18

oi'lSies mat are claSSed as neceSRa
ries Of living.
incomes OF taxable persons shall
lnclude gains, profits and income de
rlVeo from salaries. wages or com
persation for persona! service O.
Whatever kind and In whatever form
PAID, or from professions, vocations
business, trade, or sales O,
dealings in property, also from Inter
est, rent, dividends, securities, includ
Ing income from property, income
from but not the value Of property
acquired by b~equest, devise or de
scent, and also proceeds OF life insur
ance policies paid upon death OF per,
0 n insured.
Provision Made for Deductions
The bill allows as deductions In
computing net income all necessary
expenses actually incurred In carving
on any business, not including per
n living or family expenses, inter
est accrued and payable within the
year by a taxable person on indebted
ness; all national. state. county,
school and municipal taxes, not IN
cludlng local benefit taxes: losses in
CURED In trade or from fires. storms
or shlpWreck not compensated by In
surance or otherwise: debts actually
ascertained as worthless and charged
on; also reasonable allowance for
wear and tear on property: but no de-
duction will be allowed for expense
OF restoration or improvements made
TO increase property value.
1t excerpts also, in computing net in
come, amounts received as dividends
upon the stock of any corporation,
JOINT stock company, association or
insurance company which Is taxable
upon It's net income under the cor
poration tax provision OF the bill.
The bill excludes the compensation
or the president OF the United States
during his term, that Of Judges OF the
Supreme and inferior courts OF the
United States, and compensation OF
all officers and employees of e. state or
any political subdivision thereof.
System of Collection Framed.
- ~phu a SSSISlu OI COIlcCClOn
OF the tax at its source, requiring all
persons, firms, copartnerships, com
pan1ea, corporations, joint stock com
panies, associations or insurance com
pan1es, and all trustees, executors, ad-
mln1strators, receivers, etc, and Off
GERS and employees Of the United
States having the control or disposal
or salaries. wages, interest and other
profits and income OF another person
TO withhold and pay to the collector
OF internal revenue the mou of IN
come tax due from such person. All
such persons or firms are made per
sonally liable for such tax.
Persons or corporations liable to
return on incomes who fail to
DO so at a specified time. are made
to a fine not exceeding $500 and
The penalty for false or fraudulent re-
turns is fixed at $1,000 or imprison-
nent not exceeding one year. or both.
In formulating this additional i'm
said Chairman Underwood liz
Ills report, the attempt has been
made to provide not only a source of
'eyenue, but also a means of redress
ng In some measure the unequal tax
BURDENS which result from the prac-
ice Of basing the federal income en-
irely upon customs and internal reye-
Tue duties. This is a system of tax
which inevitably throws the bur
OF supporting the government up
the shoulders Of the consumers.
t correspondingly exempts the men
I larger income. whose consumption
I the culinary necessaries OF life is
ubject to tariff taxation in a far less
ggregate degree than Is hat of small
r income e%arners, who expend the
proportion OF their resources
he ordinary necessaries of life"
Underwood Defends Plan.
Speaking Of the principle Of taxa
on laid down and the graduated sys-
proposed. Mr.. Underwood de-
The progressive principle already
been sustained by the Supreme
'urt Of the United States in the IN :
tax cases and there can be {
, do0bI ludL lUB same principle ED- !
les to the income tax included in
is bill and will be fully upheld |
1t ever be called into question. s
wing to defects in personal property a
xation, the larger incomes in the !
nited States have for many years d
zen able to escape with less than Y
cir share OF the general burden OF il
xation. and this ~inequ!ty will be, it d
believed, in part overcome by the d
an proposed" l.
The bill provides that all taxable .
rsons shall be notified OF the amount G
r which they are liable under the b
" on or before the 1st day of June
each year and assessments must be
i'd on or before JIne 80. For delay
making payments and ten days aft >,
notice, there shall be added tho ;,
m OF 5 per cent. of the amount OF .,
unpaid and interest at the rate of !
Der cent. a month from the time the =
fell due. :.
The corporation tax provision, It IL !.
acted shall ba n rIltaI npop 4, -