Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1913-04-08
Democratic Tariff Revision
Contemplates a Tax of
From / to,4 Per Cent on
Americans Earnings.
OWNER OF A MILLION
MUST PAY $38,260.
Expect Measure to Yield
$780, 100000 in Revenue /;
Exemptions Varied; Col
lections Made at Source.

Washington, April 7.-Included in
the democratic tariff revision bill in
troduced in congress today Is an in
come tax section which would require
every resident of the United States
who earns more than $4,000 year to
pay tax Of per cent on his earn
inEs In excess Of tho exemption.
This would not require the man
who earns only $4,000 to pay a tax
but 1t would demand that the indi-
vidual who earned 34,100, for example,
pay into the government treasury an
annual tax Of i per cent on 500, or 81.
Tho bill also would provide higher
rates OF taxation for persons with
larger incomes, adding surtax of 1
per cent additional on earnings in
excess of $4,000: 2 per cent addition
al on earnings in excess Of $4,000,
and per cent additional on earnings
In excess Of 100000.
Cost Millionaire $aa,26o.
Under the surtax provisions the man
who earns only 100000 would pay to
the government each year at the rate
OF i per. cent on $4,000 $4,000 ,ex-
empt1 or $50! II he earns $4,000
he would pay per cent on $4,000,
still and 2 per cent on $4,000, thus
making his annual tax 1850. The per-
son with $4,000 income would pay
1 per cent on $4,000 and per cent
en- $4,000. a total tax Of $760. The
man with an income of 100000 would
be required to pay per cent on $16,-
900, 3 per cent on 100000, and 3 per
cent on $4,000. which would be
81 500, bringing his total income tax
to 3a,260. The individual with net
income OF q million would pay this
$2,260 on his FIRST 100000 and in addi-
ton he would pay 4 per cent on $780,
900, which would bring his total tax
to $3s.2eo.
The bill also includes under its
provisions the property and earnings
in this country of persons who live
abroad.
It is estimated by members of the
ways and means committee that ap-
proximately $1O0,00O,O00 in revenue
may be derived from this new tax. in
cluding the corporation tax that
amount making up for the deficit In
revenues to be derived from imports
by virtue of the greatly reduced tariff
rates and the transfer to the free list
of articles that are classed as nec-
essaries Of living. .
Incomes Of taxable persons shall in
clude gains, profits and income derived
from salaries, wages, or compensation
for personal services Of whatever kind
and in whatever form paid, or from
professions, vocations. businesses.
trade, commerce, or sales or dealings
in property, also from interest, rent,
dividends, securities. including income
from property. income from but not
the value Of property acquired by be-,
quest, devise or descent. and also pro-.
ceeds Of life insurance policies paid
upon death of persons insured.
Tho Exceptions Allowed.
The bill allows as deductions in COM
putting net income all necessary ex-1
penses actually incurred in carrying on
any business, not including personal,
living or family expenses, interest ac-
crued and payable within the year by
q taxable person on indebtedness: all
national, state, county. school and
municipal taxes, not including local
benefit taxes; losses incurred in trade
or from fires, storms or shipwreck not
by insurance or other
wise: debts actually ascertained as
worthless and charged OF; also reason
able allowance for wear and tear on
property, but no deduction will be al
lowed for expense Of restoration or i'm.
provements made to increase property
value
It excepts also, in computing net in
crease. amounts received as dividends
upon the stock Of any corporation, joint
stock company. association or insur-
ance company which is taxable upon its
net income under the corporation tax
provision Of the bill.
The bill excludes the compensation
of the president of the United States
during his term, judges Of the supreme
and inferior courts OF the United States
and compensation OF all officers and
employees Of state or any political
subdivision thereof.
Collects at Source.
1t establishes system Of collection
of the tax at it's source requiring all
persons. firms, copartnerships, com !
panies corporations, joint stock COM
par,ies, associations or insurance COM
panies, and all trustees, executors, adj
receivers etc, and Of
ficers and employees OF the United
states having the control or disposal OF
salaries, wages, interest and other prof
its and income OF other persons to
withhold and pay to the collector OF in
ternal revenue the amount, OF income
tax due from such person.
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