Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1913-04-08

Democratic tariff revision bill intro
duced Iii Congress today is ar income
tax section which would require every
resident OF the United States who earns
more than $4,000 a year to pay tax OF
one per cent on his earnings III excess
of the exemption.
This would not require the man who
earns only $4,000 to pay tax, but it
would demand that the individual who
earned $4,10o, for example, pay into the
government treasury an annual tax OF
one per cent on $780, or 81.
The bill also would provide higher
rates of taxation for persons with larg-
er incomes, adding surtax of one per
cent additional on earnings in.excess OF
$4,000: two per cent additional on
earnings in excess of 500, 000
Under the surtaX provisions the man
who earns only $40, 900 would pay to the
government each year at sthe rate of
one per cent on $4,000 $4,000 exempt).
or SLIGO. If he earns $50, 00e he would pay
one per cent on $4,000. still and two
per cent on $4,000, thus making his an
nual tax $500. The person with $50, 900
income would pay one per cent on s16.-
GOO and two per cent on $50 000--a total
tax Ct $3.50. The man with an income of
100000. would be required to pay one
per cent on $1,000 two per cent on $40, :
600. and three per cent on $4,000 which
would be $500, bringing his total in
come tax at 1920. The individual with
net income OF Il million would pay
this S2,260 on his first 100000 and in
addition he would pay four per cent on
100000. which would bring his total
tax to $3S, 26o.
The bill also would re-enact the pres
ent corporation tax law imposing II
one-per cent tax on the earnings of
corporations, stock companies. insur-
anee companies and the like, but L
would exempt partnerships. This is
d fiat tax, there being no graduated
scale as the earnings increase. The few
changes from the present corporation
tax act concern chiefly the time of
making returns and the time for collec
ton. The bill also includes under its
provisions the property and earnings in
this country of persons who live
abroad.
II Is estimated by members of the
WAYS and Means Committee that ap-
proximately 10000, 900 in revenue may
pe derived from this new tax. includ-
ing the corporation tax, that amount
making up for the deficit in revenues
to be derived from importa by virtue
Of the greatly reduced tariff rates and
TIE transfer to the free list of articles
that are classed as necessaries of liv-
ing.
Incomes of taxable persons shall in
Guide gains, profits and income derived
from salaries. wages, or compensation
for personal service of whatever kind
and in whatever form paid. or from
professions vocations, business. trade,
commerce, or sales or dealings in pro-
pertv. also from interest, rent, divi-
dends, securities. including income
from but not the value of property ac-
uuired by bequest, devise or descent,
and also proceeds of life insurance poll
ieies paid upon death of persons insur-
cd.
The bill allows as deductions in COM
putting net incomes all necessary ex-
penses actually incurred in carrying on
any business. not including personal,
living or family expenses, interest ac-
crued and payable within the year by
a 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 ship wreck
not compensated by insurance or other
wise: debts actually ascertained as
worthless and charged off; 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.
1t excerpts also, in computing net in
come, amounts received as dividends
upon the stock of any corporation,