The Arvada enterprise., 1913-04-10

Incomes of taxable persons shall
| include gains, profits and income de-
rived from salaries. wages or com
! pensation for personal service Of
whatever kind and in whatever form
| paid, or from professions, vocations,
business trade, commerce or sales or
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 bequest, devise or de-
scent, and also proceeds OF life insur-
ance policies paid upon death of per
| sons insured.
Provision Made for Deductions.
The bill allows as deductions in
| computing net income all necessary
| expenses actually incurred in carrying
on any business, not including per
sonal living or family expenses, inter
est accrued and payable within the
year by taxable person on indebted
ness; all national, state, county,
school and municipal taxes, not in
cluding local benefit taxes: losses in
CURED in trade or from fires, storms
or shipwreck not compensated by in
surance or otherwise: debts actually
| ascertained as worthless and charged
| off; 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 excepts 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 its net income under the cor
poration tax provision of the bill.
The bill excludes the compensation
of 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 a state or
any political subdivision thereof.
System of Collection Framed.
It establishes a system of collection
of the tax at its source, requiring all
persons, firms, copartnerships, com
panies. corporations, joint stock com
panies, associations or insurance com
panies, and all trustees, executors, ad-
ministrators, receivers. etc, and Off
GERS and employees OF the United
States having the control or disposal
of salaries, wages, interest and other
profits and income of another person
to withhold and pay to the collector
of internal revenue the amount 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
make return on incomes who fail to
do so at a specified time, are made
liable to a fine not exceeding $500 and
the penalty for false or fraudulent re-
turns is fixed at $1,000 or imprison-
ment not exceeding one year, or both
In formulating this additional i'm
post" said Chairman Underwood in
his report, the attempt has been
made to provile not only a source of
revenue, but also a means of redress
ing in some measure the unequal tax
burdens which result from the prac-
tirely upon customs and internal reve-
nue. duties This is a system of tax
alton which inevitably throws the bur
den of supporting the government up
on the shoulders Of the consumers.
1t Correspondingly eXempts the men
of larger income, whose consumption
of the ordinary neCessaries of life is
gt,I ariT in fp
aggregate degree than Is that of small
er income earners, who eXpend the
greater proportion of their resources
for the ordinary necessaries OF life"
Underwood Defends Plan.
Speaking of the principle of taxa
ton laid down and the graduated sys-
TEN proposed. MIR. Underwood de-
Clared
The progressive principle already
has been sustained by the Supreme
court of the United States in the in
hcritanCe tax cases and there can be
no doubt that the same principle ap-
plies to the income tax included in
this bill and will be fully upheld
should it ever be called into question.
Owing to defects in personal property
taxation the larger incomes in the
United States have for many years
been able to escape with less than
their share OF the general burden of
taxation, and this inequity will be, it
is believed, in part overcome by the
plan proposed"
The bill provides that all taxable
persons shall be notified of the amount
for which they are liable under the
law on or before the lst day OF June
OF each year and assessments must be
paid on or before June 80. For delay
in making payments and ten days aft
er notice. there shall be added the
sum of 8 per cent Of the amount OF
tax unpaid and interest at the rate OF
/ per cent month from the time the
tax fell due.
The corporation tax provision, 1t is
directed. shall be computed upon in.
come for tho year ending December
81, 1918, and for each calendar year
thereafter. It is provided, however.
that corporations may designate the