The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1913-04-07
Persons Must Pay 1 Per Cent ON
Earnings Over $4,000.
Bill in Congress Today Applies
to All u. s. Residents.
BRING REVENUE S10O, 900, 900
Will Make Up for Deficit From
Reduced Tariff.
Tax on Earnings of Corpora
tiOnS to Be Revived.

Washington, April 7-Included in the
Democrat tariff revision bill introduced
in congress today is an income tax
section which would require every resi-
dent of the United States who earns
| more than 1000 a year to pay a tax
of one per cent on his earnings in ex-
cess 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 earns $4,1O0 for ex-
| ample, to pay into the government
treasury an annual tax of one per cent
on s10O or 81.
The bill also would provide higher
rates of taxation for persons with
larger incomes adding surtax of one
per cent additional on earnings in ex-
cess of $40, 900; two per cent additional
on earnings in excess of $4,000 and
three per cent additional on earnings in
excess of $4,000 and three per cent
additional on earnings in excess of
800 900.
Under the surtax provisions the man
who earns only $4,000 would pay to
the government each year at the rate
of one per cent on $4,000 $4,000 ex-
empt) or $3.50. If he earns $4,000 he
would pay one per cent on $4,000 still
and two per cent on $4,000 thus
making his annual tax $3.50.
The man with an income of 100000
would be required to pay one per cent
on 5000 two per cent on 100000 and
three per cent on $4,000 which would
be $500, bringing his total income tax
to $2,2 ,260. The individual with a net
income of a million would pay thus
81, ,260 on his first 100000 and in addi-
ton he would pay four per cent on
,;1I, hi f0fo TOW
to s3S, ,26O.
Re-enact Corporation Tax Law.
The bill also would re-enact the pres
ent corporation tax law imposing a
one per cent tax on the earnings of
corporations stock companies, 1nsur-
ance companies and the like, but 1T
would exempt partnerships. This is
flat 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 COL
lection
The bill also includes under it's pro-
visions the property and earnings in
this country of persons who live
abroad.
1t is estimated by members of the
ways and means committee that ap-
proximatelv 800, ,000, 900 in revenue may
be derived from this new tax, 1nclud-
ing the corporation tax, that amount
making up for the deficit in revenue
to be derived from imports by virtue
of the greatly reduced tariff rates.
Incomes of taxable persons shall in
cl,1da GAINS profits and income de-
rived from salaries, wages, or compen-
sation for personal service OF What-
ever kind and in whatever form paid,
or from professions, vOcauonS, busl-
nesses, trade, commerce, or sales or
dealings in property also from interest,
rent, interest, dividends, securities, in
Guiding income from property, income
from but not the value of property
acouired bv bequest, devise, or de-
scent and also proceeds OF life lnsur-
ance policies paid upon death OF per-
sons insured
The bill allows as deductions in
committing net income all necessary
expenses actually incurred in carrying
on any business, not including person
al living or family expenses, interest
accrued and payable within the year
bv 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 sh1pwreck
not compensated by insurance or
otherwise; debts actually ascertained
as worthless and charged off; also rea-
sonable allowance for wear and tear
on property, but no deduction will be
allowed for expense or improvements
made to increase property value
Exempts stock Dividends.
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
of the president of the United States
during his term, judges of the su-
preme and inferior courts of the
United States and compensation of all
officers and employees of state or
any political subdivision thereof.
1t establishes system of collection
of the tax at it's source, requiring all
persons firms, co-partnerships, COM
panies, corporations, joint stock COM
panies associations or insurance COM
panies and all trustees, executors, ad
miniStrators, receivers, ETC., and Of
ficers 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
come tax due from such person. All
such persons or firms are made per-
sonaIly liable for such tax
Persons or corporations liable to
make return on incomes who fails to
do so at a specified time are made LA
able 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
Girl Accuses DIR. Cook.
San Diego, Cal, April 7.-Dr. Fred
aricl~ A Cook last night was ordered