The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-08-12
CHANGES URGED IN
INCOME TAX LAW
National Association Body Fa-
vOrs Rcstatemcnt and
Qualification.
II SUGGESTIONS MADE

Seventeen recommendations OF changes
a. the Federal income tax are made by
the special committee appointed by the
National Tax Association to investigate
the act. The committee IL headed by
Edwin X. a. Seligman. The report has
been submitted to the ninth annual con-
ference of the association, now In session
at san Francisco.
The committee fnds that while there Is
no demand throughout the country for a
repeal of the law there Is general dis
satisfaction with its completely and
strong objection to several provisions
that are contrary to the principles OF
just taxation and work unnecessary
hardship. There is need OF correcting
many verbal infelicities in the law. says
the committee. The first n most Inn
portant recommendation Is In favor of a
complete restatement and clarincatlon OF
the law. It's language being in need of
great Improvement.
These are the specific recommended
lions:
That par, Of the act which requires the
collection OF the tax at the source should
be modthed.
\ system OF Information at the source
should be Introduced.
Partnerships should be required to file
Substantially the same kind Of returns as
corporations are required to file and to
pay the normal tax as corporations do.
Individuals should he permitted to de-
duct all losses. including "A reasonable al
lowance for deprcciation incurred in the
business. trade or profession In which they
are engaged, and including also losses Of
property used for Investment or specula-
tive purposes where the gain. II any. would
Expenses incurred by individuals in
making Investments and managing prop
erty, with respect to which the income IL
taxed, should he permitted as are expenses
of carrying on business.
Allowances for the depreciation OF prop
cry and for the depletion OF natural re-
sources should be on a basis which will
permit the return OF the capital invested
sible coincident with the obsolescence of
the property or the exhaustion of the re-
individuals should be permitted to de-
duct taxes paid within the year In foreign
countries upon the property or business
from which the taxable income was de
rived.
The specific exemption should be lowered
and the language OF paragrap phi &C" should
individuals having a gross income eauaI
70 or exceeding the minimum exemption
should he required 10 make returns.
Taxpayers keeping books of account In
accordance with statutory requirements oi
well recognized methods should be per.
mitted to make their returns based thereon
Every corporation should be permitted
TO deduct all amounts received by II within
the year as dividends upon the stock OF
$3.50 ''s ~ hAipHN Jolnl STOCK COmpdftes
or associations, subject to the income tax
The parent and its subsidiary corpora
lions should be recognized as o single
enuty Tor purposes Of the return in cases
where they constitute "A single operating
system or where in determining net income
Tor their own purposes no recognition In
accounting Is made Of the subsidiary com.
panies as distinct operating unities, and In
az cases where ali the stock OF the sub.
sidiary company Is owned by the parent
company. a consolidation OF figures should
DC allowed In appropriate cases subject &c
the approval OF the Department.
Taxpayers should be permitted with tn,
approval OF the Commissioner of Interna
revenue TO adopt the practice of determin,
ing ana reporting gains or losses by an
hual inventory OF values.
Application for refund OF taxes will
e~phseuuent right of appeal from decision
"I the department should be allowed no
only as ~ present within two years from
date OF pay fnent Of the tax. but also a
q matter OF course at any time withou
limit AS an offset where additional TIA,
ment.
The permission now granted to official
OF states levying an income tax to in
epect the returns OF corporations shout,
De extended TO the returns OF individuals
1t is recommended finally that pro
vision should he made for a more elab
crate publication and analysis Of incom,
tax statistics.