The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1915-12-08
Secretary McAdOO Proposes
Radical Change in Incomes.
Lower Exemption Limit $4,000
Married, $4,000 Single.
MAY TAX AUTOMOBILES, TOO
"VariOus Other Things" Send
Shudder to Burdened Citizen.
"PeOpIe of America Have Rea-
son To Be Happy"-McAdOO.

W dSHlUBICH. u - Lee --HNeANANeAA
changes in the income tax to reach
thousands not now subject to its pro-
visions and to improve the machinery
of collection were suggested to con-
gress today in the annual report OF
Secretary McAdoo as means by which
the greater part of the additional rev
enue needed to pay for the admin
fstration's national defense plans can
be provided. The secretary proposed
to lower the exemption limits so as to
tax married persons with incomes as
low as $4,000, and single persons with
$4,000 incomes. The exemptions now
are $4,000 and $4,000 respectively
Increases in the collection force,
requirement that returns must be
made of gross income in place OF net
income. and change so that the tax
shall not be withheld at the source
were among Mr.. McAdoo'S other Sug-
Sestions. He made no estimate of the
number of persons who might be taxed
If the amendments were adopted, nor
the amount that might be expected,
bur in connection with his request for
larger collection force, he pointed
out that examination OF the past per
sonal and corporation returns showed
that SO per cent of those inspected
disclosed that additional tax was due
the government
on the basis of the examinations,
more than S4.60O,00O in personal tax
and more than S2O.S91,00O in corpor-
alton tax still is due the government
Would Tax Autos.
MIR. McAdoo expressed the belief
that with return of peace in Europe
customs receipts which fell off $50
600 600 in the last year Will increase
and that the legislation suggested
with d provision TO make the surtax
of the income tax law applicable at
$4,000 instead of $50. 900 the whole
or part of the additional revenues can
be raised Taxes on gasoline, crude and
refined oils. horsepower OF automo-
biles and various other things are
suggested as further revenue raising
measures.
The total estimated appropriation for
the fiscal year which begins July L,
next Mr.. McAdoo puts at S1.2S5,S57,-
SOS including S316.364S79 for the
postoffice. which is reimbursable, and
about $90.000.000 more for the Pana-
ma Canal and sinking fund. Receipts
for the same year based on existing law
without extension of the sugar duty
or the emergency tax. Mr. McAdoo
puts at SS5O.2O0.0O0 and ordinary dis
bursem6nts at SSS2901, 900. leaving
an excess of disbursements over re-
ceipts if legislation is not passed to
change conditions. or S252,701,OOO. AS
explained in his recent statement how
ever. that amount would be reduced to
about $4,000, 900 by the extension of
the emergency and sugar tax laws.
inaccurate Returns.
Many Inaccurate returns are
made" said the report, some delib-
erately and some ignOrantly, and there
are, without doubt, wholesale eVasions
of the law throughout the country 1t
is absolutely certain that the govern
ment losing through inaccurate re-
turns and eVasions of the law a sum
many times greater than the cost of
the necessary field force to investi-
gate and check the returns and to
bring 10 account those who are failing
to make returns required by law"
In keeping with his recent an
nouncement, Mr. McAdoo suggested
the present stamp tax and the exist
ing duty on raw sugar should be re-
tanned in force and said again that no
issue of bonds is necessary either to
provide for current expenses or in an
ticipation of added burdens incident to
a policy of military preparedness.
THE policy of providing for the eX-
penditures of the government by taxa
ton and not by bond issues. said the
report. lis undoubtedly a sound one
and should be adhered to. A nation
no more than an individual can go
constantly into debt, for current eX-
penditures without eventually impair
ing credit. A wise, sound and perma-
nent policy of raising the additional
revenue required for preparedness and
the expenditures of the government
should therefore be devised and
adopted.
THE European war produced in
evitable suffering in this country. as
well as in Europe" said the secretary.
"Our industrial situation, for a time.
was seriously hurt, and ootton-g grow
ing states of the south sustained heavy
losses through declines in the price of
cotton. Every power of the govern
ment was eXerted to mitigate the situ-
alton and 1 believe it is not inexact to
say that but for the active agency of
the government in protecting and con-
serving the business interests of the
country during that critical period
grave disaster would have resulted.
''It is a pleasure to acknowledge that
the efforts of the government were
seconded and supported by the earn
est and patriotic cooperation of the
business interests of the country Dur
ing the year there has been a steady
healthy forward movement in every
line of activity, until now prosperity
has been firmly established through
out the country.
Mr.. McAdoo included letters from
mercantile agencies to support his
statement, and quoted figures on rail-
road and other business operations to
show increased activities.
The financial situation of this
country. he continued, has never
been so strong and favorable as now
Our financial resources are the great
est i'll our history. and our banking
system. through the creation of the
federal reserve system. is now the
strongest in the world. In every re-
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