The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1917-11-08

II Is STdStly. eXnlDltlOn OF the III
efficiency of the congress of the United
States that a month after it enacted
-ecpiece of major legislation-for, GER
tainly, the war tax law may be SO
racterized-nobody yet knows what
its most important section-the war
excess profits tax-really means. Both
the senate and the house repudiated
the recommendations of their own
committees of experts, tore their re-
spective drafts to pieces, failed to
come to an agreement with each
other let an entirely new bill be
drafted in the conference committee,
wherein the uncouth and unlettered
Kitchin buffaloed his colleagues with
threats of holding up the whole bust
ness-and, finally, the two houses of
congress enacted blindly this bill,
whereof they did not know the terms
and the meaning, such as they were.
Nor have the ablest legal minds of the
country since then been able to un-
ravel them. One distinguished lawyer
has remarked that 1t will require a
hundred hearings before the commits
sioner of internal revenue before the
excess profits law can be made clear.
We arrive, therefore. at the conclu-
sion that the important subject of
taxation is really to be determined for
us by division of the bureaucracy
rather than by the duly elected re-
personalities of the people. The
only redeeming feature is the hop,
that congress when it reassembles in
December, will correct things.
In the meantime we get some clear
err ideas respecting the bearing of the
war tax law on mining companies al
though nobody yet has the temerity
to say with assurance approximately
what any company will have to pay
In the case sof the Utah Copper COM
pany, for example. estimates of the
excess profits tax range all the way
from SO per share to $40 or $12, or
more. The only things about which
we have clearer views relate to the
matters of capital and deduction from
income on account of depletion.
In the matter of capital, corpora
tions are allowed to include surplus
used or employed in the business.
Many corporations, including mining
accumulated previous to
1917 large sums that had not been dis
tributed and probably were in excess
The war tax law as enacted is in favor
Of companies of large capital, like
Anaconda, and adverse to those of
small capital. like Utah, which have
failed to write upon their books their
actual increase in value. The more
such companies are able to take ad-
'antage of their SURPRISES as a basis
II figuring, the better II Is for them |
I appears now that the law permits |
my company to include in capital
uch sums as are invested in Liberty |
'onds. Therefore any company pos
essing a surplus in excess of the
eeds of its business may remove
ny doubt or controversy on that score
y investing such surplus in Liberty
onds. This has already been done on
l. extensive scale by many companies.
The other ameliorating condition is /
he provision for reasonable allow
nee, out of net income, for exhaus-
on of property, which in the case of
lines is put in the following obscure
nguage, which exhibits a high de.
zee Of turbidity Of thought "In the /
Use of mines. reasonable allowance
r depletion thereof, not to exceed i,
e market value in the mine of the {
oduct thereof. which has been mined IA
I'd sold during the year, for which /
e return and computation are made" q
There is, without any doubt, COM Z
ised within the above provision the O
ca, eminently correct, that the in 4,