Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1917-11-25

an OH lease rs OF a ptrlSnt lie nature
and the income from an oil lease
no. only means the income I'm the in
vested capital, but also portion OF
ttdt very capital, for every barrel of
oil taken out from the well means
that the well contains just that one
/ barrel less.
This law imposes special hard
ship on the small oil man, who ha.
struggled for years creating prop
orty proving up field, and making
IL valuable The original Investment
was nominal, but the fact that tho
floll has been proved gives it ma
tcrial bona fide value, which he can
dispose Of In the open market far be-
fund the original investment Not
withstanding this the law gives that
-0 n~"|tt Of only per cent
on h.s original investment, which was
4 nominal, and Cla. rf him with the
! ircone OF tho entire flush production.
Large corporations, In cases Of that
+ .." rrp' al'z0d and re-capital-
lied. sold and resold their assets for
itS fun value from time to time. Al
the 9 per cent is inadequate. they
at least may base such percentage
/ on an arpreciable sum, and in tn"
event OF the sale OF any of their prop
cry, the effect on them would not
/ be so disa strous, for IL would be cal
]
/ tween the nm1dnt received and the
| large re-ValuatiOn of the original
/ wild cat lease as entered on the books
Of that corporation. | do not be-
lieve that any individual or company.
whose assets remain IN the form OF
the original investment should be pen
abzed by forcing upon him this hard
ship. simply because he had not re-
valued, resold or reincoi porated.
m normal nTDfity OF
the oil man Will be limited to from
: to per cent or an average
Of s per cent. why should he con-
tinue adding to that capital his knowl-
edge, experience, labor, worry and
take the tremendous risks of the In
dustry? Money Itself today earns an
income IF eight per Gent. and the
demand for money Is growing ever
greater, partly on account Of the
large amounts 20 the required for these
taxes The oil man will thus be dis
couraged from increasing his invest
ment he viii withdraw his surplus
and as much of his capital as he can.
causing lrreparabale injury to the In
dustry as a whole.
| would suggest that foi the pur-
pose Of determining the amount OF
capital invested, the value of all prop
erty should be accepted. at the fair
tax wear, which Is January |. 1917, in
| the present act. Furthermore. | sug-
/ gest that the maximum normal profits
/ in the oil and kindred industries
/ should be raised to between 20 and
| 33 IL per cent
8. I'm reference TO the time of pay
/ mCnt Of the taACS.
No provision has neen made 10y the
| government as to how the large in
tF..r
tex should be paid. Should the gov
eminent rule that payment must be
made In cash, as the nominal income
/ tax was paid heretofore. the govern
ment will impose an impossible con-
dition on the oil man. II is an old
rule that no regulation can be en-
forced upon the public that cannot
possibly be carried out 1t is there
fore. wise for the government to be
circumspeCt and endeaVor to find 4
/ remedy. 1t will be impossible to re-
tnin or borrow enough money to paS
that enormous tax. especially this
first year. when the oil people have
made 40 provisions for such "a con
tlngency, and as Is usual for those en-
gagged in the oil and it's kindred en-
terprises, every dollar possessed by
them Is invested and reinVested and
cannot possibly be converted into
cash, especially at time when thC
demard for cash by the government
would be general, and everybody ii
that case would be obliged TO SELF and
convert their property into cash fol
the purpose of supplying the neces
sare funds for the payment of theil
tax. and, Of course, an extraordinary
supply would lesson the demand
Moreover. 4 sale would not offer any
cure, for the reason that on the very
sale which would be made for the
purpose of financing oneself to NEE
the tax, the profit made on that sale
would again create an enormous IN
come and excess profit tax, making
the original income and excess profit
tax so much larger, that Ii would
practically require three times a'
much assets to be disposed of t.
enable one TO make up the income and
excess profit tax imposed upon tha
new sale.
would suggest the government
ne apprlsed of the impossible condi-
ton the oil men are placed In. and
that the secretary of the treasury he
empowered to provide ways and
means for such company or individual
to paw such tax.
| understand that certain large
corporation has petitioned congress
to permit them to pay the income
war and excess protit taN'ln IlNe an
nual instalments. | believe the gov
crnment can find means to protec
itself in a contingency of that kinC
d. providing such company has suf-
ficient assets to enable 1t to he en-
q, trusted with such an amount
This is not new feature in the
collection Of taxes. In many states
Including even New York state, where
taxes on real estate are not paid, the
lien on the property for those taxes
Is sold to the one offering to purchase
same. at the lowest rate of interest
the owner of the property by paying
the interest semi-annually is not re
quired to pay the principal sum OF
such taxes for Il period of three years
OF course selling the lien would h,
highly Objectionable for many rea
sons I'm the case of the federal taxes
] mn Ll.n.. h. n. AhN tho pnAnrM.