New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-08-18
Wants New $7,538,945, 900
Loan To Be Floated
at Once
3 IL Per Cent Issue
Would Be Retired
Republicans in House Back
Democrats in Support
of Plan

WASHINGTON, Aug. 17.-Issuanee
of S7,538, ,945,000 worth of per cent
Federal bonds, subject only to income
super taxes, war profits and exec
profits taxes, and designed to provide
81 1000, 100000 for further Allied loans
and to retire the $3,000,000,0O0 non
taxable 3l5 per cent issue, now author
lied to cover loans to the Allies, is COW
templated in suggestions submitted by
Secretary McAdoo to-day TO the House
Ways and Means Committee.
Receipt of the suggestions caused
immediate activity among both Demo-
Gratis and Republicans of the committee,
many of whom are opposed to the de-
tails of the Secretarv's plan. While
taxing the bonds is generally favorel
something more concrete than the
Secretary suggests, such as fat levy
of per cent on the interest rate, or
application of the income tax, appears
to be more generally desired by House
members.
The per cent interest proposal
probably will be accepted by the COM
mittee. The Secretary has impressed
members with the necessity of prompt
disposal of the bonds and the possibili-
ty of attaining this result by an in
creased rate. Only most unreason-
able tax rate, it is agreed, can prevent
a lively demand for the bonds at per
cent. The fact that they will be ex-
empt from all save Federal taxation is
in itself sufficient inducement to create
a good market, and predictions Of bond
experts that per cent rate may
carry the bonds above par is expected
to increase the demand.
Protects Small Investor
One of the principal arguments ad-
vanced for the Secretary's plan is that
il would protect the small investor.
Surtsxes would not apply, under the
revenue bill now before the Senate on
incomes of less than $4,000. Few. ex-
cept the very large investors, would be
affected by the war and excess profits
taxes, it is believed
Variations in war and excess profits
taxes are so great that it is difficult
to present even a general idea of what
rates might be collected through such
sources. Calculations on supertax re-
turns, however, are easily made. Un-
der the proposed law, for instance, the
supertax on s375,000 worth of bonds
would be $3.50, and $500 on S500,000
worth. Thus, the holder of $375,000
worth of per cent bonds would re-
ceive a net income of 1915 per cent,
while the holder of a 100000 allot-
ment would receive 3.9 per cent.
Members of both parties in the
House are demanding the establish
ment of definite bond marketing and
retirement policy, and this is likely to
delay passage of the bill somewhat.
1t is predicted, however, that the bond
issue bill will pass the House within a
week after the Ways and Means Com
mittee meets, August 25.
One OF the chief objections TO the
Secretarys plan, urged at the capital,
is that it proposes to leave the inves-
tor largely subject to the whims of
future Congresses and the fortunes of
war. Changes in the various tax lev
les proposed are liable to ensue at any
time.
Republicans Approve
Representative Moore. of Pennsyl-
vania. who, in the absence of Repre-
sentative Fordney, Of Michigan, is the
rapkipo Ronuhlican nepher ~ the