The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1917-09-27

E,UU u
THE adoption by the senate and
house conference committees on the
new war revenue bill, of the income
tax normal and surtaX rates as re-
vised by the senate and designed to
raise SS24,20O, 600 additional revenue
is awakening inquiry among many
men as to what their proportionate
contribution to this fund will be-"
said the statement.
Senate Rates Agreed to.
The officers of the Wells Dickey
Trust company have kept a con-
tinuing analysis of the new wal
revenue bill as it progressed in slow
stages through the house and senate
and their table of the total taxes to
be paid by the recipients Of incomes
of different amounts under the Dill
as it stands today. is Of particular
interest.
The conference committee has
adopted the tax rates as passed by
the senate with only slight readJust-
ments in the surtax rates over $2O,7
coo. The table shows that recipients
Of taxable incomes will pay the fol-
lowing total taxes: On a 100000
income, a tax Of $16.430; on $4,000
tax of $11,230; on $4,000, a tax
OF 9isO0US OH S3VsVOOB a Is~A "a SS,o'C.S.'
on $4,000 a tax of 1880; on $15,OOO,
a tax of $3.50; on $4,000, a tax of
1855; and on $4,000. a tax Of $50.
Four Items to BE Figured.
THE computation OF a person
taxes after the adoption OF the new
bill is a complicated operation for
the reason that the tax is made up
of four separate items, that is, two
normal taxes and two additional
taxes. The present income tax law
adopted Sept. 9, 1915, is continued in
force with no change in rates, with
a normal tax of per cent, with
exemptions of $4,000 for married per-
sons and $4,000 for single persons.
and a graduated additional tax OF
from / to 10 per cent on incomes
over $4,000. The new war income
tax is levied in addition to the pres
ent tax, consisting of second nor
NAL tax of 2 per cent with exemp-
tions Of $4,000 for married persons
81, 900 for single persons and $2OO Tor
each dependent child, and grad
uated additional tax Of from per
cent to so per cent on incomes over
$1,000.
THE maximum rate is upon that
norton of an individuals income
over $1,000, 900, upon which the ad-
ditional tax is so per cent, making
the total tax under both laws IS per
cent.
Income received from corporation
dividends continues to be exempt
from the normal tax under both the
1915 and 1917 laws, making the total
tax 4 per cent lower on incomes from
this source. Distribution of profits
by a corporation in the form of stock
dividends must be included as in
come, and is subject to the addition
al taxes.
Income from municipal bonds
continues to be wholly exempt from
income tax, congress being without
constitutional power to tax munich
pal bonds. This Is unquestionably
the principal reason why municipal
bonds have not receded as much in
price in the process Of readjustment
as have so many high class corpora
ton and railway securities.
Collection on Bond Coupons Changed.
IAN important change in the new
law is the abolition Of collection of
the normal tax at the source on cou-
pons from railway and corporation
bonds. This change will deprive in
yestors of the advantage which they
heretofore derived from the agree
ment on the part of corporations to
paw the normal tax where the same
is required by law to be withheld at
the time of payment. A great deal
Of pressure has been brought to bear
by investors upon the senate COM
mittee, which introduced this pro-
vision, to have the same cut out, as
IL will mean In the aggregate the
payment Of many millions OF tax by
individuals which would otherwise
be borne by corporations. 1t re-
mains to be seen whether the house
win concur in this radical change or
not.
How Bill Complexities Charges.
To illustrate the complicated fea-
turo OF the law, take an income of
$4,000 earned by married man.
Four different items enter into his
tax, as follows:
Two per cent normal tax un-
der 1915 law on income in ex-
cess Of $4,000. !. e., $e,O00--tax,
1920.
Two per cent normal tax un-
der 1917 law on income in excess
Of $4,000, /. e., $s,000-tax, $3.50.
Surtax Of ] per cent on income
in excess Of $4,000 and not over
$500, l. e., $2,500--tax. s25.
surtax Of 2 per cent on income