The Washington times., 1917-01-08
win Tackle Revenue Problem
Raised by Sinking Treasury
Balance This Week.
MAY REVISE INCOME TAX
Leaders Casting About for
Methods of Raising $780,
100000 to Meet Deficit.

Troubled Democrats of the House
revenue problem-a question involv-
ing the raising of about 5000, 000, 900
additional funds for a sinking Treas
ury balance.
With the return OF Chairman Kitch-
in, of the Ways and Means Commit
tee, to Washington, that committee
plans Immediately to get busy cast
ing about for things upon which to
lay a tax 1t is now admittedly the
plan of the Government to issue some
$500 900, 600 in bonds-but about
5000. 900 900 more must be raised by
taxation, according to the recent an
nouncement from the Treasury De
partment.
A lowering OF the income tax ex-
emption, adjustment of the free list
and a horizontal increase of about 10
per cent in all existing duties, con-
sumption tax on sugar, a new tax on
excess profits" of corporations, in
creased levies on wool, manufac-
tured rubber and coffee, and a revi-
sion of the inheritance tax law, are
means under consideration by mem
bers of the House committee.
Changes I'm Income Tax.
The taxation OF incomes as low as
81 900 per annum has been suggested
by some of the Democrats, although
it is generally realized that so radical
a lowering of the present exemptions
would be quite unpopular.
The fact of the revenue situation Is
that the Democrats are fioundering in
sea of suggestions and no decision
has been reached-although Ii Is rea-
sonably certain there will be material
notifications In the income tax law.
MANY things have been suggested
upon which we might put a tax
to raise the 500, 100000 to meet the
deficit that IL is said will be present
at the end of the next fiscal fear
said Congressman Henry 7. Rainey,
a Democratic member OF the commit
tee.
situation Is Indeanite.
"These suggestions range from pro-
posaIs to levy consumption taxes to
revision of the rates of the existing
tariff law. One member of the com
mittee has suggested a horizontal in
crease on all tariff rates, but thi5
proposal is so far one that has been
discussed individually by members OF
Congress, but has not been taken UP
as a committee proposition In a
sense, 1t, is an unscientificy plan-be-
cause some articles would stand an
increase where others would not
but the suggestion also has its ad
| vantages.
There is nothing definite in the
situation today. 1t has been pro
posed, for instance, to tax raw rub
| her and increase the tax on manufac
tured products. Again a consumption
| tax on sugar, tea and coffee has been
! advanced, but i doubt that serious
consideration will be given the plan
| to levy a consumption tax, although
| coffee and tea now yield revenue in
England.
ssTarIfr For Revenue, Question.
However, a consumption tax on
sugar, including imported sugar and
domestic sugars, including beet
might prove practical. / do not say
that anything like this will be done
Out IL Is just Olt VI AAC piohS bSAAB
talked about 1t is said the beet
sugar industry. for instance, Is max
ing large profits and could stand such
| a tax. II it were levied the import
duties might be readjusted and the
tax on sugars made uniform all
around.
There is also talk of increasing
the Ievies on cigars, cigarettes, beers
and liquors.
"a high protective tariff will not
meet the situation. nor does the situa-
ton support free trade theories. 1t is
purely a question of tariff for reve-
nue. and that is the way we must
approach the question.
Absence of Tariff Data.
"If we were to restore the ole
Payne.Aldrich rates we could get only
about S95, OOO. 900 more a year. Con
gress cannot devise a protective tariff
that would yield the necessary reve
nue., because the more protection
there is, the less revenue. Import
| tariff will by no means suffice Il
raise the revenues we will need a
the end of the next fiscal year anc
! thereafter, and we must cast abou
| for some other means.
zone unfortunate angle Of the sit