Arizona republican., 1917-08-07

committee said it's plan is similar to has had marked success.
 We must face the possibility, even the probability" the report stated, of even higher taxes than are now pro- posed in this country and we must ad- just our system so that it will work satisfactorily even unGer increased rates. Your committee has not been able to find any satisfactory reason why individuals engaged in trade and business should not be subject to this tax (War profits) as well as corpora tions and partnerships" Under the present law, the report stated, inflated values to patents and trade marks and watering of corporations stocks makes evasion of the revenue law possible while the committees rev basis is be- lieved to meet the situation. Senator Simmons also pointed out that the new plan is a war profits tax rather than | all excess profits levy.
 The new tax of one cent for each g |, cents paid on parce-s post packages was said in the report to remove dis crimination in favor of the railroads and the parcels post.
 Tn addition to this" the report said. your committee can see no intrinsic reason why, in this present emergency, | the government should not myo.e a tax upor this method of transportation especially in view of the fact that tue rates on first and second class mail are | increased"
 | The house five per cent taxes upon electricity, gas and local telephone 1 service were eliminated because it ap- | peared to the committee that this tax | fol vi
 on the people of moderate means as well as the poorest classes who at the present time depend very largely in
 the cities upon gas or electricity to
 furnish them with both light and heat
 for cooking as well as, in many cases,
 with power for running small fnachin-
 cry like that of the sewing machine. ] The committee felt that q tax of this
 character ought not to be imposed unless a point was reached where it
 would become necessary to tax every thing susceptible to taxation. Light
 and heat are the very last things which
 should be subject to taxation. Fol
 similar reasons the committee recon
 mended that the tax upon charges foi
 telephone service to subscribers be
 eliminated
 Striking out of all insurance taxes
 from the house bill was based upon the
 belief that excise taxes upon insurance is a questionable principle and should
 be subjected to tax oniy as last re l sort"
 Elimination or reduction of all oi the five per cent gross sales tax upon many manufacturers was defended be l cause the manufacturers also must pay nigh income and excess profits taxes Your committee felt" the report said | that only where the conditions are eX- ceptional should such manufacturers | gross sales tax be justifiabe.' For | these reasons the house tax on patent
 medicines was reduced to two per cent
 Proposed new federal license tax OH
 motorcycles and automobiles based up
 on the original selling cost in lieu of 1 the house manufacturers taX, was eX
 plained as follows:
 | "A gross tax upon automobile manu l lecturers was first considered, but on
 thorough investigation it appeared that 1 over 50 per cent were making very
 small profits. A few were making enormous profits. A gross production | tax in size sufficient to produce a sub
 stantial return would have driven out of business a large majority of auto
 mobile manufacturers. Your committee | concluded that the automobile was a f proper subject for a war revenue tax | and recommends for the high gross
 sales tax, which might or might not be passed on to the purcnaser. a moderate excise tax upon the owners of automo- piles and motorcycles"
 Declaring that the new tax on cab
 erets and retention of taxes on other amusement admissions is justifiable | the report said the tax on moving pie ture theaters charging less than 25 cents had been eliminated, because:
 The moving picture show has be- come a national institution It pos
 sesses many valuable educational fea
 tures They are largely patronized by | people Of small means