New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-04-16
Income Exemption To
Be Reduced to $1,50O
and Levy Increased
Many New Sources
Of Revenue Cited
Liquor, Sugar, Coffee,
Railroad Receipts to
Pay Share

Washington, April 10. -Administra-
ton suggestions as TO possible new
sources OF taxation through which to
raise approximately one-hslf OF the
estimated cost of the first year OF the
war, or Sl.SO7 ,250,OO0, were submitted
by Secretary McAdoo tonight to the
Senate. Finance and the House Ways
and Means Committees. The other
half of the cost is 70 be provided by
$4,000, 900 Of the bonds authorized
by the War Revenue Bill, passed Sat
urday by the House and which is ex-
pected to pass the Senate this week.
Outstanding in the suggestions are
greatly increased income and excess
profit tax rates, taxing of many import
ed articles now admitted free and
stamp, liquor. amusement, sugar, coffee,
tobacco, soft drink. freight and passen-
ger transportation receipt and automo-
bile taxes. All of the data is sent 70
Congress for its information and with
out recommendations from the Treas
ury.
Probably the most farreaching pro-
posal concerns income taxes. The Sec
retary estimates that 90 per cent IN
crease on both individuals and corpora
tions for 1916, collectible next June,
would yield sl65.OOO.OOO additional.
To Lower Income Exemption
For 1917 he points out that TO lowes
the income tax exemption from S3,OC>
to $1,000 for unmarried persons, and
from $4,000 to $1,000 for married per
sons. and to leave the normal tax at
2 pc. cent, but 20 raise the supertaHes
materially, would make the law pro-
duce s34O,OOO,000 additional in June,
1918, without changing the corpora
ton TAX. The highest rate on super
taxes under the plan outlined wodld
be 40 per cent of all incomes over ST.
900, 900.
Increases in the excess profit tax
both by making the present law ap-
rlicable TO the calendar year o. 1919
and applying new increases next year.
he thinks, would raise 1926 100000 this
wear and 5000 900 900 additional next
year.
Other sources, the Secretary believes,
could be made 70 yield additional in
come as follows:
IMPORTS Taxes on articles now sd-
mitted free, S2O5,OOO, 900.
TRANSPORTATION Freight, $780,
900. 900; passenger, S3j,O0O,OOo.
SUGAR Excise tax, s92 200.
GLUCOSE Excise tax. s6,0OO,O00.
PETROLEUM-R Refined, excise tax,
SIS, ZOO, 900.
AMUSEMENTS- Stamp taxes on the
atre. baseball and other tickets, $751;
900, 900.
LIQUORS Distilled spirits, $4,000
600; fermen.ed liquors, s30,000.o0o;
rectfed liquors, sl2,500,00O; denatured
alcohol. $1,000. 900: wines, S6,7o0,000;
soft drinks, sl9,20O,0o0.
TOBACCO Smoking aHd chewing,
s2j. .OO0. 900: cigarettes, Sl7,OO0.00O;
cigars, sll 500, 600: dealers in cigars,
cigarettes. etc. Si,s00,000; wholesaIs
dealers and jobbers in tobacco, S2,o00,-
900: snuff. Sl,j00,0o0.
AUTOMOBILES - Trucks, pleasure
vehicles and motorcycles, Sls,s00,o0O.
MUSICAL INSTRUMENTS - Excil
tax on pianos, Photographs etc"
100000.
STAMP TAXES Miscellaneous, $751;
800, 600.
Consideration o. The suggestions will
begin Immediately IN the Ways and
Means Committee. bill probably will
be reported by II within TWO weeks.
Grading of Income Tax
The revised arrangement OF super
taxes on incomes as outlined would be:
Incomes Of $4,000 to $4,000, per cent,
$4,000 10 $4,000, per cent; $4,000 TO
$4,000, per cent; $4,000 20 S2O,OOV,
per cent. S200OU 70 $4,000, per
cent: $4,000 TO 100000, 10 per cent,
S6O. 900 10 $4,000, IL per cent; $4,000
to 100000, 10 per cent; 100000 10
sl50,000, 20 per cent: sl5O,OO0 to $500
OOO, 20 per Ctbt, S@vVsVvV " TifVVV'VvNt
1914 per cent; Sl,0OO,0OO and over, 40
per cent.
This revenue Mr.. McAdoo wrotP,
"would be further increased II the in
come from state and municipal securl-
ties and state and municipal salarie.
were made subject 20 the income tax"
II the present excess profits tax OF
p.r cent on corporation and partner
shin profits Of more than $1,000 and
per cent OF invested capital were made
applicable to the calendar year 1919,
the secretary estimates, II would yield
s226. .00O, 900. Corporations and part
nerships would be given until Septem-
Der 20 pay the tax.
As TO the excess profits tax for 1917,
collectible in June, 1918, the existing
law allows an exemption Of $1,000 and
per cent on invested capital, and
levies s per cent tax on the remainder
OF the profits OF corporations and part
nerships. IL this tax. allowing tbs
same exemptions, were increased to 10
per cent on profits in excess OF 3 per
cent and not over 10 per cent OF cap
i,al invested. 70 Is per cent on profits
in excess Of Is per cent and not over
% per cent Of capital invested, 20 20
per cent on profits in excess OF 20 per
cent. and not over so per cent OF capt