New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-07-02
The Senate's Tax Bill


ourh. conscientious workmanship. Inc
House Ways and Means Committee ieii
long AGO into the evil habit OF Jammng
through tariff and revenue measures con-
structed on the hit-or-miss plan. In WHIP
ming together this years monumental TAX
scheme the House leaders were ilt'le
more negligent and slipshod than usual
M Kitchin besought members 10 take
tho work of the Ways and Means Commit
tee on faith, at the same time cynlcaliy
acknowledging that he and his associates
had precious little faith in 1t.
The Senate Finance Committee has mao
70 do a bad Job over again. 1t is 10 De
congratulated on the patience and sEiii
win which it has brought order out OF
chaos. 1t has applied an inte.hgiDie
theory Of war taxation. BY SO DONG "
has been enabled to drop out OF the mouse
hill & great many tax proposals which
were III advised and others which were
manifestly insincere and vexatiouc.
The Senate bill seeks to raise only
1882 100000. The total carried in the
House bill was S1SOO,O00,0OO. Shortly
before the House bill was completed Sec
retary McAdoo urged the Ways and Means
Committee to increase the total of taxation
n s2.2OO.OO0.O0O. The Senates bill rep
resents a much fairer balance between
money to be raised for war purposes by
taxation and money to be raised by oona
sales than Mr.. McAdoo's UNDECIDED pro-
qramme did. or even than the House Dill
does. For the first year of the war the
+ax allotment ought not to be immoderate.
1t can be increased as war demands IN
crease. and a gradual enlargement OF the
ratio Of taxes to bond issues vii! have
less disturbing effects on business than
a very high levy at the start would nave
The Finance Committee has cut out the
questionable retroactive tax on income 1or
the wear 1916 which the House approved
That is a victory for common sense. Inc
foolish horizontal increase Of 10 per cent
in all import duties, with levy OF III per
cent on all imports not now dutiab!e, was
also eliminated. This was vicious, lazy
mans device for raising money. 1t would
have nut new taxes and higher taxes on
foods and many raw materials which the
country is now in great need Of, A con-
sumption tax on sugar, tea and coitee mas
leen properly substituted for the 10 per
cent import tax.
The Senate has readjusted the income
surtaxes so as to lower the rates on in
comes exceeding $4,000. These were too
high. and they defeated their own purpose
70 some extent because Of the fact that
income taxes paid one year are deducti-
BILE from income the year following. The
Finance Committee has also rewritten the
excess tax on the war profits section OF the
House bill 80 as TO reach to far greater
extent wealth created by war conditions.
Increased war profits are the most equita-
bic source of war revenue. 1t is only
fair that those whose profits have been
abnormally enlarged by the war should
contribute in the largest proportion to
meeting the cost Of the war. Graduated
taxes on excess war profits are to be
levied UP TO 40 per cent, whereas the
House bill imposed a fiat rate OF per
cent, which would have left the corpora
tons enjoying phenomenal profits under
war conditions practically untouched.
The Senate draft imposes stamp tax
on checks This source Of revenue was
strangely neglected in the House. The
check tax has proved one Of the simplest
and least onerous Of all our stamp taxes
By the Senate bill checks for less than
s. are to be exempt. No reason is given
for this omission. The check tax should
be utilized further as source Of revenue
In one respect the Senate committee
amended the House bill without improving
il. 1t struck out the wholly jus'ifiable
increase in second class postage rates
which the House approved and the zone
system Of apportoning long haul second
class charges. In order to placate the
clanorous benefciaries OF the present
second class postal subsidy the micro
scopic fat increase of u cent pound
for second class mail was made. 1t was
then sought to offset the loss on second
class carriage by levying a special per
cent tax on the profits Of newspaper and
magazine publishers. This is a discriml-
natory class tax, wholly without excuse
Publishers as a whole would have to pay
Il merely in order 20 secure continuance
OF the governments subsidy TO the owners
Of publications Of very general circulation
Who do not want 10 surrender the beneht
Of the present gross undercharges On long
haul business.
On this point the House was right II
had the courage 10 abolish the obnoxious
long haul privilege and TO try to reduce
the governments present enormous Joss on
second class mail transportation. We
ho,e that either In the Senate or In con-