Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1918-10-23
WILL GET REVENUE
FROM WAR PROFITS
Senate Finance Committee Re-
writes the Rates in
Revenue Bill.
NEW SURTAxEs ARE ASSESSED
Incomes Over $l,0OO.o0O Year
Will Pay Higher
Tax.
NEW sURTAxEs ARE ASSESSED

" HSH tNGION. october 2..-rhc war
proiitS and excess profits section Of the
ierenue bill was entirely rewritten by
tnE Senate Finance Committee to-day
New rates. which may yield slightly
.eSS income. but which are calcuIat ed
10 reach more of the strictly war prof
les. were adopted.
The alternative method. permitting
Inc Treasury Department TO collect the
taN under whichever rate would pro-
ducc the largest amount OF revenue
Was stricken out. in accordance with
the suggestion of many lawyers that
such provision would be uncons,itu-
tIonal
An entirely new set of sur,axes for
individual income taxes was adopte ed
also. These rates will make very small
difference in the amour; TO be PAID on
! imcomes w to $4,000; on incomes be
tween $4,000 and sl,000.0o0 the amount
or tax will be considerably lower, but
rQ incomes above $1,000, 900 a year. the
tax will be higher than it would be
under the rate which the House
adopted
The adoption of these changes com
hlne to make II one OF the most i'm
since the revenue bill came from the
House. 1t brings the work OF the COM
Inittee very near TO completion. and it
Is the expectation that the measure
will be in shape TO report 10 the SEN
stc next week.
The new war profits and excess prof
IS section adopted by the committee Is
combination OF the two methods put
INTO the bill by the Ways and Means
Committee with some marked changes
I ne House bill fixed the war profits tan
Il so per cent upon the amount OF me-
ircoine after specific exemption of
5000 and the average OF IT'S pre- war
earnings for 1911; 1912. 1913. The ex-
cess proats tax allowed an exemption OF
$4,000 Plus per cent or the invested
capital for the taxable year and rates
Of taxation as follows: S5 per cent of
the income in excess OF the credits and
not In excess Of i per cent of the in
vested capital: 90 per cent of the
amount of income between IL per cent
ard 20 per cent Of the invested capital
and 20 per cent of the amount Of in
come in excess of 90 per cent or the
invested capital.
| TENS OF rates which the Senate com
intttee adopted Is as follows:
Section soi-That the tax shall be
| ier the following brackets.
| First braoket-Thirty per cent OF the
| 'mount OF the. net income in excess OF
| Cess OF 20 per cant of the invested cap
! iial. =
! second brackes-sixty.per cent OF The
! net income in excess OF 20 per cent Of
/ the Invested capital.
! Third bracSet-The amount by which
| so per cent of the net income In ex-
| the tax as computed under the first
und second brackets.
In any case where the full amount
| OF the excess profits credit is not al
lowed under the first bracket. the part
not SO allowed shall be deducted from
the amount In the second bracket.
The exemptions remain practically
| the same.
CLAIM METHOD CHOSEN 81
| GREATLY SIMPLIFlES TASK
The committee contends tina. the
tl,at put in the bill by the House Com
mittee, and that by combining the two
methods OF computing the tax. all ques-
| ton as TO the constitutionality OF the
|
| proposed is evaded. 1t is not believed
thar the new rates viii produce as
the double system in the House bill.
which was sl.7s1. 100000. On the other
hand, members OF the Senate Commit
tee say, that the rates will be more
| equitable; that they will bear less
heavily upon business that has not
reaped eSorbitant profits from the war
! contracts and that II will deal more
| harshly by those who are the real prof.
teers of the war. a qualifying section
Committee is Intended to protect the se
smaller corporations from unjust taxa
ton; It is = substitute for section so2
Section So2-That the tax imposed
by section S0l shall in no case be more
than 80 per cent OF the amount OF the
not in excess Of 10000, 'pEIs9OS Plus Tep nep
in excess Of $4,000. Nothing in this
section shall be i'll such manner as to
Increase the tax imposed By section
The new surtaxes on incomes are
estimated TO produce a total OF S1,45s,-
| 10000. as against an estimated yield
Of sa3O,0oc,0o0 under the rates which
the House adopted. The Senate plan
! is to add Fer cent 20 the surtax for
| $4,000 -. " :
| Adding to this the sum OF s4t4.o00. 900
which is estimated as the amount to
be yielded By the normal Income rates.
the total from the individual income
TAX is estimated by the Senate COM
! 069,0Oo. tL.' :.