The Brattleboro daily reformer. (Brattleboro, Vt.) 1913-1955, 1918-08-07
NJ ADOO WINS POINT
OVER PROFITS TAX
Committee Forced to Con-
slider Agreement So as to
Reach PrOfiteers
RAISE LEVY ON
IMMENSE INCOMES

vanced-Sub Committee Unable to
Make Recommendations on Proposed
Luxury Tax.
WASHINGTON, Aug. THE ways
and means committee, which is drafting
the new war revenue bill, has begun a
reconsideration of the tentative agree
ments reached as to excess profits tax
es and individual income taxes. The re-
consideration was the result of represent
tions made by the treasury department
that the proposed excess profits tax, rang
ing from 80 to so per cent, would not
reach profteers mentioned by President
Wilson in his address to congress or raise
enough money.
1t has developed that Secretary Nc
Adoo, supported by President Wilson,
is insisting upon pre-war tax of so per
cent--a modification of the English sys-
TEN coupled with an invested capital
tax This recommendation was made by
Secretary McAdoo in a letter written to
Representative kitchin, chairman of the
ways and means committee, early IN June.
Mr.. kitchin, then dominating the com
mittee, ignored the recommendations OF
Secretary McAdoo, and proceeded to write
| bill which merely raised the tax rates
of the present system of assessing wal
profits.
| The committee proceeded to frame il
tentative way a bill which was based
entirely upon a percentage capital tax
1t is understood that Chairman Kitchir
sponsored the excessive profits tax baseC
on capital wherein the rates changed
from 30 to so per cent As the actor
of the committee In this respect becami
known, members began to hear their con
stituencies demanding to know why
tax which, it was declared, would no
reach the alleged prohteers had beef
agreed to-
In the last few days it has been ap
parent to members who followed Nh
Kitchin that the plan was neither ac
ceptable to many people or the admins
tration When this condition became pre-
nounced, following the offering OF a
amendment by Representative Crisp c
Georgia suggesting that both the Ems
lish system and the excessive profits pla
worked out by Mr. kitchin be adopted
: |
, tons side of the case.
This was presented today by f. r. {
Letiingwell, assistant secretary of tn
treasury, who presumably spoke fc
Secretary McAdoo. The clash betwee
5 treasury. experts and Mr.. Kitchin occi
f pied most of the day The former col
: tended that the excess profits schen
would not reach prohteers, and was NJ
I a sane and equable system of levyir
war profits. At the end of the day, a
Gording to the members, indication
were that the committee would abandC
f the plan sponsored by Mr. Kitchin al
= adopt the system outlined by Mr. L.
$ hngwell In brief, the plan outlined
;. Mr. Letlingwell is:
1 The pre-war standard of assessing W
: profits as in vogue in England, makil
9 the tax so per cent on profits i'll exec
of the average pre-war profits for thr
9 or five years previous to the war
In addition to this the treasury OF
II Gals proposed that there should be
II capital percentage tax from 20 to 60 p
e cent, as at present, and that the CO
IS pOraton shall be required to pay tn
# tax of the two provided which wou
= bring the greatest revenue to the Cover
l ment.
IL Mr.. Kitchin's present plan provides
u an excess profit tax with a specific {
IL emption of $1,000 plus 10 per cent on
O. amount of invested capital and upon the
=. rates Thirty per cent upon the net
70 come in excess of exemptions and not
: excess of 90 per cent of the net incom
80 per cent in excess of 20 per cent of
- net income and not in excess of % |
- cent; so per cent on The net income
excess of % per cent.
e Mr.. Kitchin said tonight that he v
ar not averse to writing bill which wol
y carry not only the above excess pro-
- plan, but the English pre-war stand;
as well, so that the government mil
impose whichever plan brought the la
est return. The only difference betw,
his latest proposition and that of the tire
Al ury is that the treasury wants the +
tn lish system coupled with the present
lie cess profits rates of from 20 to 60 per C
ot rather than the graduated taxes with
lie top rate at so per cent.
ry Representative Moore of Pennsylva
lr- offered an amendment which was ado
Ie; ed, increasing the surtaxes with
or agreed to were entirely too liberal to
be rich man while imposing a very he
ice tax upon the individual of small incc
I'll TIE surtaxes agreed to arc as follows:
see Incomes from S 100000 to S 100000. ;.
ore Incomes from 900 to 100000. !.
Incomes from 100000 to l000.00 :.
Incomes from I 600 0O0 70 = O10 600