The Birmingham age-herald., 1918-08-15
PROFITS
 TAXP[AN PUT UP
 ID COMMITTEE McAdOO Estimates That Proposed Plan Will Add Three to Four Millions
 Extra to Fund

and means committee today his plan
 for an excess profits tax with an all
 formative war profits levy to be in-
 cluded in the new revenue bill. The
 plan proposes the retention of existing
 rates in the present excess profits
 law with the alternative application
 mum of 80 per cent affecting about
 go per cent of all the business corpor-
 ations coming under. this schedule.
 Secretary McAdoo estimated the
 treasury plan would produce from
 $500. .o00.o 900 to $400,000,00o more than
 under the. plan tentatively agreed to Jy
 the committee recently.
 The secretary was accompanied by
 Assistant Secretaries Leffingwell and
 Love, Internal Revenue Commissioner
 Roper and other treasury experts.
 Messrs Roper and Leffingweu and Dr.
 T. s. Adams, chairman of the excess
 profits tax advisory board of the treas-
 ury, will return to the committee to-
 morrow to present further views and
 the committee hopes to reach tenta- tive agreement by tomorrow night. At the conclusion of the conference Secretary McAdoo and Chairman kitchin Joined in tlt prediction that they would get tosather on a plan, and Secretary ---~--~N~S seSs<cN SAidt yOu Cdn see lLtdL MT. Kitchin and I have no bayonets for each other"
 Despite the increased revenue claimed Tor the treasury plan, which Secretary McAdoo said would take care of exceD- tional cases like the Ford industry. some of the Standard Oil subsidiaries ana others, 1t was stated tonight the bill still falls short tc the extent of between $500 0oo,0o0 aud si,00o.o0oOo of the $S,ooo, 600, i. Yrrl,f A tx,-x - coa, sugar. bananas and other tropical 1 fruits coming through the ports may have to he resorted to. it was said, or
 some other rev tax feature considered l The first break in the committee oc- I cured when Representative Rainy of Illinois, after making a stand for in. 1 crease Of the taxes on estates in excess
 of $1.o000oo and being voted down, an. l nounced he would carry the fight on ths
 floor ot the House.
 QUICK WORK NECESSARY Secretary McAdoo told the committee it
 was imperative that the revenue bill be enacted by Congress before the opening of the campaign for the fourth Liberty
 Loan. September 2s The secretary read l to the committee telegram which he sent to President Wilson July @. sn which he expressed concern at the report that the congressional legislative pro- gramme did not contemplate passage of the bill before the end of October l MT. McAdoo emphasized his statement
 made in telegram to Chairman Kitch- | in from Chicago that there should be a war profits tax at flat rate of 80 per l cent and that the excess profits tax I should not be depended upon to produce ] increased revenue but that notifications are desirable to reduce the inequali- | ties of the present law.
 1 In framing the excess eprofits tax Mr. McAdoo said, should it be decided to modify the existing schedule. changes 1 in rates should be made with view to | producing the same amount o{ revenue as during the past year and fin a way more equal and less fraught with hard ship to small business concernsv
 Emphasizing that no tax should be placed on the income derived from the government bonds as a means of making
 more popular the government war se- curities as set forth in his letter to Chair man Kitchin June 5, Mir, McAdoo said: .I cannot profitably enlarge upon what 1 I thus wrote more than two months ago except to say that the failure to con tinue what is in effect. a F per cent I tax upon normal earned Incomes and the 1 failure to enact diferential of say, 1 5 per cent against unearned incomes, making tax on latter IS per cent. it 1 is estimated by the treasury department, | deprive us of revenue to the amount of 1 $1 ,5, GOO 900. while at the same time seri- 1 ousIy jeopardizeiug the programme for issue of Liberty Bonds of the fourth Lib- erty Loan at AZ per cent. by reducing the value of the. exemption to the hold CTS of those bonds from normal income taxes by an amount equal to one-third. from 15 to 10 per cent.
 Tn speaking of the proposed luxury taxes, the secretry told the committee the purpose of the proposed bill should not be merely to raise revenue but should also be effective in the curtaiing of wasteful expenditures He said, there fore. such taxes as that proposed upon the employment of domestic servants are of great importance"
 The committee was advised against too great an increase in super-taxes on the Er ound that such taxes might become de- structive rather than productive of reve- nu0.