New-York tribune., 1918-09-13
Exemption Until z Years
After War Proposed in
McAdoo Bill
SIS Impost on All
Farmers Suggested
Manufacturers Protest the
Levies Provided For in
Revenue Bill
Especial Dispatch to The Tr,bune)


agreeable to the Treasury Department,
the Ways and Means Committee,
through Chairman Kitchin, this after
noon favorably reported the McAdoo
bill TO the erlief OF Liberty Loan
bonds from certain taxation and other
Treasury purposes. The committee 3
report accompanying the bill is little
more than a summary Of the principal
features of it.
The report expresses the belief that
the provision exempting Liberty bonds
from a degree of sur-taxation "will
materially assist in the sale of the
next Liberty Loan bonds.o The report
calls attention to the fact that the cx-
emption is made to continue for two
years after the ermtination of the war.
This is q longer period than Secretary
McAdoo first asked for.
The Ways and Means Committee
heard Assistant Secretary Leffingwell
in behalf of the relief measure this
morning. There was no difference of
opinion regarding the necessity of the
desired legislation. The bill will be
taken up tomorrow and put through
the House in an hour or two. It is
thought that some OF the radicals in
the Senate may put up some stiff op-
position there, though Chairman Sim
mons of the Senate Finance Committee
does not think there will be much de-
lay in the upper House.
While the House spent the day large
ly in discussing politics in one form or
another the Senate Finance Committee
was accumulating data that will lead
to many changes of major or minor
nature in the revenue bill. Senators
will radically overhaul the invested
capital definition, it is believed
Another section of the bill that seems
certain to be revised in the Senate is
the estate inheritance taxes It is con-
sidered that the rates in the bill, which
range from up TO 40 per cent, are too
heavy, especially on the type Of estates
not of the mushroom" variety.
The Finance Committee may recon-
mend what is practically an earner's
poll tax of IS year.
A phase of the capital investment
subject presented to the committee to-
day is that relating to the capitaliza-
ton of good will. This subject was
discussed by Vincent G.. Watson. of the
National Association of Credit Men.
The bill does not permit q valuable
possession to be considered as capital
unless it has been realized through a
.salc.
S150O00,000 Annually
Mr.. Watson said there were "thirty
million persons in the United States
earning $1,000 or more d year" He
recommended that an income tax of not
more than $5 be assessed upon all OF
these persons, regardless of other
taxes, income or otherwise. This would
produce S150,0O0, 900 a year if made
collectible at source, he said. 1t is
pointed out thar such tax would go
quite way toward filling the gap
caused by the abolition of beer.
Professor S. B. Lindsay, of Colum-
bia University, appeared in protest
against the application of the estate
tax to bequests to educational and
charitable institutions. He argued that
such tax is in effect double tax,
the state will have to do what such
hequests now do. The traditional Amer
lcdn dItituue was that phllanthrOplc
and charitable institutions, and to
some extent educational institutions.
!. should be supported by private benevo-
lence. If this policy were to be aban-
doned it would mean that the publ1e
would have to assume larger burdens.
Protests Prescription Tax
A. N. Hunt of Boston, representing
the Association of American Pharma-
ceutical Chemists, argued against tbs
administrative practice of practically y
treating standard preparations anC
medicines the same as proprietary
medicines and subjecting them to the
same tax if the manufacturers trade
mark and descriptive designation ap
pears on the label of the contaner
This results III a tax on every pre-
scription, and also on the standard re
medal drugs that country physician:
give to their patients in the absence
of pharmacies.
e: e.. Brokmeyer, representing tn,
> National Association of Druggists, pro
tested against the narcotics section O
. the revenue bill, as it results in tn,
pr0hlbltlon of the use of narcotics il
proprietary medicines, no matter how
small the proportion of them
ne Senators were very svmpatheti
with j. Freeman Marston, of the Bos
VII AoAiNdD SOillp pdUy, WNen he demon
stratedN that the bill as it now read
would Impose a tax on owners of 4O
Boston taxicals sufficient to driv
r them out of business and leave thei
l,6Oo competitors free of taxation
y Small Owners Not Hit
. . The taxicab rate of s ner cent .
' receipts applies only to owners o. o.
g three or more cabs. Mr.. Marston sue
gested that the taxicab tax be levie,
g on on each ride and paid for by the user
r IKE 'he rail way ticket tax.
lhe cereal beverage people. throup,
Iheir representatives, protested agains
, being taxed on the containers as vel
- as on the beverage.
y The National Association of Clean
ers and Dyers objected to the gasolen
{: YAK "a oo0 Of oo2 2 cents gallon. They us
oo,oo0,000 gallons year in their in
dustry, besides 100000 used in de
n livery conveyances.
The National Association of Manu-
: facturers of Proprietary Medicines of
. fered objection to the 10 per cent ia.
n on proprietary medicines.
The "McAdoo" bill as reported t.
. the House is as follows:
. THAT until the expiration of tw
. years after the date of the termina
! ton of the war between the Unite
It States and the imperial German gov
;. ;. ernment, as fixed by proclamation o
70 tho y