The Richmond Virginian. (Richmond, Va.) 1910-1920, 1918-08-07
SHARP CLASH RESULTS
OVER WAR PROFIT TAX
No Agreement Reached Between the
Treasury Department and Ways
and Means Committee.
HAS EXTENDED SESSION
Treasury Officials Demand Straight
Tax OF so Per Cent on All Business
Profits Derived From War Con-
tracts or War Business.

Washington. August 6.--A sharp
clash between the treasury department
and the ways and means committee
over war profits taxes in the revenue
bill developed at todays session of the
committee No agreement had been
reached when the committee adjourn
: ed long after the dinner hour tonight
The treasury officials demand
straight tax of 80 per cent on all bust
ness profits derived from war con-
tracts or war business. The commit
tee favors "A double system, including a
high excess profits tax and war
profits tax giving the treasury the al
Tentative of selecting the one which
will yield the government the great
est amount of revenue.
When the committee met this morn
ing It was confronted with clippings
from Wall street publications de
manding a war profits tax. Chairman
kitchin answered these statements by
producing government reports TO
show that certain of the largest cor
porations in the country would pay
nothing If taxes under the war profits
scheme but would be heavily taxed
up to so per cent of their income. un-
plan.
Chairman Kitchin stated that the
difference in the amount that would
be raised under the treasury plan and
the excess profits plan would be con
siderable il the excess profits rate
were made high enough to catch all
those whose profits before the war
were as high as their present profits
r. G. Leffingwell an assistant Of
the treasury department. was before
the committee all dav in support of
the war profits tax plan. He contend
ed that the committee should follow
the English system Of perim posing
the so per cent tax on the profits
made out of the war He did not fav-
or the committee schedule for excess
profits, believing the rates TO be too
low. Chairman kitchin and ma
jority of the members favored both
systems, giving the treasury the al
Tentative of choosing the method OF
taxation that will produce the larg-
est amount,
The committee decided that the
super-taxes on personal income, which
were previously agreed upon. We're too
low and accordingly voted 10 raise
them as follows
On incomes between 5000, 600 and
$500 600. 3 per cent
On incomes between 5000. 600 and
$500, 600. 60 per cent
on incomes between 100000 and
81 600 600. SIS per cent
On incomes between 1000 GOO and
$4,000, 600. 10 per cent.
On incomes OF over SIS 1000, 900. rs
per cent
Property of Germans which has
been seized by the alien property Gus
todian should be taxed in the same
manner as when il was owned by
bonafide citizens of the United States
1t was decided 10 have A Mitchell
Palmer, the Gust odian, before the com
mittee to give his views on the sub
ject
The subcommittee. which has been
considering the question OF luxury
taxes. made preliminary report.
recommending a tax OF 10 per cent on
all articles above certain fixed price
This tax. the subcommittee recon
mends. should be placed on costly
jewelry. clothing and a hundred or SO
other articles on the luxury list sub
mitted by the treasury department.
The report deals with articles in gem
eral use from water cooling bottles to
embroidered slippers and from
keramies TO kimonos
The opinion OF the subcommittee IN
mat where the price is such that the
article in question Is within the reach
or persons of ordinary means there
should be no tax. but where the price
Ia increased before of artistic work
nanship or extravagant use of ma
'erials the excess in price should be
taxed. The tax would have TO be in
the nature of sales tax and in some
cases would be designed hy affixinp a
stamp.