The sun. [volume] (New York [N.Y.]) 1916-1920, 1918-05-27
HIGH TAX BILL
WILL BE DRAWN
THIS SUMMER
Republicans Refusal to
Compromise Insures
Long Session.
DRASTIC RATES PLANNED
War Profits, Incomes and Lux
uries to Bear Brunt Of
New Levies.
DRASTIC RATES PLANNED
Special DespoteA to TIE srS.

WARRINGTON, May 26.--War profits.
individual incomes and luxuries will
yield most Of the taxes to be levied IN
the coming revenue bill With the COL
lapse Of the Administration's final offer
Of a compromise plan for postponing the
legislation until winter. which was re-
jected by Republicans Of the Senate FL
nance Committee, leaders in Congress
put their thoughts to-day on a long
summer session and the draft Of the
greatest revenue bill in this country's
history.
Democratic leaders are decided that
the things most heavily to be taxed in
the order OF their revenue producing
expectations are:
War profits. bearing rates Of tax
alton that will be almost conhscatory
beyond a certain return. That IL. the
bill will In all probability attempt to
define a reasonable return upon .
certain investment and will take near
ly all Of any sums remaining above
that amount The British law takes
so per cent.
The individual incomes OF wealthy,
persons. including inheritances. the
$1,000. 900 incomes This Is likely to
be increased by one-half.
Non-essentials and luxuries. This
heavily taxed list will likely include
items which are In the border zone
as between luxuries and necessities.
Fight on Consum ption Tax.
A big hght is ahead over a consump-
tion tax which would reach to every
breakfast table. Sentiment has not yet
crystallixed as to the necessity Of taxing
table supplies. suoh as coffee. tea and
sugar. but the revenue hunters may be
forced to invade that list.
Southern Democrats are already un-
easy over the possible coalition Of
Northern and Western members which
might force a sisable tax on each bale
Of cotton. This issue IL to be fought
out both in committees and on the hoor.
1t IL practically assured that In con-
siderins the income tax Congress will
Wipe out the existing law and start over
again so as to avoid complications Incl.
dent to administration Of the present Law.
which carries two normal taxes and va
r!ous surtaxes. One normal tax and a
scale OF surtaxes hereafter are the pat
tern now under informal discussion.
Hearings before the Ways and Means
Committee are scheduled to begin within
ten days. All House leaders have aban-
doned hope OF adjournment before No
vember. although the President has not
formally notified Congress Of the neces-
sity Of a revenue bill.
President Determines Course.
The Administration course was made
plain yesterday. however. after the Sem
ate Republicans failed to agree in ad-
vance to the fundamentals Of tax bill
and to promise TO pass such q measure
at an extra session and before February
I. The proposition put up to the Repub-
licans was that an agreement that so
per cent. OF tho nations expenses shall
be borne by bonds and 40 per cent. by
taxes.
Senator Simmonss letter Of last night
to the President will give Mr.. Wilson an
opportunity to expa in formally why the
Administration insists on a revenue bill
and to express the hope OF nom partisan
consideration.
Senator Simmons said tonight he had
received no reply to his letter. but he Is
Of the opinion the President will reply In
a form which may give the Finance and
Ways and Means Committees the keynote
Of the Administrations idea about tax
bill.
Asked II he still regarded a tax bill
as certainty. Senator Simmons once
more expressed the forlorn hope that a
summer session might be avoided. but
added significantly: II am afraid that
the possibility OF an agreement or ar
rangement putting OF revenue legislation
does not exist"
The position taken by the Republicans
of the Senate Committee on Finance in
opposition to the proposed agreement
with the Democrats fixing a ratio Of 40
per cent. taxation income to 60 per cent.
of loans. was that this should not be
definitely fixed in advance.