The Daily Ardmoreite. [volume] (Ardmore, Okla.) 1893-current, 1918-10-20
The Tax on Oil.

Tulsa World: X. W. Hart of the Grant
Stebbins organization, who has been in
Washington for six weeks in the inter
est of the oil producers tax legislation
says that nothing has SO thoroughly
awakened the country's Legislators To
the need of encouraging oil production
as the gasless sundays. when not an
automobile is TO be seen high or low
The bill as it passed the lower house
is fairly satisfactory, according to Mr.
Hart with the exception of the defini-
ton of invested capital"
As passed, Section 326 reads as fol
lows: ta) That as used in this title the
term invested capital" means lexcept
as provided in subdivisions (bI and (cD
of this sectionD:
~ Acautl cash bona fde paid in for
stock or shares:
(2l Acautl cash value of tangible
property, other than cash bona fide
paid in for stock or shares at the time
of such payment (but in no case to ex-
ceed the par value of the original stock
or shares specifically issued therefor)
This clause should be amended ac-
cording to Mr., Hart, by striking out the
phrase but in no case to exceed the par
value of the original stock or shares
specifically issued therefor"
Article 90 read as follows.
Paid in or earned surplus and un. |
divided profits, not including surplus
and undivided profits earned during the |
taxable year and not including the in. |
crease in the value of any asset above |
ihe original cost until such increase
is actually realized by sale.
70 which article, according to Mr.
Hart should be added. or in case Of
Oh wells, gas wells. mineral deposits or
umber charged to a special invest
men; account and credited to paid IN
surplus on the books of the CORPORA.
ion. such increased values to be de.
ermineG under rules and regulations 70
"r prescribed by the commissioner of
! lhl0 rhaI revenue with the approval of
the secretary Of the treasury. but in
no case TO exceed the correct fair mar
ket value Of the property.
PROVIDED further that such increased
values If any, shall be depleted in this
same manenr and at the same ratio
as the actual cost Of the property"
Many corporations," said Mr. Hart
viii be unjustly burdened if denied the
privilege Of taking Up on their books
legitimate appreciation on tangible
property and Of taking such apprecia
ION INTO account in computing invested
'apital. II does not follow that such
appreciation should also be taken into /
onslderation in computing income
IN computing income from profits
N sales OF capital assets. such appre.
iauon should be disregarded. and the III
ost price OF such assets should be the III
air market value. as OF March 1919 III
acquired prior to that date. and No. III
IA! cost If acquired subsequent 10 \,
hen. Y
The government undertakes to alIow
all corporations certain deductions -
men are to be based on the actual .
HOuht oI capital invested in business.
mere can be no getting away from
ie proposition that the current value i
a tangible property is the actual
'pItaI invested in same Unquestion-
'iy' All corporations should be granted
as deduction. which is based on capital
vested on an equitable basis.
Inc majority of corporations win be
anted this deduction as a matter of
purse. The exceptional CORPORATION
ould be. and can be in the manner
ated above, put on the same basis as
q majority corporation.
"In gr aoualizatioo IN l
sted capital. LIE government does not
rrender any income taxing right.
le increased earning power of such
preciated property is Immediately
ailable for purposes of taxation. and 4
OF the earnings OF such property /
II be available for taxation purposes
fast as realized.
7 AXE the case of a corporation nro.