The sun., 1918-12-18
PASS REVENUE BILL
NOW, PBNROSE ASKS
Senator Fears Defeat Would
Mean Heavy Tax on War
Profits.
LA TOILETTE TO FIGHT
Wisconsin Man Has Support
Of Small Group Of OBJ
structiOnists.
Epeeisi Desposeh to TIE suv.


WASHINGTON, Dec. 17.--Senator Pen
rose (Pa-). senior Republican member
Of the Finance Committee, to-day
urged on the Senate the early passage
Of the pending revenue act, warning
that In the event Of Its defeat provision
might be made before adjournment OF
the present Congress for increasing
revenues through an amendment Of
the existing law as to war profits.
There was a fatal difficulty in this
suggestion. he said, that very valuable
relief provisions Of the pending bill
would be lost"
This suggestion Of carly action was
reechoed by Chairman Simmons. who
told the Senate that he was very
hopeful In view of the general attitude
Of the minority toward the bill and in
view of the fact that the majority and
minority are in practical accord as to
the necessity for prompt action. that
the revenue bill might go to conference
with the beginning OF the new year.
having passed the Senate during what
In normal times would have been the
holiday recess.
La Toilette Stumbling Block.
Senator La Toilette (wis.), in ule
course OF the reading Of the bill to-day
informed the Senate repeatedly that
he would move to amend items in the
income tax provisions, but asked that
for the present they be passed without
prejudice for future consideration.
Senator La Toilette, at the head Of
a small group. offers the one compile
cation to the practical unanimity
existing between the Democrats and
Republicans favoring the early pas
sage Of the revenue bill. With the
Wisconsin Senator stand about a
dozen Republicans and four or five
Democrats, who will criticize the bill
as at present framed. urging reduc-
ton in the number of titles and a
higher rate of wealth conscription.
Senator Penrose earnestly warned
against the tendency to drive taxes
to an altitude whereby stagnation Of
industry and halt OF the natural ex-
pansion OF American enterprise might
| result. He pointed out that in the
| course of the last few years and
practically since the beginning OF the
war only America has felt real pres
| sure from a system OF direct taxation.
Direct Taxation an Experiment..
Direct taxation Is comparatively
new in the United States." said Sena-
| tor Penrose. Until within the last
few years. whatever fiscal policy may
have prevailed In the country, the bulk
of the revenue was raised from the
| custom house and by certain recog-
nized and established internal revenue
taxes. chiefly on liquor and tobacco.
Later on in 1909 the revenues were
| supplemented by excise taxes. followed
by a small income tax in 1918. It
was only IN 1915 and 1917. however,
that the Government of the United
States undertook to raise by direct
taxes--I mean taxes upon income, per-
sonal and corporate--any great por-
ton OF Its revenue.
Our experience with this system OF
taxation Is therefore brief Some as
sistance In solving the intricate prob
lens which such a system involves IL
TO be derived from England. where
!tcome taxes have been long estab-
lished. No country. however, has ex-
perienced the repressive effect OF rates
as high as those IN this bill.
| NO European country has to meet
in this field the same problems which
arise in the United States. In Eng
land. for example, industries are
mainly old and established. Hero a
large part of our essential production