New-York tribune., 1918-09-18
Levy ON Future Liberty
Bonds To Be IL Instead
of 18 Per Cent
War Excess Profits
Will Come Up To-day
Kitchin Expresses Hope
Bill Will Be Passed Not
Later Than Saturday

WASHINGTON, Sept II. - Income
tax provisions of the new revenue law
affecting both individuals and corpora
tlons and designed to raise S2,376,OOO,-
600 of the measures eight billion total
were approved to-day by the House
NO changes were made in the rate pro-
posed by the Ways and Means Commit
tee, and with consideration of the IN
come tax eections virtually conclude d
the House tomorrow will take up the
war excess profits provisions, estimated d
TO yield $3,2O0,000, 900.
Two important notifications in the
income tax sections were made by the
House at the request OF the Ways and
Means Committee. Liberty Bonds of
future issues shall be subject to the
reduced income tax rate Of 12 per cent
instead Of the normal 18 per cent rate.
Another permits corporations and in
dividuals in calculating their income to
deduct all interest paid or accrued. A
provision limiting such deductions to
the excess of interest received free as
on Liberty Bonds was eliminated
Many Amendments Rejected
During the days debate, in which
Majority Leader Kitchin took steps to
expedite the bills disposal, expressing
hope for its passage not later than
next Saturday, many amendments not
approved by the Ways and Means Com
mittee were rejected. At the outset
the House defeated, 1872 to 61. the
amendment by Representative Mon
tague, Of Virginia, Democrat. to eX-
empt future issues of state, county
and municipal bonds from Federal in
come taxation. kilograms of protest
against this section OF the bill sent by
many mayors and other local officials
to Representatives arrived after the
House had acted.
Efforts to extend to corporations and
partnerships the Is per cent allowance
given individuals for contributions to
charity were defeated after livelv dis
cusslon. Several members urged that
corporations and partnerships should
IN all fairness be given the same priv
ilege as individuals for donations to
the Red Cross, the Y. NJ. c. A. and
other organizations engaged in war
welfare work.
Representative Hull, of Tennessee
Democrat, and Representative Stafford
OF Wisconsin, Republican, led the fight
against the corporate and partnership
allo"ance, declaring war charities are
an !ndlvldual and not corporate obli-
gatlon and that premium or rebate
should not be provided for such do.
nations which might cause diversion
OF corporate funds and loss Of revenue
to the government.
Less Than British Tax
In approving the corporation income
tax sections Representative Longworth
OF Ohio, Republican, said the 18 per
cent tax proposed three times the
present rates-is less than the 20 nor
cent British tax. The per cent re-
duction given for distribution of prof
It's Mr. Longworth added is not pen
atty for failure to distribute but an
incentive TO declare dividends and turn
funds into the hands of individuals
who're the income surtax rates will
provide revenue for the government.
The per cent rate he said was re-
garded by the committee as treason
able encouragement" too, and the 18
per cent maximum rate not hardship
on corporations.
Representative McKeown Of Okla
homa, Democrat, offered, but the House
promptly rejected, an amendment to
have the lower rate apply to funds held
and ACTUALLY needed' by a corporation.
PROVISIONS of the bill for allowances
TO OIL and gas operators and miners for
depletion OF their properties were tenn
porarily passed over.