Pine Bluff daily graphic., 1918-09-27
DIVIDEND TAX
 PROPOSED FOR
 CORPORATIONS
Plan of Senator Norris Would Place Greatest
 Burden on Wealthy.
(N. E. A. Staff Correspondent.)

Washington, D. C., Sept. 26.-Ihe present method of taxing the earn ings of corporations, in the opinion of Senator George w. Norris of Ne braska is all wrong and sooner or later will have to be adjusted so that it will be fair and equitable to the small stockholder.
 After the war is won and there are no more war profits to tax, certainly expect to fight in the Sen ate for action on it" Senator Nor ris declares.
 "Under our war taxation bills we lew on the earnings of corporations. That means that Widow Jones. with few shares of stock, pays the same amount per share as does Millionaire Blank, who owns 100000 shares. The stockholders ARE the corporation. The corporation does not own the earnings. The stockholders do. When you tax the earnings. you do mot tax the corporation, you tax the stockholders.
 |, "Maybe Widow Jones has investetd all the money her husband left her in the stock of a corporation and is dependent upon those dividends for her living. Ordinarily her stock pays her $500 per year But the war tax comes along and as the corporation is taxed to make an extreme case, her dividendes are so cut that her income dwindies to $1560. She is fi- nancially crippled.
 But Millionaire Blank, who has 100 .OO0 shares. also has his income dividends reduced, you say. Yes. He used to get $3,0O0,000.C on his stock and now he gets $2600,000. He is not very seriously crippled. Nor is he when he pays an income tax on what is left.
 Tax Dividends as Income.
 "My idea is that you should not levy tax on the corporation, but the government should add to each mans income what he gets in the way of dividends from the corpora tion and then tax the income. Un- der such law Widow Jones, with her $500 would go untaxed as she should be, and Millionaire Blank would be taxed more-and he should be.
 "The suggestion is thrown hut that maybe to evade such taxes, big corporations would not play divi- dends. They would put the money into the treasury as surplus and some day. when the tax law was re- pealed, cut big melon The sur plus does not belong to the laws fic- tion, the corporation. It belongs to the shareholders, whether they get it now or whether it is held in the corporation treasury for them.
 eff it is held in the treasury as surplus, by look at the stock. books each mans share of that surplus could be figured and it should be ad- ded to his income just as if it had been paid to him in dividends. And then it should be taxed as income. There would be few cases in which money would be thus held. because big shareholders would say if they were to be taxed on it anyway they might as we'll draw the money and enjoy it.
 Opposes War Tax Plan.
 "I am not very keen for the pro- posed alternative tax on corpora tions according to which will yield the most revenue-the excess profits or the war profits. The excess pro- fits tax is full of inequalities and in- justices. As between two companies. with the same capital. it taxes most the one in which brains and energy and modern methods have combined to bring ill greater income It penalizes efficinecy and hustle As between two companies, one with a small capital, based honestly upon the physical value of the plant. and one withaa large watered capital, dis