The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1918-07-27
REVENUE PLAN
IN final. FORM
DECIDED UPON
Excess Profits Tax From 30
to 80 Percent on Net In
comes.

WASHINGTON, July 27.-Thc grad
uated excess profits tax of from 30
to 80 per cent on net income beyond
exemptions practically was adopted
Friday in final form by the House
ways and means committee. thereby
ratifying the tentative agreement
reached Thursday The committee
also decided upon the same specific
exemption Of $4,000, plus 10 per cent
on the amount Of invested capital, as
tentatively decided yesterday. Ad-
journment was taken by the commit
tees until Monday, when taxation OF
lJxuries, estimated by the treasury as
capable Of raising $4,000. 100000 will
be considered.
Complaints Of inequalities to the
treasury and to the committee are ex-
pected to be remedied by the commit
tees action today in repeating sec
ton of the present revenue law. The
effect will be that the excess profits
tax under the pending bill will not ap-
ply to individuals and partnerships,
but only to corporations. Individuals
and partnerships are amply reached
through the normal and surtax pro-
visions of the income tax law.
The committee decided to retain
substantially the same text Of "capi-
tai invested" and other definitions as
are in the present law.
Not Above 60 Per Cent.
While not definitely deciding the
matter a majority Of the committee
was favorable to provision that in no
case should the excess profits tax ex-
coed so per cent of the net income nor
be less than 10 per cent Of the net
income in the case OF corporations
with capital exceeding 100000.
Common carriers and public utility
corporations whose rates are subject
to regulations by Federal state or
municipal government, were excepted
from the 10 per cent minimum, be-
cause the committee regarded such
rates as already regulated to low in
come basis.
Treasury experts reported that the
excess profits plan adopted would pro-
duce approximately $500,000,000 more
revenue than derived from the same
sources under the present law Com
putations were submitted showing that
IL the revenue from excess profits un-
der the present law yields $1,200,O0O,-
900, it would raise under the proposed
plan $1,000, 100000, or If the present
law raises only s1.000,0000 900 from ex-
cess profits, considered by some Of the
committee members as more nearly
correct, the revenue under the pro-
posed plan would be correspondingly
less,
Flat Tax Considered.
Several members of the committee
were disposed TO favor a fat tax Of 80
finally adopted plan. but the commit
tee rejected the proposal as one that
would discourage initiative in industry
and business.
The committee disregarded altogeth-
er all pre-war comparisons for taxa
ton. There is still discrepancy Of
almost $4,000, 100000 between the rev.
enue estimated 10 be yielded by the
excess profits and income taxes, as
proposed, and the $4,000 900 900 sought
from those sources under the $4,000
100000 revenue program on which the
committee is working So far. how
ever, no new source of tax has been
considered, but new taxable sources
may be found when luxuries are con-
sidered. Treasury experts have ad-
vised the committee that by doubling
the present tax on liquors, tobacco,
soft drinks, admissions to amusements,
transportation, club dues and excise
tax On such articles as automobiles
and perfumes, the present revenue
from those sources of 1861 10000 can
be doubled