The sun., 1918-09-11
Asks Congress to Fix Ex-
emption During War and
Brief Period Thereafter.
TO PROTECT HOLDERS
Wants Dealings in Issues
on Exchanges Stopped
by Statute.
HE SEEKS LARGER POWERS
Also Calls for Increase of War
Savings Certificates to
Four Billions.
Social D<spafch TO THn suN.


WAsHikoroN, Sept. 1O.--The need of
Immediate legislation of a character af
tecting the whole financial structure of
she United States was urgently pressed
upon Congress Tonight by Secretary
AcAdoo In an identical letter addressed
b Chairman Kitchin (N. c. Of the
HOUSE, Ways and Means Committee
and Chairman Simmons IN. CO. Of the
Senate Finance Committee.
! Almost on the eve of the greatest
LIBERTY Loan drive Mr.. MoAdoo re-
Guested, virtually demanded, that Lib
erty bono. he tax free up to $4,000
during TIE war and for a limited Pc
Rod thereafter; that his own powers
e those OF tho Ministers Of the Elk
cheauers of foreign Powers allied with
ire United States; that the issue OF
War Savings certificates be increased
frac1 $4,000, 100000 to $4,000, 600. 900,
trn chat the $1,000 limitation on per-
g. al holdings of theseScertiacates be
u, ii.
Submits Draft Of . Biil.
accompanying Mr.. McAdoo's letter to
thc chairman was long draft Of bill
q cover the recommendations for new
Hesitation The delay in the passage OF
tie $4,000, O00, 900 revenue bill with the
consequent- feeling of uncertainty makes
4 necessary that this legislation should
b acted upon Immediately, Mr.. McAdoo
pointed out
The Secretary suggested the wisdom
OF working out a plan similar to that
g. Canada, whereby dealing In war Is
s4ns OF bonds on exchanges would oe
e..d-d and the substitution of market
e. them through the banking institu-
tins of the country, acting In close
qneration with the War Finance Cor
ry.ation.
Income from Liberty bond investments
he!d by corporations should also In MI
NcAdoo's opinion be exempt up to $780,
u10 and until he end OF the ca.enhar
yea. following the year IN which the
va ends from the excess profits or war
profits tax.
For aggregate Investments in the
a,s,. second and third Liberty loan
bonds Mr.. McAdoo S-ould have the tax
free exemption as high. AS $4,000. AT
these bonds are free Of the normal TAX
it'would make them entirely free OK tax
~ 10 the amounts specified.
A Complete Surprise.
Mr.. McAdoo's letter came as COM
plete surprise. There had been no III
tfnatlon either at the Capitol or at the
Treasury Department OF the intention OF
TIRE Administration to seek the far
reaching legislation now asked
lis reason for asking that Liberty
tpnds be made tax free to Il certaii'
extent are made clear in his letter.
Principal reason IS that in their sale ~
big investors the Government has u
compete with other Government bonds,
] deral, State and municipal. which are
entirely tax free and are therefore more
attractive.
That the legislation will be granted
o. soon az II can be rushed through the
legislative mill there IN no DOUBT only
tie time necessary for the Ways and
leans Committee and the Senate FL
rance Committee to acQuaint themselves
with the needs set forth by Mr.. McAdoo
and to rush the legislation through both
houses OF Congress Is required. No time
vVl be lost In this, and other matters
viii be s!detracked until 1t is accom-
il;shed. as the legislation must be or
the statute books before the beginning
Of the fourth Liberty Loan drive, Sep
TENDER IS.
Other Recomme ndatiOns.
Mr. McAdoo also made these recon-
foundations In his letter: Al
That he should be authorised to deposit
the proceeds arising from the payment
ot war profits taxes with depositaries In
the United States In the same manner
as the proceeds of income and excess
profits taxes are now deposited witt
qualified banks and trust companies.
That the President should be empow
Continued on Fourth P00e.
THE NATIONAL CITY COMPANY
New Ofnce--5iA Fifth Avenue.
Tho National City Company offeT at n
new ofnce-So. 81 Filth AvepMe.invest