Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1918-08-27
War ReUenue Measure, With One
Exception, Ready to Introduce;
Beverages TO Bear n Heavy Tax
tBy Morning Journal speclaI Lcased Mlrel


Washington, Aug, 2G.-Differences
between the treasury and the house
ways and means committee as to the
levying of a per cent dtfferential or
unearned incomes appeared tonigh
to be the only obstacle to completion
of the drafting Of the revenue bill.
Steps toward an agreement were con-
sidered at a conference between
Chairman Kitchin and Secretary Nc
Adoo Another will be held tomor-
row. Mr.. Kitchin tonight indicated
the committee might not be able to
report the bill before Friday instead
of Thursday as had been planned be-
cause of the temporary disagreement.
Coincident with negotiations start
ed in the senate between prohibition
and anti prohibition leaders to post
pone the effective date of the war
time national prohibition measure,
prosions of the revenue bill dealing
with taxes on Intoxicating liquors
became known.
Would Eliminate Waste.
The session of the committee to-
day was marked by an attempt by
Representative Moore, republican, ol
PENNSYLVANIA, to attach to the bill
an amendment authorizing the APP
polntment of joint congressional
committee TO cooperate with the
president in eliminating waste and
extravaganza in the conduct of the
war. The plan. which would have
authorized a Joint committee of six
members of the senatel and seven
members of the house TOT confer with
the president and heads of depart
ments on all matters relating to war
expenditures reporting to congress,
was rejected by the committee by
a strict party vote,
In the controversy on the unearn-
cd income differential, Secretary
McAdoo has contended that failure
to make the normal taxes as high
as l2 percent on earned incomes and
Is percent on unearned incomes, the
former rate being on incomes de-
rived from labor and personal eXer-
tion, may imperil the success of the
next Liberty Loan. The committee
has fixed the rates at 10 and l3 per-
cent, but it has been stated opinion
is against writing into the bill any
provisions which might endanger the
liberty loans. Both the treasury and
the committee are understood to have
agreed that the differential is not
to apply to incomes below $4,000 or
above $4,000.
Inadmissible Assets.
"The committee discussed provi-
sions regarding inadmissible assets
In the calculation of capital under
the excess profits tax Chairman
Kitchin said az the close of the ses-
sion. "lnadmissible assets included
stocks and bonds other than the
United States obligations from which
incomes and dividends are not used
in computing invested capital,
The bin as tentatively agreed upon
provides that borrowed capital 70
the extent that it is invested in com
monty termed inadmissible assets
may be credited as part or the IN
vested capital. The committee prob
ably will modify this provision to
meet the objection raised in the
committee that it would permit com
panies with large bonded indebted
ness to carry municipal and other
bonds and thus obtain unfair cred
II for an over account of invested
capital
The schedule for the taxation of
beverages proposes that all distilled
spirits, either in bond or produced
or imported, shall be subject to a
tax Of $40 per proof gallon or
per wine gallon If below proof.
Should the distilled spirits be with
drawn for manufacture or produc-
ton the tax would be doubled.
Tax on Imported Perfumes.
On imported perfumes containing
distilled spirits a tax of $3.50 per
wine gallon is proposed. A recti-
fier's tax of thirty cents a proof
gallon is to be levied on beverages,
not including gin, produced by re-
distillation of aromatics.
On distilled spirits produced in
this country or imported and held
for sale when the bill becomes a law,
floor tax of $2.2o is proposed. In
event these spirits are intended for
sale as beverages or beverage man
ufacture the floor tax will be dou-
bled. On articles on which the tax
under the 1917 law has been paid,
and which are held for sale when
the present bill becomes a law, q
floor tax of Is cents gallon is pro-
vided.
The bill proposes a tax OF Sc a
barrel Of 81 gallons on beer, lager
beer, ale, porter and other ferment-
ed liquors. On wines the tax Is six
teen cents a gallon on wines con-
tanning IA percent alcohol; 40 cents
for IA to II percent; 81 for II to
2i percent. and the distilled spirits
tai on wines containing more than