The Birmingham age-herald., 1918-08-27
Kitchin and McAdOo Confer, But Fail to Agree on 3 Per Cent Differential Tax
 on Unearned Incomes
PROVISIONS OF BILL DEALING WITH LIQUOR TAXES MADE KNOWN
Failure to Put 15 Per Cent Tax on Unearned Incomes and 12 Per Cent on Earned Incomes Would
 Threaten Success of the Next
 Liberty Loan, Says McAdoo

Washington, August 26. Differences between the treas ury and the House ways and means committee as to the leyying of a 3 per cent differen- tial on unearned incomes ap- peared tonight to be the only obstacle to completion of the drafting of the revenue bill de- signed to raise $9,O0O,00 900 by taxation in the present ifs cal year. Steps toward bring ing about an agreement be- tween the committee and the treasury were considered at a conference today between Chairman Kitchin and Secre- tary McAdoo. Another con ference will be held tomorrow. Because of the temporary dis agreement, MT. Kitchin tonight indicated that the committee might not be able to report the bill to the House before Friday, instead of Thursday as had been planned.
 Coincident with negotiations started .n the Senate between prohibition and anti prohibition leaders to postpone the sf fect!ve date of the wartime national prohibition measure to be taken up soon. provisions of the revenue bill dealing with taxes on- intoxicating liquors be- came known
 Sessions ot the committee today were marked by an attempt by Representa- tive Moore. republican, of Pennsylvania, to attach to the bill an amendment au thorizirg g the appointment of joint cen gresaonal committee to CO., operate with the President in eliminating waste and extravaganza in the conduct of the war. The man. which would have authorized a
 
 senate and seven members of the House to confer with the President and heads of departments on all matters relating to Wal expenditures reporting to Coo gress was rejected by the committee by strict party vote.
 LOAN SUCCESS IMPERILED
 In the controversy on the unearned in come cifferertial. Secretary McAdoo has contenied that failure to make the nor iSial taxes as high as F per cent on earned incomes and Is per cent on un- earned incomes, the former rate being on incomes derived from labor and personal eyertion. may imperil the success of the next liberty Loan. The committee has fixed the rates at 10 and 13 per cent. out 1t has been stated opinion is against writing into the bill any provisions which might endanger the Liberty Loan. Bot.l the treasury and the committee are un- derstood to have agreed mat the differen- tial is not to apply to incomes below s4c0o or above $24,Ooo
 The committee discussed a number of things to-day, including provision re- 6<SA uAA6 iH1NifsASSoosc doSclb III ttIc SdA~t lation of capital under the excess profits ta1." Chairman Kitchin said at the close of the session. 'Inadmissable assets in- clude stocks and bonds other than United States obligations from which incoEse and dividends are no, used in comput ing invested capital"
 The hhl as tentatively agreed upon L-ovides that borrowed capital to the ss< ten. that it lis invested in commonly termed jnadmissable assets may ne credited as part of the invested eapraL The committee probably will modify this provision to meet the objection raised m the committee that it would permit con- ran'es witk large bonded indebtedness to carry municipal and other bonds slno th.ss obtain fair credit for an os sr- a.nount of invested capital.
 BEVERAGE TAXATION
 The schedule for the taxation of bsv, c,ages p, opposes that all distilled spi,ita. either in bond or produced or impor.~d. shall bel ubjett to tax of $40 per proof gallon or per wine gallon, if below prONt. Should the distilled spirits be withdrawh for manufacture or production the tax would be doubled.
 On imported perfumes containing distilled spirits. a tax of $3.s0 per wine gallon is proposed A rectifier's tax of 30 cents a proof gallon Is to be levied on beverages not including gin, produced by redistillation of Anomalies. I r On distilled spirits produced in this