The Washington herald., 1918-07-20
REVENUE BILL
TOLEVY MORE
INCOME TAXES
Exemption Is Lowered and
Corporation Payments to
Be Doubled, Is Plan.

An increase OF Ine uOTmdI IuCOtuc
tax rate on all personal incomes
from per cent to 10 per cent may
be determined upon by the Ways
and Means Committee. which Is now
drafting the $4,000. 100000 revenpe
bill. The corporation tax, now. s
per cent may be increased to IL
per cent.
In addition to these increases, 1t
may become necessary to reduce
the exemption, Of $500 now allow
ed single men to $3.50 and that Of
the men of family from $4,000 to
81, 500.
The changes were discussed by
the committee yesterday when 1t
resumed its work on the bill. No
decisions were reached. but the
general opinion prevailed among
the committeeman present that the
alterations in the rate and exemp-
tions would have to be made in or
der to provide the amount of
revenue which must be raised from
this source.
Were Gloomy.
Even with these increases made, the
committee INDUCED in an exchange
of gloomy forecasts as. to the possi-
biIity Of raising 1000 10000 by means
of taxes on personal incomes and
excess profits. Actual figures and es-
Inmates of the amounts that may be
raised from these two sources are
yet to come from the Treasury De-
partment. But the statements in the
hands of the committee tended, to
show that the revenue to be derived
fhaFafrnr1, xKrfH fan - - ac
Ooo, 600 mark by probably 81, 900, ,0o0,- :
coo.
The committee agreed at the begin
ming of its sessions that the $780,
10000 required by Secretary McAdoo's
estimate would be divided so that
S6.O00O00,eo0 should come from excess
profits and income taxes. while the
remaining 5000, 10000 would be OBJ
tained from all the other sources of
taxation available for the purpose.
The committees discussion yester-
day showed that 1t may be neces-
sary to revise these calculations, that
not more than 5000, 10000 may be
raised from excess profits and in
comes, and that the additional 81. .ooo,-
100000 will have to be raised by con-
sumption taxes and taxes on So
called luxuries- The committee has
hesitated to go to consumption taxes
for any Of the much-needed revenue,
but if the calculations made yester-
day are sustained this may be neces-
sary.
Suggest Higher Cotton Tax.
Several Of the Republicans on the
committee suggested a higher tax on
cotton, but this met with scant en-
thusiasm from the majority members.
Representative Longworth. of Ohio,
said that il $S.000,OO0,O00 is insisted
upon as the minimum amount to be
raised by the bill, a tax on cotton
Will be necessary. The Republicans
have no hope of being able to per-
suade the majority members to agree
to raise the import duties now inn
posed by the Underwood tariff law.
The effect of national prohibition
upon the revenue situation was also
literally discussed. Members of the
committee, without regard 20 their
personal views on the prohibition
issue, viewed with alarm the prospect
of being shut off from the revenues
now derived through the medium of
liquor taxes. Some of the members
or the committee took the radical
position that, II Congress should pass
the prohibition measure now before
the Senate. the committee should call
upon President Wilson to vote il in
order to help swell the revenues.
Dry Law to Cut Revenue.
Regardless of whether nation
wide prohibition becomes an act
uality or not. the committee is pro-
ceeding on the assumption that
liquors of all kind will help bear
the wars burdens. and the new
bill, in all likelihood, will double
the present taxes on whiskey, beers
and wine. which now produce some
thing over 100000. 900 in revenue
If the bill should be reported be-
fore the Senate acts on the prohibi-
ton measure. it would be putting
1t up to the President pretty hard.
either to head Off the amendment
or TO promise TO vote it II PASSED.
otherwise, the revenue bill would
have to be redrafted, and the COM
mittee would have to dig deener into
luXuries and other sources to make
up the deficit.
Some Incomes Reduced.
Another phase of the revenue s;tua-
tion which caused some discussio,, ar
the committee meeting was tho
shrlnkase in personal and corporate
incomes, due to a number Of causes
Ihe Treasury estimate is that incomes
OF all sorts for the taxable year lust
closed will amount to about 81. COO
OOo'0VO. But this is believed to be the
nigh water mark, and nothing like
that amount is looked for in the wear
ending June 90, 1919. In EXPLANATION
OF this, the committee has been in
formed. incomes of individuals and
corporations alike have fallen off very
percepdbly. Price fixing Of yarious
products Is one cause of this: in
creased cost of labor and materials is
another
The committee Is, awaiting the data
on -profiteering which is to come from
the Treasury Department. 1t is OK
pected to be ready within a week.
cRTJTSER'S SINKING