The news scimitar. (Memphis, Tenn.) 1907-1926, 1919-12-03
NO REDUCTION IN
TAXES THIS YEAR
DECLARES GLASS

ULULhhLO uLH0O
WASHINGTON, Dec. 3. tspl)-No
appreciable reduction in taxes for the /
next fiscal year is to be thought Of,
Secretary Glass declared in his annual
report sent today to congress. Gov
eminent receipts must be kept at their
Present figure, he said in order to |
bring government borrowing to an end. |
Facing expenditures estimated at So
629, 1885, 59 for the year ending June 80, |
1920, and SAB. 35S for the year end |
ing June 80 1921, the government must |
enforce rigid economy, Mr.. Glass de- |
clared. He placed the deficit for the |
current year at $3,905, 600, 600 and for |
the year ending June 80, 1921, at APP |
proximately 81 005, 900, 000
On this basis. Mr.. Glass urged con- |
gress to deny every appropriation for |
expenditure in new fields" He said |
the same policy should obtain until the |
government had its sinking fund well |
under way and repayment of the war
debt satisfactorily begun"
Mr.. Glass charged that excessive gov
crnment expenditures were the most
vital factors" in increasing the cost of
living and argued that ii was urgently
necessary to keep down public Elk.
penses for this reason as well as be-
cause OF the drain on the taxpayers.
The present revenue laws need reYis-
ing TO meet new conditions, he said, He
referred particularly to the excess prof
its tax laws which he described as being
Objectionable even as wartime eX-
pedient." 1t would be still more OBJ
jectionable in peacetime, he added.
LESS harmful forms" of deriving funds
for the government should be employed,
the secretary said, adding that the eX-
cess profits tax had been responsible
for much Of the increase in living costs
because it had been passed on to the
consumer.
at encourages wasteful expenditures,
puts a premium on overcapitalization
and penalty on brains" the secretary
continued ut discourages new VEN
lures and new enterprises and estab-
fishes old ventures in their monopoles.
In many instances, it acts as a con-
sumption, tax, is added to the cost Of
production upon which profits are fig
ured, determining prices, 1t has been,
and will, so long as it remains on the
statute books, continue to be MAJ
terial factor in the increased cost Of
living"
Redrafting Laws,
In this connection, Mr.. Glass also
urged redrafting of the revenue laws
to prevent the evasion of federal taxes
through the investment of wealth in
the obligations of states and municip-
alties. He said laws should be enacted
which would compel the reporting OF
such incomes, although they are wholly
tax exempt, and that that sum with
other incomes of an individual should
be computed as the basis for assessing
federal taxes on the amount derived
from taxable sources.
Relations between conditions in
Europe and those in the United states
were discussed also by Mr. Glass. He
| SAID that undoubtedly, there was a very
great need in Europe for financial as;
sistance, but that the situation had
been much exaggerated
I'VE must all feel deep sympathy for
Europe today" he said, but we must
not allow our sympathy to warp our
| judgment and, by eXaggerating Euro
pean financial needs, make them more
difficult to fiji. The problem
| Of financing Europe belongs largely to
| the exporter because industries cannot
| be reopened without raw stocks. Gov
eminent financial assistance in the past
and talk of future government or bank
| ing aid to finance exports have ap-
rarently led our Industrial concerns 10
| the erroneous expectation that their
| war profits, based largely on exports,
will continue indefinitely without any
risk on their part. To them will fall
| the profits of exports and upon them
will fall the consequences of failure TO
make the exports"
To Restore Trade.
The treasury will continue its policy,
| in effect since the armistice, TO restore
private initiative and remove govern
| mental control and interference with
respect to the nations foreign trade,
| Mr.. Glass said. Only through this
| means, he argued. could healthy
economic life be gained" He added
| that removal of any influence by the
| errment should provide the IN
| centive for American commerce 70 20
| irto the world markets and establish
| itself. Ratification of the peace treaty
will measurably stimulate export trade,
| Mr.. Glass declared, because operation
| of the pact would eliminate numerous
political risks and provide surer in
| vestment basis.
Closely related to any activities Of
the government in foreign trade is the
subject of Incorporated government
agencies. withdrawal of which Mr..
| Glass strongly urged, He said their
manifest weaknesses were proof sut-
| ficient that such arrangements were not
happv ones for the government nor for
the persons charged with administra-
\ ton Of the corporations. While not say
| ing that any Of the agencies, created
| during the emergencies of war, had
| been guilty Of wastefulness, Mr.. Glass
pointed out that there was no objective
such as business profits to hold expen-
| 01tuTpS GOWN. vi lIlt pllicI MANU- va
ficers managing the agencies operate
on a capital for which there Is no ac-
| compatibility or check and always have
access to more funds If real need ex-
lists. Cases where government funds
| are employed emi-independently Mr..
! Glass declared, largely justified gov
eminent red tape in accounting
Returning to the estimated govern
ment expenditures for the fiscal year
| ending June 90, 1921. Mr. Glass said
! the military establishment would ask
| appropriations aggregating $9S9,57S,657.
| OF this sum, 1897, S92 020 would be re-
| uuired, he said, for maintenance of the
army proper while $50, 100000 would be
| apportoned to the national guard. The
| military academy would receive Sc, 49,
| 637.
For the navy, the appropriation OF
| $542, OBI, SG4, including $lS5.24S,O00 for a
building program is to be asked.
An aggregate of $l94,57S,O00 will be
Sought for public works. In this is in
cllded funds for rivers and harbors'
improvement totalling $5S,659,265. For
tificatjons, arsenals and military posts
| will REQUIRE abort $129,000,0o0.
Legislative Needs.
The legislative establishment will
need $9,025.297, it was estimated, while
| the executive branches OF the govern
nent combined will seek total OF
| $14q, Iii, 1853. Chief among the latter de-
partmental expenditures is an estimate
Of $73, 405, 101 for the treasury depart.
rent This sum which is much larger
| than in former years indicates the add
| ed expense to be borne in the enforce
ment of prohibition. Included in this
also is the appropriation of s37,52S 1902
| to be asked by the department Of agri-
| culture for carrying on its field activi-
| ties