The Washington herald., 1919-02-23
VICTORY LOAN"
ACT TO RAISE
SEVEN BILLIONS
Short-Term Notes to Be
Substituted for 26-Year
Bonds.
PUT In FOUR CLASSES
Bill, Reported to House,
May Be Adopted Late
Tuesday.
PUT IN FOUR CLASSES

The Victory Liberty Loan act. au-
thorizing the issuance of 5000, 10000
in short-term notes instead of tie
proposed twenty-year victory bonds
was reported to the House yesterday
by Chairman Kitchin. OF the Ways
and Means Committee. 1t will oe
called up for consideration Immediate
Iv after the passage of the sundTy
civil bill, probably late Tuesday.
Chairman Kitchin believes he will be
able to get the measure through the
House in time for the Senate to pass
it before the present Congress expires,
March T. If the bond legislation Is
not passed. Mr.. Kitchin said. an extra
session must be called before April l,
as the condition of the Treasury is
such that it must have authority to
raise additional funds by that date.
In addition to providing for four
classes of notes which the Secretary
of the Treasury may issue in his dis
cretiOn. the bill carries several other
important features. Among them are:
-Four Glasses of Notes.
/. Continuation of the War Finance
Corporation. with fund of 1,6o,0ot
GO to finance the foreign commerce of
the country during the reconstruction
period by making loans to American
exporters.
.. Sterilization of values of previous
liberty bond issues by increasing the
tax exemptions for a period of five
years.
;. Authorization of peace time loaG;s
to foreign governments to enable the
United States to dispose of its equfP-
ment sent abroad for war purposes.
I. Creation of a sinking fund for the
retirement of all war bonds.
The proposed Legislation fixes the
tax exemptions on the shoTt-time
notes but gives the Secretary of the
Treasury power to fix the interest
rates within his discretion. The bill
also provides that the notes may be
redeemed, at the option of the Govern
ment, upon not more than one years
and not less than four months /
notice.
The Secreary of the Treasury is
authorized to issue any one or more
OF the four classes of notes, the date
OF maturity to be fixed by the Secre- /
tary. within the limits of from one to /
five years.
Exemptions are Fixed.
The exemptions as fixed in the bill
Tor the four classes of notes follows:
l. Exempt. both as to principal
and interest, from all taxation, ex-
cept estate or inheritance taxes. now
or hereafter imposed by any taxing
authority.
= Exempt, both as to principal and
interest from all taxation now or
hereafter imposed by any taxing au-
thority, except estate or inheritence
taxes and graduated additional income
taxes, commonly known as sur
taxes and excess profits and war
profits taxes now or hereafter i'm
posed by the United States upon the
income or profits of individuals, part
nerships, associations or corporations d
) Exempt, both as to principal and
interest from all taxation now or
hereafter imposed by any taxing au-
thOrity, except estate and inheritance
taxes, and with an additional ex-
cmption of the interest on notes I'd to
10000 owned by any Individual,
partnership, association or CORPORA
ton from surtaXes. excess-profts and
war-prof1ts taxes.
T. Exempt, both as to principal and
interest from all taxation now or
hereafter imposed by anv taxing
authority. except estate and fnber-
itance taxes and all income. excess
prOhts and war-profts taxes