Weekly journal-miner., 1919-07-23

D. E. Parks in a communication to the Journal-Miner published on May
 2, last, the Chamber of Commerce sought to secure from Arizona S congressional delegation, some light
 on the method of taxing sales of min ing property, the stand being that
 profits from increased properties were
 not income. That the internal rev
 enue bureau holds so, however, is in-
 dicated in letters just received from
 Congressman Carl Hayden and Com-
 missioner Daniel G. Roper of the
 bureau, which are published here
 with:
 j MT. Hayden says:
 | "On receipt of your letter of June
 18th I transmitted it to the commits
 sioner of internal revenue, asking to
 be advised as to the regulations of
 the treasury department with respect
 to the taxation of money received
 from the sale of mines. 1 enclose
 herewith reply that I have just re- ceived from Mir. Roper discussing
 this question in considerable detail.
 He points out that the surtax on the
 profits made from the sale of min eral land is limited to 20 per centum of the selling price, in case where pre- viously undeveloped claims are made valuable by exploratoin work This fact was not mentioned in the news paper clippings that you sent me.
 "I am convinced that by reason of
 the great risks incident to mining that the mining industry cannot prosper unless there is also an oc- casional opportunity for considerable profits and for that reason I believe that 1t would be better for the coun- try as a whole if the income tax laws were amended as you have suggested. Unfortunately the government is badly in need of money in order to pay of the obligations occasioned byi the war, so that I can hold but little hope for a reduction in this or any other tax in the immediate future
 Mir. Roper's letter is as follows:
 "I am in receipt of your letter of June %, 1919, transmitting com munication from the secretary of the avapai County Chamber of Com mercc and clippings from the Jour nal-Miner in regard to the regula- tions of the department with respect to the tax on profit received from the | sale of mines
 The clippings are to the effect that the construction of the income tax law holding that the gain rcceiv- ed from the sale of mining property should be reported as income, is pro- voking wide discussion and evinced | loud protest. In the opinion of the author of the clippings the apprecia- i tion in the value of any real estate which occurs from no action or in tent Of the owner in suing and work ! ing upon it for the means of self support is simply a part of it, and | the capital invested in is not inde- | pendent of it; is inseparable from it, and being so cannot be income, as income must, of necessity, be inde- pendent of the capital producing it.' It IS also stated that the monies re- ceived over and above the cost were never intended by the lawmakers to be held as income under the law.
 "In reply you are advised that the question has been given careful con sideration by this office but in view of the express provisions of the law no change can be made in the ruling that gain derived from the sale of mining property is subject to income tax
 "The law provides that the term . OSS lllOOlllC luOlultS SdulS, pIOulS, and income derived from salaries, wages, or compensation for personal service of whatever kind, and in whatever form paid, or from professions, vacations, trades, busi- nesses commerce, or sales or deal 1 ngs in property, whether real or personal, growing out of the owner snip or use of or interest in such also from interest, rent, dividends, securities, or the transac- ton of any business carried on for gain or profit, or gains or profits and Income derived from any sources whatever. The amount of all such 1 tens shall be included in the gross ncomc from the taxable year in which received by the taxpayer, un- ess, under methods of accounting permitted under subdivision (b) ot ', section PIP, any such amounts are f o be properly accounted for as of a V lifferent period; but *' Il
 Under this provision gains from V