The Chattanooga news. [volume] (Chattanooga, Tenn.) 1891-1939, 1920-12-08
For Four YearS-InCIudeS In
crease of z Per Cent. on
Incomes Up to $4,000.
WOULD LIFT TAX ON SODAS
Secy. of Treasury Proposes
Repeal Excess Profits Tax
and Offers Substitute.

Washington, Dec. S.--Immediate re-
vision of the nations tax laws on the
basis of an annual levy of $4,000, 00G 900
for u period of four years, and inciud-
ing an increase of per cent in the
taxes on incomes up to $4,000, Is urged
by Secretary Houston In his annual re-
pos sent today to congress.
Repeal OF the excess profits taxes,
elimination OF certain OF the so-called
luxury taxes. including the levy on
soda fountain and similar beverages,
and a reimbursement OF the rates In the
higher groups of income taxes, is pro-
posed changes, MIR, Houston recon-
the losses brought about by these pro-
posed changes. Mr.. Houston decom-
mends revised and new taxes to yield
about $4,000, 100000 MS follows:
A tax of 20 per cent. on corporation
profits, distributed or undistrbuted, in
addition to application of a higher sur
tax rate to yield $500, 100000.
An addition tax of per cent. on
corporation incomes to yield $465, 000.-
900.
Readjustment Of surtax rates on In
comes to yield an additional $3.50, 600, 900.
Adjustment of the 50 900 exemption
allowed corporations on income to yield
$5S. 900.
An increase from the present per
cent to 6 per cent in the tax on in
comes of $4,000, or less and from per
cent. to ~ per cent, in the tax on in
comes between $4,000 and 100000, the
whole estimated to yield $l5O.94O, 900 an
nually,
At tax OF 2 cents a gallon on gasoline
for motor cars anu all other purposes.
to yield SOC, 600, 900.
A federal license tax OF so cents per
horsepower on the use of motor cars,
to yield $l00.000,0O0.
An additional sales tax on automo-
In
and motorcycles and motor car Access
sories. to yield $i00,000,0O0
A 10 per cent. additional tax on the
atrical admissions to yield $70,000,0O0.
An additional tax OF SO per thousand
on cigarettes to yield 7O,000000.
An additional tax OF 25 per cent. per
thousand on cigars to yield $4,000 00
An additional tax of 6 cents per pound
on tobacco and snuff to Yield $4,000. 900.
An additional tax of per cent. on
candy to yield $20,000,000.
An additional tax of per cent. on
toilet soap and toilet soap powders to
yield $4,000 900
A 10 per cent tax on the sale by
manufacturers, producers or importers
of perfumes, cosmetics and medicinal
articles In lieu of the present tax on
the consumer, to yield $lO,000,00O.
An additional s per cent. tax on jew
elry and precious metals to yield $685.
900 900.
An additional tax of per cent. on
musical instruments to yield 10000, 900.
An additional tax Of B per cent. on
motion picture films to yield $4,000, 900.
81, "saved" and "spent."
In the roadjustment of surfaces Mr..
Houston proposes tho division of in
comes into saved or rcinvosted and
spent" On tho former class he would
limit the highest tax to 20 per cent,
while the income spent would be sub
Jccted to a tax ranging rs high as so
per cent. Under the plan proposed by
the secretary, incomes between $4,000
and $4,000 would be taxed 2 per cent.
on the part saved and the same on the
part spent. The same ratio with a
graduated increase would apply to In
comes up to $4,000, where the maxi
mum of 20 per cent. on saved income Is
reached, From $4,000 to $4,000, the
rates would be 20 per cent on saved
and rs per cent. on spent $4,000 to $780,
Oo0' 20 per cent, and 80 per cent. $780,
600 TO $4,000, 20 per cent, and So per
cent; $4,000 to 100000, 90 per cent.
and 10 per cent, and over 100000, 20
per cent, and so per cent, or Il total
tax of 10 per cent,
The present maximum rate is 40 J "
cent, ON incomes OF 81 ,OOO, 900, but MIR
Houston declares Il has long pasged
the point of It's minimum produclN.
ity," since 1t encourages the invest
nent in taX-exempt securities, lic
SAYS the 'only effective way TO tax
the rich Is to adopt rates tina: do not
force investment In taN.eNempt Sc
curitics"
The now rates. while not laying as
high a levy against the great incomes
VIII, the secretary expects, produce u
greater return to the government,
since the wealthy class win not find
II profitable TO invest In bonds OF
A IAN ~ ~ fARl tisAN
which arc tax exempt but pay II
lower rate of. interest,
"Those possible sources OF income
are mentioned for the information Of
congress-" MIR, Houston says while
| shall not attempt to discuss thom
attention should I've called TO the new
and additional consumption taxes
Reasons have been given for the hd-
lief that no valid objection exists TO
the employment of moderate NUM-
her of consumption taxes properly Sc
looted hut 1t would, in my opinion,
he neither wise nor cNpodiont to In
crease radically the volume of cons
sumption taxes. . The articles
Included In the suggested Hist of nd.
ditioual consumption taxes have not
been selected because their Use Is par
ticularly harmful or in any sense le-
gtttmatc than those not included,
Consumption taxes must I've Judged by
practical standards What should be
| sought are a few consumption taxes
which tap the surplus income Witch
! Is being wasted not conElomeratc
multiplication OF petty taxes upon
! every article of luxurious or unnect".
| sarN cousumpton which can neither
! hc clearly defined. chcaply collected
! nor administered without widespread
~ Constantly Evadcd.
| The repeal OF the tax ON soda fouu.
q . la, a