The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1920-12-10
RAISING nation DUCATS
Plan That Is Outlined BY
Secretary Houston
SIZING UP THE FUNDS
Declares That the Country Need
Annual Levy Of Four
Billion
ASSOCIATED Press Dispatch. ]

f..
Washington, December s.-Imme
date revision of the nations tax
laws on the basis of an annual levy
of four billions of dollars for peri
cd OF four years, and including an
on incomes up to 5000, is urged by
Secretary Houston In his annual re
port sent today to congress.
Repeal the excess profits taxes
elimination of certain OF the SO call I
ed luxury taxes, including the levy
on similar beverages, and read
justment of the rates In the higher
groups of income taxes, Is proposed
by the treasury chief. TO meet the
losses brought about by these pro
posed changes, Mr.. Houston rec
ommends revised and new taxes to
yield about $2,ooo,0Qo.ooo, as fol-
A tax of twenty percent on COR
poration profits, distributed or un-
distributed, in addition to applica
ton of higher surtax rate to weld
$500, 000. 900.
An additional tar Of six percent
on corporation incomes to yield
$465, 900 900.
REIMBURSEMENT Of surtax rates on
100000.
Adjustment of the $4,000 exemp-
ton ton OF corporations to yield $685.
000, 900.
An increase fro6 the present four
percent to six percent in the tax on
incomes of $4,000 &op less and from
eight percent to Felve percent in
the tax on incones between $4,000
anu ana St e,so o1 n nea wore estimated 10
A tax Of two ents a gallon on
gasoline for rnoto# cars and all 9th :
er purposes. to Held 10000. 900.
i:otor Car axes.
A federal Hcen8e tax of fifty cents
per horsepower on the use of motor
cars to yield $500, 009, 900.
An additional sales tax on auto
mobiles tother than trucks and wag-
accessories to yield 500, 100000.
theatrical adnissi 81 to yield $40, !
- q = sauss 81
600.
An additional tax Of twenty I'VE
cents per thoueend on cigars 10 yield
SIS 900, 900.
An additional tax of six cents per
pound on tobacco and snuff to yield
5000, 900.
An additional tax of FIVE percent
onicandv to yield $4,000. 900,
An additional tax of. seven percent
on chewing gum to yield S2,000,000
An additional tax of seven percent
on toilet soap and toilet soap pow
ders to yield s4,000,000.
A ten percent 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 vield $10,000,O00.
An additional five percent tax o.,
jewelry and precious metals to yield
$25, ,O0O
An additional tax of five percent or
musical instruments to yield S13,
100000.
An additional tax of five percen,
on motion picture films to yield 81, :
100000.
Would Adjust surtaxes.
In the readjustment of surfaces
Mr.. Houston proposes the division OF
incomes into saved" or reinvested
and spent" On the former class he
would limit the highest tax to TWEEN !
ty percent whole the income spent
would be subjected to a tax ranging
as high as fifty percent. Under the
plan proposed by the secretary, in
comes between $4,000 and $4,000
would he taxed two percent on the
part saved and the same on the part
spent. The same ratio with a grad
uated increase would apply to in
comes up to $4,000 where the max
imum Of twenty percent on saved
income is reached. From $4,000 to
$4,000, the rates would be twenty
percent saved and twenty-fiv per
twenty percent and thirty percent;
$4,000 to $4,000, twenty percent
and thirty five per cent; $4,000 to
100000, twenty percent and forty
percent, and over 100000, twenty
per cent and fifty percent or a total
tax of seventy percent.
The new rates while not laying as
high a levy against the great incomes
will. the secretary expects. produce
greater return to the government
since the wealthy class will not find
it profitable to invest in bonds of
states, countries or municipalities
which are tax exempt, but pay a
lower rate Of interest
Remove Soda Water Tax.
The repeal of the tax on soda foun-
tain and otner beverages is asked, the
secretary says, because the collec-
ton of the tax, the aggregate of which
is small, has presented an admins
trative problem of magnitude. Added
to that, Mr.. Houston says, there has
been constant and widespread evasion
of such taxes.
The excess profits tax, Mr.. Hous-
ton declares, has not fulfilled the
theoretical grounds upon which 1t
was enacted and has been found to
be wrong both In theory and in poll
teal philosophy. He says it discrim-
mated against the conservatively
financed Corporation while aiding
materially the firms whose capitali
zation Is exaggerated. He urges that
1t be replaced by some. form of cor
poration profits tax mot only on the
grounds OF the governments revenue
needs, but upon grounds Of equality
and justice" The corporation profits
the secretary continues, should not
be allowed to escape with a tax oil
ten percent while other taxpayers
are subjected to taxes on their in
comes Ringing as high as seventy
, percent