Evening journal., 1920-04-27
HUGE WAR TAX
IOPAY BONDS.
Democrats and Insuragent
Republicans to Demand
so Per Cent. Levy
WILL PAY BY
INSTALLMENTS

WASHINGTON, April 27.-An eighty !
per cent tax on war PROFITS is the
plan the House Democrats and insur-
gent Republicans, under the leader
ship OF Representative Johnson Is.
d., win insist be passed as the
method OF raising the money neces-
sary TO carry out the soldier bonus
program now being formulated by
the Ways and Means Committee.
Such a measure has been agreed TO
by Representative Rainey ull.) and
Mr.. johnson. II will be introduced
tomorrow with the statement by Mr.
Ralney that it will raise S2O00OOOOO0
The huge levy would affect all ex-
traordinary profits made during the
years i97 1918, 1919 and 1920, and
would be paid in quarterly install
ments, beginning March 49, 1921 For
individuals the tax would be placed
on the dderence between the aver
age net income during the years
named and the year 1911. afler de-
Quoting all taxes paid and eliminating
ali those whose income was less
than $4,000 a year. FOR corporations
the net war income would be COM
pared with the pre-war period of
1911, 1912, 1913 and 1914, with addi-
tional tax on ten per cent. OF the
amount OF capitalization Increases.
Corporations earning less than $780,
600 would be exempt.
The proposal is by far the most
sweeping and drastic OF It's kind made
in Congress during the last few years.
A draft Of the bill reads:
That in addition TO all other
taxes there shall be levied. assess
cd, collected and paid upon the
net income OF every individual
and corporation for the taxable
year 1920 a tax equal to so per
cent. Of the war profits Of such
individual or corporation.
Sec. ?. The tax imposed by sec
ton 1 shall not apply 10 any in
dividual whose average net in
come for the taxable years 1917,
1918, 1919 ad 1920 does not exceed
$4,000 or TO any corporation
whose average net income for the
taxable years 1917 1918, 1919 and
1920 does not exceed S20OO0O.
Sec. 3-ln case OF an individual
the term war profits" means the
amount by which his average net
income for the taxable years
1917, 1918, 1919 and 1920 less his
average income. war profits and
excess profits taxes for such years
exceed his net income for the tax
able year 1914
Sec 4-ln case Of a corporation In
existence during the pre-war
period the term war profits"
means the amount by which It's
average net income for the tax
able years 1917, 1918, 1919 and 1920
less its average income. war
profits and excess profits taxes
for period, plus or minus as the
case may be, 10 per cent Of the
difference between It's average in
vested capital FOR the pre-War
period and It's average invested
capital for the taxable years 1917,
1918. 1919 and 1920.
Sec. SIN the case Of a corpora
ton not In existence during the
whole OF any one year during the
pre-war period, The term war
profits" means the amount by
which It's average net income for
The taxable years 1871 1918, 1919
and 1920 less Ms average income,
war profits and excess profits
taxes FOR such years exceed 40 per
cent. Of its average invested cap
ital for the taxable years 1917,
1918. 1919 and 1920.
Sec. 6-The tax imposed by this
act shall be returned. assessed,
collected and paid upon the same
basis. In the same manner and
subject TO the same provisions OF
law. including penalties, as the
taxes imposed by titles ? and 3 Of
the revenue act OF 1918. at the
same time as therein provided for
the return and payment OF in
come taxes for the taxable year.
Sec. THE Commissioner Of
Internal Revenue may grant a rea-
sonable extension Of time for the
payment Of the tax imposed by this
act whenever, in his Judgment
good cause exists, and he shall
keep a record OF every such ex-
tension and the reason therefor In
case an extension OF time is grant
I'd the taxpayer snail pay In ad-
dillon TO the tax due Interest at
the rate of One-half per cent. per
month on the amount OF each in
eiallment not paid from the time
the lnstalment was due.
The term corporation" II Is pro
vided in Section s. includes assocla.
tions. Joint stock companies and IN
surance companies. The. Term TAX
able year" means the calendar year
or the fiscal year ending during suc
calendar year upon the basis o
which the net income is computed
THE term Fiscal year" means an &C
counting period Of twelve month";
ending on the last day OF any montl
other than December.
The term ,"pre-war" period mean
the calendar years 1911, 1912, 1918 an'
1911. or II a corporation was not u
existence during the whole Of sucl
period, then as many OF such year
during the whole OF which The cor
roration was in existence. The tern
anet income" OF a corporation for tn
calendar years 1911, 1912 and i9i;
and The average net Increase for IN
pre-war period is 10 be determined 4