New-York tribune., 1920-05-05
poposed u. S. Tax
Menaces Trading,
Reu1ick Declares
|e.cId Destroy Incentive
nd "Produce CONNER
.;al insolvency." HE Says;
M.rv Plan to Meet Here

:, qualification OF his telegram sent
:. Monday inviting the presidents Of
.,,.k and commodity exchanges OF
: ,oantry to meet In this city FIJI
= FAR the purpose Of evolving plans
.anosi,ion to the proposed Federal
m :. transfers Of securities, William
: s.miek, president of the New York
- rxehsnge, in q statement yester-
w. w. declared that such legislation
Es"la tend to produce commercial in
..n.,ey. industrial stagnation and a
a '..;ou, impairment Of the credit Of
!. government itself"
The proposed legislation being con-
.;,.,sd by the House Ways and Means
rnnn,,.ee provides for tax on Sc
VS.s.r,' ss;.r transfers of 2 cents on each $40
US ss.s value or fraction thereof in
u, os the present transfer tax of 2
...,s ..s ' an each $l0o of par value or
s..s;on thereof. 1t is proposed that
A,l;s ,sy be imposed for the two years
~. =, december 1, 1920, 80 November
= ,,'', ,aca after which date the present
-. ,,.e may be restored. In other words,
i. s nresent transfer tax Of 81 on the
..i. of 100 shares OF stock would be
,sis ,sised for a period Of two years. A
.s-,;lsr increase is recommended in the
,.s"sfsr ,.,. tax on sales Of produce on an
sATa Tns stfeet Of the bill as now evolved,
....rdinx TO Wall Street interpreta-
~. would be greatly to restrict the
,.aInrs ,.yr, OF trading on the Stock Ex-
sssnre. The business Of the so-called
40 houses. it was stated. would be
t;ilsd As would the activities of trad
Ars An the floor Of the exchange.
aWsth one blow" said Mr.. Remick
q, his statement "the House Ways and
Means Committee now proposes tax
an ,he transfer Of those very securi-
~, which constitute the source Of sec
s,aary money ard working capital in
the United States. Such q proposal, II
.saeted a.. into law, would destroy any
incentive for trading in these securi-
,;ss and hence would destroy the mar
kst which has always existed for them.
an its primary effect it would thus
ron the millions OF holders of Liberty
bonds and all other securities of q
means Of converting any Of their Sc
surities into cash upon occasion; and
A. A consequence it would. in its sec,
ondary effect, dry up the sources Of
credit to corporations, which from time
inmemorial have financed their busi-
ness needs by borrowing money from
ths public through the sale Of their
obligations.
IN addition, the above tax would
have a drastic and dangerous effect
mon banks and insurance companies,
which mus, depend upon the main
tsnaace OF the freest and most active
kind II security market, to be able to
liauidate az any tine their investm ents
In private corporation securities, which
represent the funds OF their millions
o. depositors and policy holders"
Among those who have accepted Mr..
Renick's invitation to attend the con-
ference at the Stock Exchange Friday
are Philip W Wrenn, president of the
Boston Stock Exchange; John B: Bar
bour president of the Pittsburgh
Stock Exchange; T. Z. Thompson,
president Of the Washington Stock Ex
change; ". Z. Hutton. president of the
Cincinnati Stock Exchange; Walter
Munro Buffalo Chamber Of Commerce; !;
". r. Corning, president Hartford
Stock Exchange, and the president OF
the ST. Louis Stock Exchange.