Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-12-17
RELIEF IN SIGHT =
ON INCOME TAX
Those Unable to Pay in De-
cember May Get Until
March IS.
BY DAVID LAWRENCE.

Relief for the many large business
concerns which were unable to pay
their December installment of the in
come tax seems to be in sight.
The House ways and means COM
mittee has practically agreed to re-
port -favorably a bill introduced by
Representative Edmonds of Pennsyl-
vania, whereby the penalty of 5 per
cent for failure to pay the December
installment shall be eliminated and
shall not be made to apply unless the
next.
The government, hovesey. win re-
cetve interest on the period befwleen
December Is and March Is.
Seriousness Realized.
Secretary Houston vigorously op-
posed any extension of time to tax
payers. when the matter was FIRST
proposed. simply because 1t was
feared that No Discrimination could
be made between those who were
really unable to pay and those who
naturally wanted to use the money
for other purposes. But with Decem-
Der Is now past and the collectors of
internal revenue from all parts Of
the country reporting large sums
unpaid. the seriousness of the situa-
tion is fully realized here.
Indeed. unless the government takes
action as provided in the Edmonds
resolution some big concerns will be
forced to the wall. The fact is the
Treasury department at present has
no discretion whatsoever, and the S
per cent penalty is already in effect
The law is mandatory. 1t provides
that ten days after the income tax
shall have been due and been unpaid
the collector of internal revenue shall
send out a warrant of distraint.
Within thirty days thereafter COL
lectors would be compelled under the
law to force the sale Of all the assets
of a concern in order to get the in
come taxes due the government. It is
one of the most drastic laws on the
statute books.
Evidence Of liability.
Business men have known what
the penalties were. and the fact that
they defaulred on December IS and
preferred to take the consequences is
an indication that many of them were
absolutely sincere in their protesta-
tions Of inability to pay the tax.
In several cases the big concerns
found the banks unwilling to lend the
money. and some of them feel now
that the banks must relent and fur
nish the funds; Rumors are afloat in
identally that the Federal Reserve
Board intends to lower the rediscount
rate. and that money will be more
plentiful after the first of January,
but there is no confirmation Of the
rumor.
Congress has the responsibility for
the moment of helping the business men
over tight place. The Treasury must
follow the letter Of the law or its vari-
Gus collectors will be liable to penal
ties for failure to collect taxes
The republicans in the House have
sounded their colleagues in the Senate
and the impression is general that both
houses will pass the Edmonds resolu-
ton.
Secretary Houston has given no in
timation of his attitude, but it is not
believed that he will oppose it. The al
tentative is either making the govern
ment stand the loss temporarily or fore
ing receiverships in many important
business houses. The latter might have
a serious effect on the entire business
situation.
Copyright, 192O.)