Omaha daily bee., 1920-12-13
Wide Range
OF Opinion
On Taxes
Republican Leaders Still Far
From Agreement on Pro-
posed Changes - Little
Chance of Early Action.
Start Hearings Today
BY ARTHUR SEARS HENNING.
Chicago Tribune Omaha Rec Iensad Wire


Chicago Tribune Omaha Bee Leased Wire.
Washington, Dec. 12.-While con-
ierences during the opening week
OF the congressional session have de-
veloped partial program for the re-
vision of tax laws, the republican
leaders are tar from an agreement on
a number of important points OF
policy.
Hearings are scheduled to start
before the house ways and means
committee tomorrow, but there is
little possibility of even an attempt
l-sto settle the chief question at issue
until the special session of congress,
which is to be called by President
elect Harding about the middle of
March.
1t will be within Mr.. Harding's
power to frame the party policy to
a large extent in his inaugural mes
sage, With that inn view, the ways
and means c1nmittee will gather all
the information possible during the
present session, but reserve decisions
until March or April or possibly
later, if the tariff bill is completed
first.
DR.. Thomas S. Adams, professor
OF economics at Yale university and
member of the advisory tax board
OF the treasury department, will be
the girst witness at tomorrow's hear
ing. He will represent Secretary of
the Treasury Houston, who indi-
Gated desire to have the treasury
experts take the stand instead of
himself ...+
Agree on Two Points.
There are two points of policy on
which the conferences of the past
week haA Ae shown the republicans to
be in sub. 'antial agreement. One is
that the excess profits tax shall be
repealed and the other that the pay
,uent of the war debit shall be ex-
4 ,nded over period of from 40 to
oO years, instead of rs years as pro-
posed by Secretary of the Treasury
Houston.
The chief point of difference, and
one on which the republicans have
--sfaresSr-sitterfy- farz to- come to an
sa,,Eeement, is the question of sub
stitute for the excess profits tax.
There are some republicans who
hope appropriations can be reduced
to such an extent that, coupled with
a rciunding of maturing endebted-
ness, it will be unnecessary to find a
substitute. The more general view
is that new taxexs will be necessary
which will yield as much as would
be lost by the repeal of the excess
profits tax.
Two Substitutes.
The two chief substitutes for the
excess profit tax under considera-
tion area sales tax and tax on un-
distributed profits of corporations.
Secretary of the Treasury Houston,
who agrees with most republicans
that the excess profits tax should be
repealed, favors tax on undistribu-
ted profits of corporations as sub
stitute, believing that inasmuch as in
dividuals are subject to surtaxes in
addition to normal tax, corpora
tions likewise should bear some bur
tien in addition to their 10 per cent
normal tax.
Secretary Houston is not lacking
In republican support in this propos-
al. Such porminent republicans as
Representative Longworth of Ohio
and Representative Green of Iowa.
among the most influential of the
majority party members on the ways
and means committee favor the tax
on undistributed profits.
Opposed to Plan.
Other republicans, including Rep
tesentative Fordnay of Michigan,
chairman of the ways and means
committee, and Representative Cop
ley of Illinois, also a member OF
:. the committee, are strongly opposed
'Asss. ..sneh a tax, believing it to be
a tax upon capital invested in busi-
ness which should be avoided if the
industrial progress of the country
is not TO be Handicapped and crippled.
The republicans who favor the re-
peal of the excess profits tax, but
4 oppose the tax on undistfibuted
! profits of cororations, incline to-
ward sales fax. Reresentative
Mott of New York, a republican
member of the ways and means COM
mittee, introduced a bill in the house
yesterday for a per cent general
sales tax on all turnovers which
would produce about Sl,500,000,00O
annually. Representative Fordney,
Senator Smoot of Utah and Senator
McCumber of North Dakota favor
sales tax.
There are many republicans. how
ever, who fear that tax on all turn
over would lead to the pyramiding
of the tax, and an undue increase in
the cost of living. Representative
Longworth, who favors the tax on
undistributed profits of corporations,
holds this view. Representative
Copley also believes that tax on all
turnovers is impracticable, but in
stead of approving tax on undis-
tributed profits of corporations.
thinks that tax on final retail sales
would be satisfactory. One estimate
is that the latter would produce
/ S800000,000 annually.