Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1920-12-09
ALLIES MUST PAY
TEN BILLION DEBT,
HOUSTON INSISTS
Secretary Of Treasury Pro-
tests Against Attempts to
Cancel War Obligations.
DROP EXCESS PROFIT TAX.
ANNUAL REPORT ADVISES
Urges Revision of Levies So
Burden Will Fall on Those
Able to Bear 1t.
ASKS $1,000, ,OOU,O \ YEAR
Lesser sum Would BE Incompati-
bic With Safety and Sound
Finance, lie Thinks.
DROP EXCESS PROFIT TAX,
ANNUAL REPORT ADVISES
ASKS $1,000, 100000 a YEAR
lesser Sum Would BE Incompati-
bic With Safety and Sound
Finance, He Thinks.

Sr,cinl 10 Til. Times Dlspa,,iiJ
WASiiINGTON. bee s-rnn bu-
liohE OF dollars. owed TO the United
Statrs by III" allies on demand notes.
must be refunded into long time obli.
cations, cOnsrrsS Was told today l,v
thc Secretary OF tn. Treasury, David
FRANKLIN Houston. In his annual re-
port. Mr.. Houston recommends that
In" rcfundinS bonds. TO take the time
or 'l'c shorter period obligations.
shcn!h h"ar interest at least equal
10 the interest rate on bonds OF the
United States, but suggests that Con
ersFs give him authority, for the
present To crnnt extensions or The
payment OF such interest.
NJ Houston told Congress that this
solution ct tho problo,n. which ha Sc;
;ortn IN detail. WAS the most prac-
ticai one open 20 the United States
S"Tcrnmcrt under existing law Sec
Rotary Houston naycd what h. term
cd the "fatuous" attempts Of !ndivid-
uals 10 have the debt Cancelled. on the
scor" tina; 4; would promote greater
harmony. He likewise expressed con-
temp, tor ;hose wno nssert that II
Europe pays America Ia commodities
-upt domestic conlna-ce.
CniI, Securities saund.
Thee government loans to the al
is"s ar" made on Eiit-edEe security.
Mr.. Houston declared. with ample
Guarantees .: the borrowing govern
lr.ats. ail obligations bearing interest
~ the rate of 3 her cent. and that
despite the !act that this govarnment
4. t.,,
year period. this aggregate interest
rhar;:- eventually VIII by added to tn.
principai duo the United States gov
,-umcnt Thus. it is ngurcd that a,
he end OF the three year. Deferred
Iricrcs, period th. total foreign dcbt
~lI nave been increased TO si..5oo-
900 .o0O
Secretary Houston turned dear
car TO pleas made both at homo s,d
abroad for cancellation Of tn. oAt:
He said:
This is :. :avori,e plan OF some
Europeans and some Americans. n;
o:ic time !; Is based upon sentiment
or generosity BY some !, is based
on the contention that it viii pro-
mote peace"
Reforms in tax !ey:ns that viii bet
ter distribute the tax burden, but no.
reduce government revenues. were
recommended. This revised tax pro-
gram strikes AT the rich who escape
liability IN taN-.rcc securities. or IN
cvcrcapitaliZed corporations. He pro-
poses 10 cQua!ize the tax burden Of
partnerships. through a more severe
application o! tax penalties upon the
wealthy, who cloak their profits In
stock dividends" which arc nontaX-
able.
Hits Excess Profits Heavy.
Repeal OF the excess profits taxes.
readjustment OF surtaxcs. and the
adoption of some form of sales or
consumption" taxes upon certain
luxuries we're the most urgent needs.
the Secretary said.
Such revision as is made. he said
mus; be made to Keep the level Of
government revenues up TO at least
$4,000. 100000 through the fiscal year
1923 and possibly longer period.
The secretary termed reduction Of
taxes" as an utter impossibiliiy. not
compatible with national! security.
He intimatcd that present scales Of
taxes may not even he sufficient to
meet the demands OF the future.
or this he said:
ANY scheme which would yield for
several years 10 come less than s4.-
900. 100000 q year would be incom-
patiblc with safety and sound finance.
and the country should face the fact
that present taxes even may not in
the future be relied upon to yield the
needed revenue"
Congress must seek new sources OF
tax revenue for the next two years.
in order properly TO protect the
Treasury, Secretary Houston said,
ana to replace losses which may
come from the revisions recommend
ed he urges that part Of the burden
must be borne by "wastcful. but nom
taxpaying classes through luxury
taxes. He opposes general sales
taxes upon accessories.
About S2.Co0.O00.O0O Of the tax bur
5en will be shifted from the shoul-
dSrs OF those least able TO bear 1t. is
contemplated as the most beneficial
effect to the average consumer. AL
though the aggregate tax load will
be as high. its reapportionment will
fall less heavily upon the wage
earning public. in tho secretary's
opinion.
The three main tax proposals out
lined and the remedies suggested in
detail by Secretary Houston to tha
Congress were:
I. Excess profits tax should ie re-
placed in large part by some form OF
corporation profit tax. This is based
upon government needs and upon
grounds OF equality,
$50 long as taxpayers. other than
Continued onE Page Ten.)