The Cordova daily times., 1920-12-14
RECOMMENDS
 AMENDMENTS
 TO TAX LAWS

ated Press) Immediate revision of the nations tax law on the basis of an annual levy of four billions of dol lars for a period of four years, and including an increase of two per cent in the taxes of incomes up to $5,00O is urged by Secretary Houston in his annual report to congress.
 Repeal of the excess profits taxes, elimination of certain of the so-called luxury taxes, including the levy on soda fountain and similar beverages, and a readjustment of the rates in the higher groups of income taxes, | is proposed by the treasury chief. To meet the losses brought about by these proposed changes, Mir. Houston recommends revised and new taxes to yield about $2,0OO,O0O,OOO
 l Among his recommendation is one for the repeal of the tax on soda fountain and other beverages, be- cause the collection of the tax, the aggregate of which is small has pre- sented an administrative problem of magnitude. Added to that there has been constant and widespread eva sion of such taxes.
 The excess profits tax, MT. Hous- ton declares, has not fulfilled the theoretical grounds upon which it was enacted and has been found to be wrong both in theory and in po- litical philosophy. He says it dis criminated against the conserva- lively financed corporation while aid ing materially the firms whose capi- talization is exaggerated. He urges that it be replaced by some form of a corporation profits tax mot only on the grounds of the governments revenue needs, but upon grounds of equality and justice
 An analysis of the government ex- penditures for the last fiscal year develops the fact that almost one fifth of the S6,4OOOOOO0O paid out was spent in connection with federal control and the guaranty of earnings for the railroads. Only one depart ment of the government--the war de- partment-spent more than was used in connection with the carriers. The war departments total, the record shows, was $1,611 100000 against S1,- 037, 100000 for the railroads l
 Discussing the war debt, and pro- gram for it's retirement, MT. Houston says that within the next thirty months the government will have to to pay off approximately $7,500000,- 900 in victory notes, war savings cer- tificates and treasury certificates of indebtedness He proposed that the treasury certificates not be funded further; that they be retired as ra- pidly as the treasury's conditions permit 50 the program for redeeming other government obligations will not be hampered by simultaneous pay ments
 MT. Houston tells congress that the heavy payments required by the transportation act had "disarranged the governments fiscal plans" but he believes early spring will witness final settlement of the claims of the railroads under the guaranty provi- sions and that the treasury then can proceed with it's previously announced | ,f }iripo hn the war savings certificates, amount ing to $S00,O00,000 and the victory note issue which aggregates $4,500,- OOO,OO0.
 Through operations of the sinking fund. use of the small repayments by foreign governments on loans, and the employment of certain sal wage returns to the treasury, it has retired $1,764,S96,15O in bonds. MT. Houston says, saving s10O000,000 on the transactions by buying in the open markets. Of the amount pur- chased, bonds aggregating s119,1 ,109.- 900 were retired from the funds re- paid by the foreign governments. MT. Houston strongly urges the es- tablishment of federal budget sys- tenn, declaring that unless such a plan is adopted the financial burdens of the people will be greatly in creased through the "piecemeal methods of handling appropriations 1 without regard for or relation to fn- come of the government"
 Reviewing the loans to foreign governments, MT. Houston says the American government advanced in