Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1921-09-13
Two of Four Provisions Of
Tax Bill Approved by
House
EFFECTIVE JANUARY
Final Vote Friday-After It's Dis
posal Fordney Tariff Measure VIII
Be Taken Up. 49,

PenrOSe virtually admitted defeat TO-
night, in the fight of the Administra-
ton and the Republican Senate lead
ers to reverse the action Of the House
and make the repeal of the excess
uary l.
The House Republican conference,
overturning the Ways and Means
Committee, made the repeal effective
as of January l next. Senator Pen
rose indicated that, despite all the
efforts of the party leaders, the Sen
ate Finance Coramitte probably will
vote for January next as the effec-
tive date. The vote in committee is
to be taken tomorrow.
Two of the -four major provisions
of the House bill were approved to-
day. One fixes the maximum income
surtax rate at 22 per cent, as COM
pared with the present 60 per cent,
and the other increases by $500 the
exemption allowed to heads OF fam
lilies having net incomes of $4,000 or
less and by $500 the exemption allow
ed on account of each dependent.
Apparently the Administration and
the important leaders are on the
verge of a serious defeat. Repeal Of
excess profits taxes was promised I'M
mediately by the Republicans in their
platform and speeches last fall. 1t
was explained that repeal as of Jan
uary /, 1912, was intended. lmpor-
tant business interests all over the
country have counted on it, and the
Administration has repeatedly recon-
mended it Secretary Mellon having
renewed this recommendation after
the House had acted.
When the Ways and Means Com
mittees bill to make the repeal as
of last January l was upset in the
Republican House conference little et-
fort was made on the floor of the
House to change the conferences
action. The understanding was that
the Senate would make the date jan
uary /, 1921. and force the House to
Weld. Opposition in the Finance
Committee from Democrats ana
Western Republicans appeared some
davs ago, however, and the Admin
istration forces realized that they
had fight on their hands. The Adj
mnstration may carry its hight TO the
floor of the Senate, but the leaders
fear that if they cannot hold the ma
iority of the committe they will have
a difficult time holding a majority OF
tn Senate.
Should the House date be approved,
it was said the committee probably
would approve repeal of all OF the
Transportation tax as of next Janu-
ary /, and most Of the other tax re-
peals provided for in the House bill.
Secretary MELONS proposal for reten-
tion of the transportation levies next
wear at one-half the present rates ana
the restoration Of tax on cosmetics,
perfumery and proprietary medicines,
were predicated upon retroactive re-
peal of the profits tax.
In voting to reject Secretary Mel
Ions proposal that the maximum in
come surtax rate be reduced to 20
per cent the committee took under
consideration a Treasury plan to re-
duce the rate in each of the income
surtax brackets by l per cent, so
rs to tighten the taxes on those hav-
ing incomes of less than S6S.O00 q
wear, as we'll as those whose incomes
exceed that amount.
Several new tax proposals are to
be presented to the committee. but
Chairman Penrose said it had been
decided to have final vote on the
bill next Friday so as to give the
craftsmen and experts time in which
to put the measure in shape for pre-
sensation to the Senate when Con-
eress reconveneS on Septmber 21. II
necessary the committee will hold
night sessions, Chairman Penrose
said. The question of the amount OF
the increase to be made in the cor
poration income tax as an offset tc
the repeal of the excess profits tan
has not yet been reached by the com
mittee. The House bill fixes the tota
at l21a per cent instead of the /;
per cent recommended by Mr. Mellon
and the opinion today at the Capito
seemed to be that the House rate
would be accepted if eliminstion O
the profits tax were put off until mex
January. :,
Senator Penrose said this and th'
other lesser changes RECOMMENDED
could be disposed of within a few
hours after the committee had de
cided on the very important question
Of the date of the profits tax repeasi
He said that personally he was Will
ing to make the date retroactive.
After disposing of the Tax Revlslo'
bill. the Senate Finance COMMITTEE
will resume consideration of the Ford
ney tariff measure. Senator Pen
rose said today that additional hear