The Prince George's enquirer and southern Maryland advertiser., 1921-09-16
new DRAFT OF
TAX MEASURE
Finance Committee Decides to
Recast House Legislation
Into Uniform Work.
ADOPT sM00T PROPOSAL
New Technical Form OF Bill Is One
Originally Suggested by the Treas
ury Experts-speciaI Tariff
Agents at Work.

| NaShlngt On.-ln Deglnnlng cOhSlQeT
alton Of the tax bill the Senate Fl
nance Committee decided to change
| the form of the measure. The bill, as
| it will be reported to the senate, will
consist of Il complete revision of eX
listing revenue laws, containing both
new sections and those which are left
| unchanged. The bill as passed by the
house consisted of Il long series OF
amendments to the present law The
portions of the present law which
were not changed were not printed in
the bill, and consequently in order to
understand the measure it was neceS-
sary to cohpare the new sections with
the old law.
This action by the senate committee
does not mean that the substance of
the house bill will necessarily be
changed. The technical form of the
measure can be changed without any
difficulty.
By providing for complete revision
proved the method originally adopted
Oy treasury experts in presenting. 81
tentative draft to the House Ways
and Means Committee. Members of
the Ways and Means Committee,
however, were Of the opinion that the
9ill would be less cumbersome and
hpn hn of
the house If it contained only amend
ments to the existing law. The house
committee by deciding not to adopt
the treasury form cut the length of
the bill in two and greatly reduced
the time required to read the measure
on the floor of the house.
Senator Penrose, chairman of the
Finance Committee, in announcing the
action, said that the purpose was to
place the bill in such form as it can be
most easily understood.
I'VE want the bill to be in the form
which it can be most easily read by
the taxpayer" said Senator Penrose.
I'VE do not want to have several hun
lred amendments attached like bar
HdCleS u llle present law.
Democratic, as well as Republican,
members of the Finance Committee
were in attendance. Although the
committee worked on the bill for sew
eral hours, no action was taken with
reference to any controversial points
In the bill.
DR.. Thomas S. Adams, tax expert of
the Treasury Department, who was
chiefly responsible for the drafting
of the bill as originally submitted to
the house committee by the treasury,
was present and explained various fea-
lures of the house measure. The COM
mittee began at the beginning of the
bill and started to read the measure
through, section by section During
the four hours only ii of the 80 pages
of the bill were covered. The sec
tions read included those relating to
personal service corporations, those
defining foreign traders and foreign
.rade corporations, and various fea-
lures for determining gain or loss i'll
computing income taxes. These sec
tiOns include provision for fiat
rate of 121a per cent of the net profit
from the sale of capital assets when
a taxpayers total net income and
capital net gain exceed $4,000.
There was considerable discussion
over the method of taxing personal
service corporations. The bill now
provides for taxing personal service
corporations at flat rate of 121s per
cent in the same manner as ordinary
corporation are to be taxed. Hereto
fore personal service corporations have
been taxed in the same manner as
corporations are to be taxed Hereto
legality of this procedure has been
raised us a result of a Supreme Court
decision.
Some of the sections disclosed re-
lated to the taxation of income in.
volved in gifts of bequests The bill
makes number Of amendments to
the existing law dealing with this sub
ject.
There was no discussion of the ques-
tion as to whether the income tax
changes shall be retroactive on income
of the calendar year 1921. There also
was no discussion of the plan proposed
by Senator Smoot of Utah for a per
cent tax on manufacturers sales Sen
ator Smoot did not bring up this gues-
tion and will not press the matter
until the sections Of the bill dealing
with miscellaneous taxes are reached.
The change in the form of the bill
from Il series Of amendments to a
complete revision of existing law was
one of the proposals advocated by
Senator SmOOt.