The Brattleboro daily reformer. (Brattleboro, Vt.) 1913-1955, 1921-09-06

PRODUCTION, lax 1ffaSuTy Depart
ment Dislilses Delay of New Revenue.
BY DAVID LAWRENCE. .
Especial Despatch to The Reformer.)
Copyright 1921.
WASHINGTON, Sept. 6.-The Hard
ing administration intends to put the full
weight of its influence behind the orig
inal proposal of Secretary Mellon, that
the excess profits tax be repealed as of
last January so that when American
business makes out its income tax re-
turn next March there shall be only the
corporation tax of II ID per cent to
pay.
The change made in the house bill.
whereby the excess profits tax would be
repealed beginning next January, was
not made at the instance of the admin
istratiOn and was passively accepted by
Republican house leaders because of
conviction that the senate could alter
it and President Harding would bring
pressure to bear when the conference
committee of the two houses finally had
the matter in hand,
If the house plan were to prevail, not
only would American business be COM
PEELED to paw excess profits taxes next
March, but the full benefit of the repeal
would not be felt until n year from next
March, which would be after the con
gresSiOnaI elections. The Republican
leaders are mindful of the fact that they
promised in the 1920 campaign an inn
mediate repeal of the excess profits tax
and already leading Republicans, both
inside and outside of congress are saving
that If the excess profits tax is not re
pcaled. to take effect before the congress
sional election, the pledge will have been
futile.
Another Argument.
Another argument being made in favor
of repeating the excess profits tax as of
last JANUARY is the fact that this is
depression from the war and that if
business ever did need assistance and in
centive this is the time to render aid.
Furthermore. if excess profits taxes
should he collected next March for the
wear 1921. it will put strong weapon
in the hands of the members of congress
who are opposed to the repeal at any
time of the excess profit law. They viii
he able to say that if the excess profits
tax yielded so much in a bad year. the
chances are it viii WELD more in other
wears to come. and that il should be re-
tanned. The 1921 yield would he looked
npon as a minimum that could not be
ignored. In other words, congress might
be put in the position of repeating a tax
which might become the basis for cam
paign controversy next spring and SUM
mer when the congressional primaries
and elections will be in fun swing.
Other Tax Schemes.
Incidentally. the idea of n sales tax.
or rather a production tax. has not been
altogether abandoned. Senator Smoot is
working on substitute for the house tax
bill and has announced that the entire
tax program can be simplifed by means
Of a sales tax. Owing to Senator Shoots
influential position in the administration.
it is obvious that he would not be work
ing necessarily during the recess of con-
gresS if he did not have some encourage
ment from the White House 1t is known
that in cabinet discussions n production
tax, payable on goods at the source of
the manufacture. has been favored, and
the only real obstacle to the embodying
Of such tax in the new bill il the warn
ing of the treasury department. that it
would take the income tax bureau at
least four or five months to acduaint it
self with the best method of administer
ing the new law. and that the collection
of the tax would be an expensive prop
OSition.
One thing. however. business men may
be certain. the administration intends TO
stand by it's original promise to repeal
the excess profits tax az of last January
and il is predicted by cabinet members
that President Harding will probably
have his way on this matter when the
tax bill is up for final consideration.