New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-04-20
Fess Proposes
Commission to
Revise Taxes
Harding Said to Approve
Plan for Three Senators,
Three Representatives and
5 Others to Frame Report
Would Reduce Surtaxes
Asserts They Drive Capital
Into Hiding; Favors Sales
Levy for One Year Only

rrcws The fTieune,s Washington Bureau
WASHINGTON, April l9.-The first
xsrmal step toward general renovation
a. the Federal taxation system was
.aken In the House to-day, when Rep
rssentative Simeon D. Fess, Republi-
eau. Of Ohio, chairman Of the Com
r;ttee OF Education and one Of the
.blsss economists in Congress, dis
n,ssed fiscal policies before that body
for nearly two hours.
Mr.. ress's address, virtually the only
business Of the House to-day, followed
n, introduction OF a resolution pro
viding for g commission of eleven
thrse members of the House. three of
the Senate and five additional members
to inquire into all taxation and
recommend necessary revisions 1t is
manned by Republican leaders that
the findings of the commission be avail
allie by the time the permanent tariff
leyisation is completed.
Representative Tess is understood to
have received the Administrator ap-
uro1al Of his presentation. His OPEN
ing words sounded the keynote of the
new Congress.
"The one question of most command
ing and imminent Importance now be-
fore the country is our fiscal policy.
which must lie at the foundation Of
cur future prosperity" he said.
"Our chief concern to-day is the well
fare of all our people - the producer
and the consumer, the employer and
the employee, the capitalist and the
wage Garner, all together constituting
the public. The necessity of opening
the way for capital &c fully invest in
the employment of all our labor upon
basis of profit for capital and an
American wage for labor is at the base
Of our prosperity as nation. To this
end capital must be free to invest in
productive Industry. Without the chance
Of Investment of capital at profit
there is no such thing As employment
Of labor at an American standard
wage"
Would Carve Appropriations
With the cost of government esti-
mated at $t000,0o0 600 annually, he
said, it is clearly the first duty to
carve every appropriation to the bone.
The second. he declared, is to adopt q
workable budget system to provide
against future extravaga while the
.hird is so avoid entering upon any
new proiec1 which will demand great
: outlay His fourth duty is to pro-
coed without delay to reorgan:ze the
departments OF govcrnme nt to elm nate
waste and duplication.
~ L. IN rnG
Il the cost of government, said hr-
Fess. is to take immediate steps Ito
induce Europe to compose her differ
,n.es. cease to look to America as her
Sauta Claus. get to work, and make
provision for funding her debt of near
II $4,000 GOO coo, little of which has
yet been paid" :,
will reduce our necessary annual ap-
Preparations by nearly one-haif ollhon
dollars, Mr.. Fess said
@Our supreme need now. as ! see IT,
is to remove the unnecessary handl-
cans or capital. so that it will seek
nvestment ii productive industry
rather than hide in unproductive in
vestments These handicaps, which
are distinctly overnmental. are: FIRST,
our unee economic and unsclentltlc taxa
ton system, adopted because OF the
exigencies of the war, but which, two
and half years after the war still per-
sists, and second, the locked-up funds
Of the banks in the form of the gov
ernmeuts short-term certiflcates--the
governments floating debt of nearly
three billions OF dollars"
Profits Tax Indefensibls
Mr. Tess declared the excess profits
tax is indefensibe and urged its re-
peal. The income tax, he said, has be-
come and will continue to be perma-
nent. The higher surfaces, which
reach SIS per cent, or nearly twice as
high as those of England, should be
reduced. he urged.
sThe remedy here seems to me to be
eear-a revision of the income tax
fixing the minimum below a figure that
drives capital into hiding said he.
Instead of IS per cent rate let US
say 40 per cent"
Taxing up the question of sales
tax, Mr.. Fess said:
My hope is that we may be able to
cut expenses enough to save the
amounts which would be lost in the re-
peal Of the excess profits tax. The
loss In the lowering of the surtax could
oe made up either by tax on undis-
IiDuted profits of corporations or by
an increase OF the 10 per cent corpo-
,aron income tax to about 16 per cent.
would then ask the American people,
ss IN war time when we enacted
emergency legislation to win the war,
70 agree to another emergency statute
70 pay off this dangerous floating debt
and thereby release this enormous cap
,saa Tor productive industry by the
passage OF a general sales tax for one