The Washington herald., 1921-09-17
Senate Committee Makes
Changes Affecting
Lower Brackets.
MEASURE is NOW
READY TO REPORT
Amendment Adds Five
Per Cent to Part of
Luxury Taxes.

Revision of the House tax bill.
preparatory to reporting it to the
Senate next Wednesday. was vir-
tually completed yesterday after
noon after the adoption during the
day OF numerous amendments.
Important among the changes
made yesterday was the adoption of
an amendment revising the surtax
rates. by which those below the
maximum of 80 per cent, fixed in
both House and Senate bills, were
changed, some raised and some
lowered
Under the amendment adopted the
surtax will begin with 1 per cent on
incomes from $4,000 to 5000. in
stead of from $1,000 to $1,000 as un-
der present law. On incomes up
to $50. 1000. the rate in each bracket
Is reduced 1 per cent. On incomes
from $4,000 to $4,000, the rate in
each bracket is increased per
cent. Then the rates are left as
under present law up to incomes
exceeding $66,Ooo. where the maxi
mum uniform rate of 80 per cent
will apply.
Changes VIII Cost s1s.ooo.ooo. .
The changes will lose the Fed
eral treasury $1s,oo0,0o0 annually,
II is estimated.
The committee also revised the
so-called luxury tax which the
House bill levied as a substitute
for the luxury taxes" of section
904 of the present law. The amend
mert levies a tax of per cent on
the following articles in excess of
the price given:
Carpets, 81 per square yard.
Rugs, s6 per square yard.
valises. travelling bags, suit
cases, hatboxes and fitted boxes, $50
each.
Trunks, s35 each.
Purses. pocketbooks. shop and
handbags, IS each.
Umbrellas, IS each.
Smoking Jackets, bathrobes. etc,
taxed in the House bill are not
mentioned.
Applies Only on Excess
The House bill levfes the per
cent tax on the same articles at
somewhat lower prices, but the tax
to apply on the whole selling price.
IL sold at prices in excess of the
figures given. Under the Senate
bill, the tax would apply only on
excess.
The Senate committee, however.
approved a tax of 5 per cent on
the whole price of office furniture
and fixtures made from imported
woods.
Its previous action levying
per cent tax on proprietary medi-
cines was rescinded and medicines
left free.
1t reduced from 10 to 7k cents
per gallon the tax on fountain
drink syrups-
Allows for Capital Losses.
The House sections relating to
capital gains and losses were ap-
proved. except that it was amended
to make the rate on capital gains
16 per cent and to allow, in case
of net losses, deductions for the
whole loss. The House bill taxes
capital gains 1914 per cent, but al
lows only a 12h per cent deduction
for a net loss.
The insurance sections of the
House bill were amended to make
the corporation normal tax apply
to investment incomes of life in
surance companies only. AS to
other insurance companies, IT was
explained the present plan will con-
tinue. but all will take the cor
poration rate. All premium taxes
are repealed as of next January.
The House sections defining for
eign traders and foreign trade cor
porations were approved. They are
defined as those so per cent or more
of whose income is derived from
business done in another country.
The committee rescinded its ear
lier action and voted that in the