The Birmingham age-herald., 1921-10-22
.SURTAX RATE WAR
 BREAKS IN SENATE
 AT TER LONG DELAY
Hurry Call Sent Out by Sena- tor Lodge to Muster Full Republican Strength
 on Measure
By Associated Press

Washington, october 21.--The long threatened fight over the income sur tax rates to be written into the new revenue law broke today In the Sen ate, but despite a sizeable opposition, republican leaders expressed confi- dence that the compromise plan em- bodying a maximum rate of DO per cent would be adopted probably be- fore adjournment tomorrow evening
 Meantime. as a result of the defeat yesterday of the proposal to exempt from taxation Income of foreign traders and foreign trade corpora tions received from sources outside of the United states, the majority lead- CTS sent out hurry call to 1s absent republican senators to return to Washington. The call was In the form of a letter signed by Senator Lodge of Massachusetts, chairman of the republican conference, and Sen ator Curtia of Kansas, vice chairman and republican whip.
 The absence of republicsn sena- tors was commented upon in the Sen ate by Chairman Penrose of the ft- nance committee iu charge of the rNvenns bill
 "Questions of paramount import ' ance are being disposed of here while republicans are absent and indiffer- ent," he said T want to call the at tention of the country to it. It VIII meet with comment and condemna- ton"
 Hitchcock In Rebuttnl
 Senator Hitchcock, democrat. Ne- braska called attention that Il re- publcans joined with the democrats In defeating the committee amend ment yesterday while Senator Sim mons. democrat, North Carolina, said only 16 republicans were absent and not voting, while 12 democrats also were absent and not voting.
 While defeated in the first skirmish over amendments explained as de- signed to aid American concerns in competing with foreign rivals fol overseas trade, Chairman Penrose said today an effort would be made later to get provision in the bill 70 protect those concerns. particularly those doing business in the Philip pines and in China
 Only a few senators desiring to di B., cuss ~the income surtax rates got the opportunity today before the Senate recessed
 Senator simmons told the Senate that since the compromise amend ment was very similar to one he had offered. he would not offer any ob- jection to its adoption. Other demo- crats however opened a fight on the compromise, Senator Hitchcock pro- posing an amendment under which the rates on incomes over s100000 would be the same as those in the existing law. Senator Jones, demo crat, New Mexico. contended that if rates were to be lowered on large incomes they also should be lowered on incomes below s5 0o0.
 Senator McCumber. republican, North Dakota, one of the floor man agers of the revision bill, announced that while he favored the original proposal for a maximum surtax rate of 32 per cent. he would not offer se- rious objection to the compr 1mlse agreement for a 50 per cent rate. He argued that the lower rate would re- suit in getting more capital into TO- ductive enterprise and thus hasten the end of the industrial depression
 Four Per Cent Normal Rate
 Before getting to the surtax pro vision. the Senate approved nor nal income tax rate of per cent after a long discussion. in which tfe treasury experts, who assisted the committee in drafting the bill were attacked and defended. Approval wac given, however. with an under standing that this section would be open to amendment later, as several senators said they wanted to offer amendments reducing the rate on IT, comes below s 900.
 Senator Townsend. republican. Michigan. started the discussion about the experts with the declara- tion that there was too much expsrt language in the bill." with the jesuit that the ordinary taxpayer would never be able to understand 1t. Sem ator Moses, republican. New Ha np- shire. declared that the experts ad become group of super senator's who wrote the tax laws.
 There was only one roll call today. This resulted in the adoption. A 10 28. of an amendment approved hy finance committee republicans, defin- ing congratulations of corporations. Democrats opposing the provision said that under 1t corporations eb- sorbing others at a gain would be exempt from taxation on that gain. and that 1t also would permit of the watering of corporation stock.
 Without objection. the Senate adopted committee amendment pro- viding that if taxpayer derives a net gain through the sale of capital assets. only 10 per cent of such net gain shall be taken into account in determining the amount of taxpay- ers' net Income. Another amendment described taxable property held for more than two years for profit or m