The Washington herald., 1921-10-08
Tentative Agreement of
Senators Believed to
Be Likely to Hold.
MEMBERS FIGHT
RAISE IN SURTAX
House Leaders Favor 80
Per Cent Rate as
Maximum.

Although there were rumblings of
dissatisfaction over the question OF
surtss< rates. Indications yesterday
were that the tentative agreement
between the Republican Senate
leaders and the Progressive element.
led by Senators Mccormick, of nli-
nois; Lenroot, of Wisconsin, and
Capper, Of Kansas. involving i'm
portant amendments to the tax bill
would stand.
A revolt against the proposed SO
per cent maximum surtax rates was
started by some of the Eastern Re-
publican Senators who insisted that
the highest rate should be cut from
65 per cent, as in the present law
to 30 per cent, as proposed in the
bill passed by the House and now
before the Senate.
Senators reported to be leading
this movement included Mclean and
Brandegee, of Connecticut; Calder
OF New York, and Edge, Of New
Jersey.
Republican Leader Mondell. of the
House. and Representative Fordney
chairman of the House Ways and
Means Committee, expressed them
selves as favoring the SO per cent
maximum rate. They indicated that
If the Senate passes the bill with
so per cent maximum. the House
eonferees will hold out for a re-
duction.
The proposed amendments, as
made public yesterday, are substan-
TALLY as discussed during the past
two days. The McCormic k -Lenroot-
Capper group. however, accepted the
fiat Is per cent tax on corporation
incomes, abandoning their proposal
for a graduated tax.
The amendments would mean a
net increase in revenue over the
Senate bill provisions of about
S25. 900. 900. according to estimates
prepared yesterday. Total losses in
revenue would, amount to S175, ,00O.-
coo. while total gains would aggre-
gate about 5000, ,OOO, 900.
Loss on Transportation Levy.
The losses in revenue. totanng
S1T5.OOO,0OO, which would result
from the amendments, include s13S.-
on passenger. freight and express
transportation. and $4,000, 900 from
the repeal of the excise taxes. The
various miscellaneous taxes which
il is proposed to repeal. include the
tax on sporting goods, chewing gum,
electric fans, thermOs bottles. smok-
ers articles, hunting and shooting
garments, and toilet soap and soar
powders.
The tax on candy is reduced tc
a fiat rate of 8 per cent and the
tax on articles made from fur Is
c,,- 70 : per cent, and the taxes or
perfumes and essences, tooth anc
mouth washes, dentifrices and tolle
powders other than soap powder:
are eliminated. The proposed no
tel tax also is eliminated. ThesF
miscellaneous taxes represent
total reduction OF s2O.OOO,OOO. anC
II is proposed that the Finance
Committee cut out other items I,
ike M the S37.O00.0O0 decrease II
excise taxes.
biggest Gain In stock Tax.
Tho gains in revenue, amounting
% about 5000. .OOG 900. include $1S6.
ooo 600. which would be obtained
,,-f+bout much delay, and s14,50O,O ,OO'
additionaI. which would be expect
.5 eventually from an increase II
tLa5tax on estates in excess OF $40,
on0' '0O0 The item of s1S6,0OO,OOO, in
CI,,5as s75.OOO.OOO, to be obtained By
.ba restoration of the capital stocE
- which was repealed in the Sen
- committee bill. S5,OOO.000 from
increase in the higher surta1
-a+as and $61,OOO.OOO from tax o.
q per proof gallon on distilled
spirits.
srbeduIe of surtax rates provide fol
= decrease of or 2 per cent below
sho rates in the present law on al
tDco1les up to 100000. n rate of
- cent applies on incomes betweeI
e. no0 and $4,000. The present Law
r,r,,-ides a rate of per cent on in
lar,as between $4,000 and $4,000,
80 mt between $4,000 and $500
5,d per cent between $4,000 anC
s1o ono Tie Senate committee bill
starts the surtaX at $4,000 and pro
1,ides for a rate of l per cent on The
ar,oInt between $4,000 and 5000
Cd > per cent on the amount be-
t,veen $4,000 and $4,000.
Provides so Per Cent Surtax.
The maximum surtaX rate pro
cided in the proposed amendments Il
20 per cent. which is to apply on in
comes above 100000. The rate IL
the present law starts at so per CEN
on incomes above 100000. and goe.
.as high as 65 per cent on income:
above $1,000, 900. The bill as passed
bv the House. and as pending in th'
senate, provides a maximum of only
80 per cent on incomes above
S66. 900.
senator PenTose delayed calling
the meeting of the Republican mem.
bers of the Senate Finance Commit.
tee in order to give further time for
the consideration of the proposed
amendments, the text of which was
made public yesterday for the first
time in printed form. The meet
ing of the committee will be held
not later than Monday.