The New York herald., 1921-08-31
SMOOT BILL REPEALS
50 NUISANCE TAXES
Senator Would Clean Slate
and Enact a 3 Per Cent.
Basic Sales Tax.
IGNORES HOUSE ACTION
Manufacturers Not to Pass
Levy On to Either Retail
ers or Consumers.
TOBACCO STILL TO PAY
Five Other Items Retained,
but Gross Yield Is Estimated
at 1896, 900,
Special Despatch to THE NEW YORK HERALD.
New York Herald Bureau,
Washington, ID. c., Aug. 30.

Special Despatch to THE NEW YoRK HERALD.
New York Herald Bureau,
Washington, ID. c.. Aug. 80.
A brand new revenue bill, eliminat-
ing practically all of the present taxes.
is to be offered to the Finance Com
nnittee Of the Senate by Senator Reed
Smoot (Utah), a member of that COM
mittee. The Smoot bill ignores the
revenue measure passed by the House
Of Representatives before adjournment.
1t provides for manufacturers sales
tax of per cent on all commodities.
Six methods or measures of taxation
are provided. They are in addition to
the manufacturers sales tax:
An income tax with maximum
of 80 per cent.
A 10 per cent. corporation profits
tax.
The present tobacco taxes.
The present estate tax
Tariff import duties.
Senator Smoot believes that the taxes
proposed will meet the revenue needs OF
the Government. and that they vii
greatly simplify the methods and prob
lens of tax collection. 1t would ne
said, benefit the Government and the
taxpayers and would permit sharp re-
ductions In the expense of tax collection.
Bill Marked by Simplicity.
Senator Smoot described the workings
and provisions Of his bill here tonight
and announced that he would urge the
Senate Finance Committee to accept 1t.
as the basis of its discussions. Ignoring
the House bill, which represents the
work of several months by the Ways
and Means Committee. 1t Is COM
plete measure and the Senator estimates
1t would raise a. surplus Of $100,0o0,000
above actual needs.
Senator Penrose, chairman of the FL
nance Committee. is In Philadelphia. He
is expected to return Thursday. The
Finance Committee will finish hearings
on the tariff bill tomorrow. and lay IT
aside to take up the revenue bill. but
It is probable that nothing definite will
be done until after Labor Day.
Senator Smoot Is one OF the strongest
advocates of sales tax. His new pro-
posal Of manufacturers sales tax on
products worth $40 900, 100000 annually
is a development of his original turn
over sales tax proposal. which was at
tacs1ed from many quarters.
The Smoot bill provides for repeal of
the excess profits tax, retroactive to jan
uary l. 1921.
Outlining the features and provisions
Of his measure, the Senator said:
Briefly my proposal Is to repeal every
revenue law on the books to-day and
write new law, so that It will be an
easy thing for everybody to know just
what the law Is.
"The programme is to strike out every
provision of the revenue bill just adopted
by the House, after the enacting clause.
and to insert provisions imposing taxes
from six sources and from these secure
of the Government for the present year.
Estimates OF Probable Yield.
II estimate the receipts from these
new forms OF taxation as follows:
From income taxes, with the maxi
mum rate 32 per cent, so as to dis
courage Investments In tax exempt
securities. about ss3o.ooo.00o.
From a 10 per cent. tax on the net
profits of corporations, about s445, 000,-
000
From tobacco taxes. at the present
rate. about s255. 100000.
From an estate tax. at the present
rates. about $3.50, 100000.
From import duties, and ] do not
believe that the new tariff bill will
yield any more income. about $40O, ,00o.-
900.
From per cent. manufacturers
sales tax to be imposed only on the
manufactured article and therefore does
not pass to the retailer or the jobber.
about $1,000. 900. 900.
I'm addition, the Government will re-