South Bend news-times. (South Bend, Ind.) 1913-1938, 1921-08-17
DEMOCRATS TO
ATTACK MEANS
OF REDUCTIONS
Views to Be Incorporated in
Minority Analysis Fig.
ures Not Disputed.
BEGIN DEBATE TODAY
Fordney Says That Policy of
Bill Reduces Rather Than
Shifts Burden.

bF Absoclcled Press.
WASHINGTON. Aug. 1s-The ma
tons tax bin VIII be cut Sl93.640.-
600 this fiscal year: s377. go. 600 IN
the calendar year 1922 and $3.50
100000 IN 1928, Chairman Fordnev
Of the ways and means committee
asserted Tuesday in the majority re-
port explaining the tax revision bill
framed by republican committee
men.
Without disputing these hgures.
democrats Of the house prepared I'm
caucus for a broadside assault on
the republican measure. Planning 10
brand II as rich mans bill. Their
views were 20 be Incorporated in a
minority analysis. attacking the
means by which reductions were
achieved
Begin Debate Today.
Meantime. the rules COMMITTEES
reported a rule to put the bill
through the house at 3 .. m. Satur-
day. Debate will begin at II a. m.
Wednesday. the measure having been
formally reported Tuesday by the
ways and means committee, with the
democrats voting solidly against il.
Chairman Fordney insisted In the
majority report that the policy OF
the bill was reducing rather than
shifting tax burdens" He estimat-
ed reductions in levies. some or
which would not become fully ef-
fective until 1923.
Applying TO individual taxpayers
the net difference OF $79O.32O. 600
between the losses and gains. Mr..
Fordney said they represented a
reduction Of 81 per capita or saw
ing 10 the average family Of $50 per
year"
Since the repeal OF the excess
profits tax and the reduction of
surtaX rates on individual taxes do
not become effective until 1922. Mr.
Fordney said s4O6 100000 Of tho
contemplated loss OF revenue would
not be reflected in revenue collec-
tions prior 20 the calendar year.
1928.
Quotes Secretaries.
Discussing elimination of tho
levies Mr.. Fordney quoted two for
mer democratic secretaries OF the
treasury. Glass and Houston. az mr.
ging their repeal, Mr.. Glass I'm 1919
and Mr. Houston IN 1920. Empha-
SIS was laid by She chairman or sec
lions OF the new bill resigned TO
prevent tax evasion. He informed
the house that under existing law
the taxpayer might improperly re-
duce his surtaxes by changing his
fiscal year. thus splitting his annual
income in two parts. To prevent
such an evasion. he added. the bill
provided that in the case OF "A re-
turn for a period Of less than one
year the net income shall be placed
on an annual basis and the s5urtax
properly computed thereon in &C
cordance with the number OF
months IN such period.
To prevent evasion Of tax through
the medium Of wash sales" Mr..
Fordney said a section had been put
in the bill % limit deductions for
losses by providing that no deduc-
uOn should De allowed for losses
sustained IN the sale OF securities
where the taxpayer at or about the
time OF such sale purchased idenu-
cal securities.
Provision Revised.
The provision OF the present law
dealing with surtax evasion b. cor
poration organization. the report
said, was revised % meet the decis-
ION OF the supreme court IN the
stock dividend case. There would
be imposed on corporations OF this
a fiat additional income
tax OF 25 per cent OF the net income.
but II the stockholders agreed. they
might be taxed upon their d.st-ihu-
tive shares In the net income Of the
corporation in the same manner az
members Of a partnership. such
taxes 20 be in lieu Of all income
taxes upon the corporation
Nj Fordney said some mortgage
and investment companies had been
obtaining exemptions allowed by
law 70 building and loan associations
BIZ operating under the gILse ~ such
a associations To prevent such eva
s!ons OF tax. the chairman explain
ed. the exemption had been limited
In The new bin 20 domestic buId-
ing and loan associations operated
exclusively for the purpose ~ maxi
Ing loans 20 members.'