New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-09-14
Senate Accepts
1922 Repeal of
Profits Taxes
Finance Committee Rejects
Secretary MELONS Pro-
posal That Measure In
clude Retroactive Clause
Corporations to Pay More
Levies ON Capital Stock To
Be Dropped Next July if
CongressUpholdsC Changes

pio'lSioH III Cne LAX OH repeating Lhe
excess profits tax as of January l, 1922.
was concurred in to-day by the State
Finance Committee. In effect, the
committee declined to accept the rec
of Secretary of the Treas
ury Mellon that the repeal be made
retroactive to January 1, 1921. AL
though a number of the Republican
members of the committee favored
making the repeal retroactive, when it
came to voting to-day they united in
voting to make the date OF repeal jan
uary /, 1922. The only exception was
Senator La Toilette, who is opposed to
repeal The Democratic Senators re-
Trained from voting, and 1t is expect
ed they will fight the repeal of the
excess profits tax when the bill goes
to the floor.
Having decided to make repeal date
from January ! of the coming year, the
committee was enabled to proceed on
numerous details of other tax features
1t was decided to repeal the capital
stock tax as of July |, 1922. This is in
accord with the recomm endations of
Secretary Mellon.
Adds S26O,0c0,000 Year
The committee voted to increase the
corporation income tax as of January
I, 1922, to Is per cent. 1t is 1914 pei
cent in the House bill and is 10 per
cent in existing law. Secretary Mel
lon recommended this increase, but
advised that it be dated January /
1921. This was on the supposition
however, that the repeal of the excess
profits tax would be retroactive The
committees action on this matter adds
about $685. 900 g year to the rev.
enue. The cutting out of the excess
profits tax and the capital stock tax
means loss to the revenue in the
calendar year 1922 of $50, 100000.
The committee was opposed to the
House provision exempting from income
tax the salary of the President and
the salaries Of certain judges. This
action leaves such salaries taxable, not
withstanding the decision Of the Su-
preme Court to the contrary
The House provision which exempts
from taxation the first $500 received
from dividends or interest Of building
and loan associations was stricken out
The committee also struck out the ex-
emption to travelling statesmen of tray
cling expenses while away from home
as provided by the House.
A communication was ordered sent
to Secretary Mellon asking him to sub
nit in writing definite details concern
ing the savings proposed in each de.
partment for the next fiscal wear
These have been stated to total $780,.
100000, but the committee wants as
definite figures as possible.
The committee virtually decided te
restore the taxes on express package.
and oil pipe line taxes, and also tx
put the candy taxes back to per cen
instead of per cent, as in the House
bill. Five per cent is the present law
The express tax amounts to SIT 900 ,OO(
and the pipe line tax to $4,000 900
The increase in the candy tax from
the House figure adds $4,000. 900 tc
the revenue. Action on freight and
taken tomorrow.
The chief grounds for the action OF
the committee to-day with reference
to the excess profits tax were that
it would be politically unpopular to
make repeal retroactive; that the tax
had already been charged up to the
public and thus had been discounted
by the corporations, and that to date
the retroactive repeal would benefit
the corporations, but would not benefit
either the public or the treasury
Senator Penrose, chairman of the
committee, said the committee was
working to the figure of SO 200 900, 600
as the total to be raised from the bill.
"The sum of $3,200,00O, 900 will cover
the next fiscal years appropriations, y
said Senator Penrose. 1.-The bill is not
necessarily permanent. The affairs of
the world are chaotic, and the rewriting
Of the measure may soon become neces-
sary. We are hoping that in another
year appropriations may be substan-
italy reduced, and, on the other hand,
the means of raising revenue may be
improved"
Returns Must Be Filed
The committee devoted some time to
administrative provisions and practi-
cally4 completed revision of them. To-
morrow morning it expects to settle on
all remaining details of tax rates.
The House amendment was knocked
out, and the provisions of existing law
adopted with reference to deductions by
corporations from gross income of con-
trihutions for charitable purposes. The
House put in an amendment to perm t
such deductions. The Finance Commit
tee opposes this on the ground that the
privilege was abused in the war period.
The House plan of excepting from
tax interest or bank deposits of for
eigners not having a place of business
in the United States was adopted.
An important change was agreed to
which requires every individual having
a gross income Of $4,000 or more to
make an income tax return, even
though his net income may be below
the taxable point. The present law re-
quires returns only from those whose
net incomes are above the exemption
1t is alleged many millions
escape taxation under the present law
through wrong computation of net in
comes.
The committee added an amendment
which permits national banks to count
deductions of taxes imposed on shares
of stockholders, but prohibits stock
holders from taking these deductions
also.
The committee agreed to the House
as TO conditional exemp-
ton of fraternal societies.
First Woman Grand Juror
HACKENSACK, N. j., Sept. 13-Mrs.