The New York herald., 1921-11-09
HOUSE INSURGENTS
PLAN SURTAX FIGHT
Leaders Seek to Postpone Hos
tilities Until Conferees
Rewrite Tax Bill.

WASN'T HrNoroN, Nov. e-Ths breach In
the ranks Of House Republicans over the
acceptance of the Senate maximum in
come surtax rate OF 80 pcr cent con-
tinued to-day 70 widen.
House leaders sought 70 defer tbs
Tight at least until after tho rewriting
Of the bill by the conferees gets under
way. but whether negotiations to that
end which were opened with tho 'tnsur-
gents Will be successful remains to be
decided.
II the negotiations started to-day tar
inmate without an agreement the ma
jority leaders plan to report a rule to
force the bill to conference without In
structions to the managers In that
event the Republican insurgents and
the Democrats are prepared to make a
Eght on the rule. Losing In that, they
say they still will be In q position TO
renew the fight when the House man
ayers ask for instructions.
House leaders are understood to be
ready to accept compromise on the
surtax rate at an increase Of approx
imately per cent over the 80 per cent.
maximum fixed In the bill as It passed
the House. Majority leaders in the Sem
ate. also look forward to a compromise
at around 40 per cent.
Chairman Penrose OF the Senate FL
nance Committee to-day said no ex-
pected the bill to be ready for the Pres
ident next week. Other Senators and
some House leaders were less optimistic.
Estimates as to the time of final Con-
gressional action ranged all the way
from ten days to three weeks
Treasury experts completed their es-
%ne ~ 1n 80 ftn1 ,fo1I
would be yielded by the Senate bill The
total for this fiscal year was placed at
s3,242.7 1000. as compared with 1885,
100000 under the existing law. that for
the next fiscal year at S2,7l7,2 $50. 900
and that for the calendar year 1928 at
,728,2S0.000.
A statement prepared by tho experts
and made public by Senator Penrose
said that the technical and administra-
tive improvements in the bill were quite
as important as the reductions In specific
taxes"
''The improvements In question work
IN both directions" the statement said.
"They close holes through which taxes
fairly due have hitherto escaped. and
they provide cushions to protect the tax
payer in situations where profit IL not
really made but only appears to be
made.
Avoidance of the tax through tho do
vice Of gifts will be greatly reduced.
Necessary business readjustnents or
congratulations which are now blocked
by the excessive taxation Of purely paper
gains can be carried through without
premature collection Of the tax" the
statement continued. Farmers, miners
and others who realize capital gains
which in a large majority Of cases have
been accruinge through period Of years
will be permitted to close their deals and
take their profits without fear OF a tax
unfairly made prohibitive by taxing as a
lump sum in one year profits which have
been earned over a series Of years.
1.-THE compulsory conversion Of prop
erty into cash through fire, shipwreck
and the like. will no longer be held
to result in taxable gain when the tax
payer in good faith invests tho pro-
ceeds of tho conversion In similar prop
erty and goes on conducting business.
as 1t were, at the old stand.
American citizens and domestic cor
porations engaged in business In Amen-
can possessions will escape double taxa
ton and be able TO meet foreign COM
petition on equal terms. B.
"The important amortization deduc-
ton has been limited to claims made
in returns for the years 1918 and 1919
in connection with war plant and other
facilities.
1.-THE law relating to refunds. credits
and suits for taxes has been put upon
fairer basis. In general. the tax
payer will have four years in which
to make claim for refund and five
years in which to bring suits for taxes.
The Treasury Department. similarly.
will hereafter have only four years in
which to change assessments and five
years In which to bring suits"