Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1921-09-09
MELLON ADVISES
SENATE To MAKE
CUTS IN HOUSE
TAXATION BILL
Again Recommends Repeal Of
Excess Profits Tax EffeC-
tive as Of Last January,
Not Next One.
WOULD RETAIN RAILROAD
=. XES WITH HALF RA TE
,ecretary Places Probable
{ Revenue Needs Of Govern
ment for This Fiscal Year
at S4,034,00O, 10000
tBy The Associated Press.l

Washington, Sept. S.--Changes
in the house tax bill. recommend
ed today to the senate finance
committee by Secretary Mellon in
cluded:
Repeal of the excess profits tax
effective as Of last January in
stead of next January 1.
Retention of all transportation
taxes for 1929, but at half the
present rates instead of complete
repeal as of next January 1.
Repeal Of the capital stock tax
effective next year, new pro-
posal.
Reduction of the maximum in
come surtax rate from 63 per
cent to 25 per cent effective next
January /, instead of to 80 per
cent as provided in the house bill.
An increase of 5 per cent. in
stead of 2 IL per cent in the
normal corporation income tax,
making the total Is per cent,
retroactive to last January 1.
A manufacturers tax on cos
metics and proprietary medicines
/ to replace present stamp taxes
which We're eliminated by the
house.
Retention next year of the taxes
on insurance premiums but at one
half present rates.
With these exceptions, the secre-
tary was understood to have ap-
proved the house measure with its
provisions for an increase of $500
in the exemption TO head of fam
lilies having net incomes of $4,000
a year or less and 5000 additional
for dependents; for decreased
rates on sporting goods, yachts
| and furs ,and for manufacturers
taxes on fountain syrups and other
ingredients of soft drinks In lieu
! of the so-called nuisance taxes.
The secretary placed the prob
able revenue needs of the govern
ment for this fiscal year at S4,-
| e34 100000 on the basis of the
reduction in expenditures agreed
! on at the white house tax con-
ference last August and estimated
$500, 100000 of this total would be
raised from non-tax sources, leav-
ing $3,234,000,000 to come from
inetrnal taxes.
This total is s134,000,0O0 less
than the estima ted receipts
under the house bill for
this year, the difference being ac-
counted for through repeal of the
excess profits tax as of last jan
uary 1. 1t was to make up the
loss from the profits tax that MIR.
Mellon proposed an additional . 1-2
per cent increase in the corpora
ton income tax, retention of the
transportation and insurance prem
ium taxes and restoration of the
taxes on cosmetics and proprietary
medicines.
h The additional corporation in
lcome tax is estimated by treasury
officials to yield approximately
$260,000,O00 year. The trans
lportation tax would return $780,
100000 next year at half the pres
ent rates and the insurance taxes
land levies on cosmetics and medi-
cines s25,00O,O00.
Explaining his proposal for q
further reduction of per cent IN
the premium income surtax rates
Mr.. Mellon was said to have de-
clared that the lower rate event.
lually would return a greater yield
to the government than the 32 per
Icent rate, because additional money
would be devoted to active bust
ness instead of being invested in
tax exemption securities.
1t was stated that there was nc
discussion Of new sources Of taxa.
tion and that none was recon-.
mended by Mr.. Mellon who esti.
mated that the house bill as a.
mended in accord with his re.
recommendation would meet the
needs of the government, provid.
ed the economies agreed on al
the white house conference were
leffected.
| AS to the authorization in the
house bill for the treasury to issue
$500, 100000 additional in shor,
term notes, 1t was said officially
that this had no relation to any
anticipated deficit and was MOI
wholly necessary as the treasury
had asked for Ii merely with the
idea of having a little more margin
in funding victory notes and certi
ficates of Indebtedness into shor
term securities.