The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1921-10-11
SMOOTH OUT
BAD FEATURES
OF TAX BILL
Measure Back on Calendar
Today Sponsors Ready to
Propose Certain Elimina-
tlons.
AGREED UPON
(Ry Associated Press>


Repeal of the taxes on freight, pass
enger, Pullman, express, and oil by
pipeline transportation, effective by
next Jan. 1, was agreed to by the SEN
ate today without a record vote
An amendment by Senator Tram
mel, Democrat, Florida, to make the
repeal effective 10 days after the pas
sage of the bill, was defeated 3S to 80.
Republican leaders were hopeful
that the compromise program voted |
out by majority members of the fin
ance committee would command suffi-
cient support to enable the senate to
pass the measure late next week. De-
termined fights were promised, how
ever, over number of sections.
Chief points now in controversy so
far as the republicans are concerned /
are included in the compromise plan. |
They are the increase income surrax /
and estate tax rates, retention of the t
corporation capital stock tax and re-
striction of the $4,000 exemption to
corporations to those having incomes
of $4,000 or less. This program,
agreed upon by leaders in conference
| with republican senators in the agri- |
cultural bloc is opposed by group
| of nearly a dozen prominent senators
| from eastern states.
| Says Sure to Come
! The sales tax is bound to come, the
| senate was told today by Senator
| Smoot, Republican, Utah, author of a
manufacturers sales tax plan which
he urged as substitute for the excess
profits tax and the various miscellane-
| GUS taxes now in force.
There is no real fundamental OBJ
! lection to sales tax" the senator de-
| clared. 1T is pay as you go propo-
| sit1on and for that reason favored by
manufacturers, though they may pay
more in taxes than under the income
| and excess profits system But they
| will know to certainey Just what the
tax is; they will pay it out of current
receipts. 1t can be Immediately charg-
ed into costs as a definite amount and
without the imitation which has exist
ed under the excess profit tax, and all
taxes are charged into costs just as
| rent, wages, materials purchase, inter-
| est and all other expenses.
Everyone to whom it applied would
be able to ascertain the amount of
his liability at a glance, and the pro-
cess OF working out a tax return would
lose all its terrors. 1t will give the
treasury department a constant inflow
of revenue during monthly periods
current expenses can be met out of
current receipts to that extent. It
amounts to an adjusting of taxes to
business instead of trying to compel
business to adjust itself to taxes"
RepIys to Arguments.
Replying to arguments that the pro-
posed tax was impossible of admin
stration, Senator Smoot said this was
not a fact; that manufacturers taxes
were being collected under the present
tax law and that collections could be
made in the same manner under his
proposal.
He gave details Of the manner in
: which the five per cent tax is now col
: lected on automobile tires, tubes, parts
and accessories. He also read a letter
= from assistant internal revenue COM
( missioner Smith, who stated that in
5 his opinion the Smoot manufacturers
J., sales tax would be no more difficult
of administration than the sales taxes
imposed by the 1917 and 1918 laws.
< Under the present law" the speak
+ er said, I'VE have raised during the
fiscal year just passed close to one
!, OF sale taxes and special taxes which
D nave been passed on to the consumer,
of which about two hundred million
= dollars has been upon sales by manu-.
! tacturers. In other words we have
r collected during the fiscal year Just
\ passed under a manufacturers sales
:. tax an amount of money greater than
was obtained in the year 1916 through
the income tax on corporations"
a. Opposes Increase
The Utah senator opposed the pro.
= posed five per cent increase in the
!, corporation income tax and high sur.
!, tax rates, declaring that the latter
!. were keeping revenues from the gov.
- ernnment through the evasion OF
: taxes by men of large incomes.
division of property and invest
ments in tax exempt securities" he
/ continued, have been generally used
as the means Of avoiding high taxes
o The greater the wealth, the greater
will be the savings. The present law
merely invites persons to determine
r their own tax. The ignorant are
d ought but once only. They learn the
} method by experience.
d Our present income tax system is
r. really taxing the individuals who are
o actively engaged in business. while
1t forces out of taxation the individ
y uals having great wealth"
1t Including those adopted by majorit,
r members of the finance committe;
there are nearly $50 amendments t.
the pending bill printed and ready Il
h be offered. Some of these probabl,
o will not go in, but others are in pros
10 pect The senators from the eastern
states are understood to plan to offe
n substitutes on the surax, estae tax ant
v oher committee proposals which the,
" oppose and to demand a record vot,
;. in each case.
Todd is Named immigration