Evening star., 1921-09-25
Huge Loss in Revenue for
1922 From Income and
Excess Profits Returns.
STRICT ECONOMIES URGED
BY FINANCE COMMITTEE
Numerous Recommendations Made
in Report Filed in s.nate-Sev-
eral Repeals Recommended.

| taxes this fiscal year was reckoned
upon by the Senate finance committee
In revising the House tax bill with
view to raising s3.324.o0o.oo0 in In
! ternai revenue in the twelve months
| ending next June 80.
lhis was disclosed by the majority
report approved by committee re-
pLblicans and made public yesterday.
The estimated total of revenue under
| the bill is s136O0o00O less than
| Treasury experts have figured would
be returned this fiscal year under the
present law, but is $S4,0O0.00o more
| than the revised total under the Hons.
bill.
! Small Cat by Law Change.
| Estimated returns this fiscal year
from income and profits taxes are
sl.ss0.0o0.000 according to the report.
as against approximately $4,000 0O0.-
GOO of actual collections in the fiscal
year ended last June 80. Only about
$50.000,000 of this difference of sl,l2O,-
100000 is accounted for by changes
proposed in the present law. Treasury
officers and committee members ex-
planned that the remainder is charged
off to shrinkage on account of busi-
ness depressions, diversion of funds
to tax-exempt securities and other
causes.
! Declaring that the 1924 000, 900
| total proposed under the revised bill
was only ss2,000.00O more than the
Treasury had estimated would have
to be raised through internal taxes.
, the report said that this was "a
margin of safety none too large for
the fiscal year 1922. i'll view of the
existing business depression and the
uncertainty attaching to the yield of
the income and profits taxes"
Retrenehment Urged.
/ port said. Ion the assumption that
with the exception of the special rail-
road expenditures. which will be
nearly if not wholly completed in the
fiscal year 1s22-the aggregate eX-
! penditure for the fiscal year 1923 will
be substantially as large as in the
fiscal year 1922. The special railroad
expenditures included in the 1922
/ budget amount, in round figures. tc
$500, 100000. and the receipts from
customs and miscellaneous sources
for the fiscal year 1923 are estimated
at s130,008.0O0. Deducting both
amounts $1.23o,000.0o0) from the
total estimated expenditures for 1922
! (S4.034. .00o.000) leaves in round fig
| ures, $4,000. 100000 to be supplied by
internal taxes for the fiscal year
1928
! The revenue bill as recommended
by your committee will raise during
1898, it is estimated. s2.735. 100000.
i The difference or deficit of $65.000.0o0
about equal to the, corresponding
surplus for the fiscal year 1s22-can
and should be avoided by saving and
economies. Your committee deliberate
| ly recommends a tax program to meet
/ ordinary expenditures on the present
scale, assuming that a reasonable meas
ure of retrenchment and reductions
will be accomplished"
Recommendation Made.
From the standpoint of revenue"
the report added, 1.-The most important
changes recommended are:
The repeal of the excess profits tax,
| which would reduce the revenue about
$4O0, 100000 annually: the repeal of
| the surtaxes in excess of So per cent.
involving an immediate loss of from
| Ss0, 0,006. 600. to $s0.o00.000 a year: the
| repeal of the capital stock tax. involv-
| ing an annual loss of about s75,000,-
OOU: the reduction of the transporta-
| ton taxes by one half on January /.
1923, and their final repeal as OF De-
| cember 81. 1928. involving reduction
| of $f31, 600, ,0OG during the caiendar
| year 1922 and an eventual loss oi
$a62. goo. 900 per year; and the adop
| ton of an additional income tax upon
corporations of per cent, which
| would increase the revenue about
| $260, 900, 900 annually
| THE excess profits tax has been so
! thoroughly discussed that it is un-
necessary to state at length the rea-
sons which have led your committee
to recommend its repeal. The time
for discussion is past. and the time
| to repeal the tax has arrived"
Position on surtaxes.
Regarding surtaxes the repor.
| said:
"Your committee recommends re-
duction of the maximum surtax from
G5 per cent to 32 per cent in the be-
lief that in the near future the lower
surtax will. by stimulating sales and
profit taking and by making possible
/ transactions now blocked by excess
i've surtax rates, not only facilitate
needed business readjustments. but
actually increase the revenue. In the
long run, In the opinion CT your com
mittee, the 80 per cent rate will
WELD more revenue than the IS per
/ cent rate"
Regarding the provision authoriz-
| ing the Secretary of the Treasury to
.