The New York herald., 1921-08-17
BILL REDUCES 1921
TAXES $193,64O,OO0
Fordney Makes Estimate of
Lower Rates in 1928
of $790,330,0O0.
ABOUT 81 PER CAPITA
Chairman Explains Burden
Is Not Shifted, but Is De-
creased i'll Size.
EVASIONS MADE HARDER
Rule Made for Vote Saturday
at 3 P. M.-DemOcrats Are
Planning Fight.
EVASIONS MADE HARDER

WASHINGTON, Aug. 16.-The nations
tax bin will be cut s193,640,00o this
fiscal year, s377.790,ooo in the calendar
year 1922 and $3.50, 100000 in 1928,
Chairman Fordney of the Ways and
Means Committee asserted to-day in
the majority report explaining the tax
revision bill framed by Republican
committeeman.
Without disputing the figures, Demo-
Gratis of the House prepared In eau
Gus for broadside assault on the Re-
publican measure planning to brand
it as a rich mans bill. Their views
were to be incorporated in minority
analysis attacking the means by which
reductions were achieved.
Meantime the Rules Committee re-
ported rule to rut the bill through the
House at 3 p. NJ. Saturday Debate Will
begin at Ii A. NJ. tomorrow. the meas
ure having been formally reported to-
day by the Way5 and Means Committee,
with the De1 ocrats voting solidiy
against It.
Chairman Fordney insisted in the ma
was reducing rather than shifting tax
burdens" He estimated reductions In
levies, some IT which will not become
fully effective until 1928, as follows
Repeal of excess profits, January
1, 1922, $3.50, 100000: reduction OF
surtax rates Oh individual incomes
to 80 per cent, January /, 1922,
$90,000.0U0.
Increased exemptions of heads Of
far m
excess of $1,000, 100000 900: addi-
tional exemptions for dependents. in
creased to s400. from 5000.
$4,000, 900.
Repeal Of all transportation taxes,
January /. 1922 $262,000.0o0.
Repeal of tix on life insurance.
$6.3o0.000.
Repeal of taxes on beverages.
100000. 900.
Reduction OF taxes on candy.
s8,000.00H.
Sporting goods. $4,000. 900.
Furs. s4.51e.0G0.
So called luxury taxes. s15,000,000.
Gains In Collections In 1923.
Estimated gains in taxes beginning
with the calendar year 1928 are given
rs follows
Increase Of corporation income tax
from 10 to 1914 per cent, January
/, 1922, $1a3,750.000.
License to sellers OF soft drinks,
$10.000,o00.
Tax of six cents on cereal bever-
ages, s12.000,000.
Tax of five cents on carbonic acid
gas. 100000.
Taxes on fruit juices, still drinks
and fountain syrups, $12,000,000.
G,,h ,hatf ~ 70 ~, at.ef
taxes on toilet preparations and pro-
prietary medicines for existing stamp
taxes, sS.0O0,000.
The total loss in revenue is thus
placed at 1868, ,0s0.O00 and the total
gains at S177.750.00 leaving the net
loss of $3.50. $50. 900 estimated by the
report.
Applying to individual taxpayers the
net difference of T90,330.00O between
these losses and gains. Mr.. Fordney said
they represented a reduction of 81 per
capita, "or a saving to the average fam
lily Of SS5 per year"
Since the repeal Of the excess profits
tax and the reduction of surtax rates
on individual incomes do not become ef-
fective until 1922. Mr.. Fordney said
s406.250.000 OF the contemplated loss of
revenue would not be reflected In rev.
year 1923. Discussing elimination of
these levies. Mr.. Fordney quoted two
former Democratic Secretaries OF the
Trea asury-Glass and Houston--as urg-
ing their repeal, Mr.. Glass in 1919 and
Mr.. Houston in 1920
Preventing Evnsions of Taxes.
Emphasis was laid by the chairman
on sections of the new bill designed to
prevent tax evasion. He informed the
House that under existing law the tax
payer might improperly reduce his sur
taxes by changing his fiscal year. thus
splitting his annual income In two parts.
To prevent such an evasion, he added,
the bill provided that In the case OF a
return for a period of less than one
year the net income shall be placed on
an annual basis and the surtax properly
computed thereon in accordance with
the number of months in such period.
To prevent evasion OF tax through the
medium OF wash sales" Mr.. Fordney
said a section had been put in the bin
to limit deductions for losses by provid-
ing that no deduction should be allowed
for losses sustained in the sale OF Sc
curities where the taxpayers at or about
the time OF such sale purchased identical
securities.
The provision OF the present law deal
ing with surtax exasion by corporation