Evening star., 1921-10-05
OPEN
MINDED ON TAXES
Senate and House Leaders at
White House Discussing
Question.

Question.
The congressional tangle over tax
legislation was given the attention
of the administration today at a sue
cession of conferences between Presi-
dent Harding and Senate and House
leaders. Among those who saw the
President during the day were Sena-
tor Lodge Of Massachusetts,, the re-
tive Mondell of Wyoming, republican
leader of the House: Speaker Gillett
and several other senators and rep
resentatives interested in tax legis-
lation.
What position the President may
take regarding substitution OF a
sales tax measure for the House TAX
revision was not disclosed. Those
who saw MIR. Harding declared that ne
was keeping his mind open on the
subject for the present. 1t was inoi-
Gated. however. that there was 8
possibility he might take a definite
stand in the near future in order To
smooth out the disagreement among
republican members of Congress on
the subject and expedite the legisia-
tive program.
Opposes Sales Tax.
Representative Mondell vigorously
opposed the sales tax proposition
telling the President that such pro-
posal had little support in the House
He declared a sales tax schedule nke
that proposed in the Senate would
fail to accomplish the reduction OF
tax burdens contemplated by the
House measure and would require an
immense amount of time-consumine
work to put it into practical form.
The legislative program as worked
out among congressional leaders and
the administration, the House leader
said, provided for consideration at
this session of tax and tariff legisla-
| ton, the railroad financing bill. the
foreign, debt funding measure. the
anti-beer bill and bills for road i'm
provement and maternity relief
Should the tariff bill fail of final pas
sage, he added, it would be necessary
ent emergency tariff schedule.
While talk of revolt OF progressive
republicans against the finance com:
Ismittee tax revision btH H<an1ksFiHnOs1
of alliances between the democrats and
thu Aprpgresaiyes tQs smash the COMMIT
tee bill are going the rounds the 8hredf
! manufacturers sales tax plan as sub,
stitute for the committee bill 10 6p-
parently gaining strength daily. Many
Of the senators who early in the ses-
sion were outsp0ken against sales
tax plan are swinging over to the plan
as proposed by the Utah senator This
fs true Of some of the progressive re-
) publicans from the west and middle
west, who originally opposed the sales
tax plan. 1t is true also Of some of
the democrats who were outspoken
against a sales tax some months ago.
A great mass Of letters and tele-
grams favoring the sales tax plan IL
being sent to the senators favoying
the sales tax. Senators who favor
emanating from leaders of the House
to the effect that the House will not
stand for a sales tax bill with a
grain of salt. The program. in a
tentative way, has been made to in
clude a graduated corporation income
| tax ranging from 10 to 20 per cent
further reduction in the lower surtax
rates on individual incomes. but an
increase from 81 per cent to so per
cent in the highest surtaxes: reten-
| ton of the corporation capital stock tax
an increase in the higher rates of estate
taxes, and repeal of the taxes on
freight, passenger and express trans
portation.
Chairman PenrOse's Statement.
Emphasizing the fact that the pend
ing tax bill was of a temporary and
rose of the Senate finance committee
has issued a statement saying that
further revenue revision legislation
should be enacted for the next taxa
BILE year, or as soon thereafter as pos
sible.
Senator Penrose went on record again
as being opposed to the adoption Of a
sales tax at this time. Promptness OF
action on the pending bill is neces-
sary. he said. and not experiments
with untried forms Of taxation.
House leaders are emphatic in their
declaration that sales tax could not
be put through that body now.
Several amendments to the tax bill
designed to stimulate construction OF
homes were proposed yesterday by
Senator Calder of New York, head OF
the special Senate committee which
some time ago made an Investigation
of building conditions. One amend.
the sale of dwellings between January
1, 1922, and January 1. 1927. shall be
exempt from taxation if used in con-
structing other dwellings within one
year after the sale. Another would
provide that taxpayers shall be al.
| lowed an exemption up to $4,000 or
moneys received as interest on funds
lent for building or purchasing dwell.
ings.
Amendments Accepted.
Committee amendments agreed te
in the Senate included those requiring
individuals having a gross income OF
Sc, 900 year to make a return re-
gardless of the amount of the net
income and permitting the taxpayer
t6 make a deduction for debts ascer.
tanned to be worthless and charged
off within a taxable year.
Several amendments were proposed
from the floor. Senator King, demo.
crat. Utah. offered substitute fol
his previous income surtax amend.
ment, under which the maximum
portion Of the. income in excess o,
$4,000. The rate on the first $2,o1(
of net income would be 2 per cent
! that on the next $1,000, 3 per cent
| that on the next $1,000, 4 per cent
with an increase of ! per cent fol
each additional $1,000 up to $s,0h0
Then the rate would be increased ]
per cent for each additional $4,000.
Senator Lodge of Massachusetts,, tn.
republican leader. proposed that de.
ductions be allowed to corporations
for rents received from buildings OF
| any character to the extent of pei
cent "of the fair market value OF
such buildings and the land on which
! they stand"
Repeal of the freight, passenger
and Pullman taxes was proposed by
Senator Harris, democrat, Georgia
who also gave notice that he would
offer an amendment proposing tina,
where income is derived from the
labor or personal service Of the in.
dividual taxpayer the rate on thy
lrst. 900 should be 2 per cent, and
that on the second $4,000 4 per cent.