Evening journal., 1921-08-17
81 Per CAPITA
new TAX CUT
Chairman Fordney Esti-
mates Total Reduction
at $79O,33O,OOO
DEMOCRATS READY
TO ATTACK MEASURE

WASHINGTON. Aug. 1.-THE ma
TONS tax bnl Will be cut s19s, ,64o,-
900 this fiscal year; ss77.79O. 900 in
tho calendar year 1922 and 790.-.
$50, 900 in 1928. Chairman Fordney.
Of the House ways and means com
mittee, asserted yesterday in the ma
jority report explaining the tax revi-
sion bill framed by Republican
committeeman.
without disputing the figures.
Democrats of the House prepared
in caucus for broadside assault on
the Republican measure, planning
70 brand IL as a rich mans bill.
Their views were to be incorpor-
ated in a minority analysis attack
ing the means by which reductions
were achieved.
Meantime. the rules committee
reported a rule to put the bill
through the House at 3 p. NJ Sat
urday. Debate began this morning,
the measure having been formally
reported yesterday by the ways and
means committee. with the Demo-
Gratis voting solidly against IL
Chairman Fordney insisted in the
majority report that the policy of
the bill was reducing rather than
shifting tax burdens"
Applying TO individual tax pay
ers the net difference of s79O,330,-
600 between these losses and gains.
Mr.. Fordney said, they represented a
reduction Of 81 per capita, "or a
saving to the average family Of $35
per year"
Since the repeal Of the excess
profits tax and the reduction of sur
tax rates on individual incomes do
not become effective until 1922, Mr
Fordney said s40s.250.oo0 Of the
contemplated loss Of revenue would
not be reflected in revenue collec-
tions prior TO the calendar year
1923. Discussing eliminations OF
these levies. Mr.. Fordney quoted
two former Democratic Secretaries
OF the Treasury-Glass and Hous-
ton-as urging their repeal, Mr.
Glass in 1919 and Mr.. Houston ir
1920.
Emphasis was laid by the chair
man on section Of the new bill de
signed TO prevent tax evasion. HI
informed the House that under ex
listing law the tax payer might i'm
properly reduce his surtaxes b,
changing his fiscal year. thus split
ting his annual income in TIVE
parts. To prevent. such an eva
sion. he added. the bill provided tina
in a case OF a return for a perio'
OF less than one year the net in
come shall be placed on an a
nual basis and the surtax proper
computed thereon in accordance
with the number OF months in sucl
period.
The provision OF the present lan
dealing with the surtax evasion b
corporation organizations, the repor
said. was revised to meet the deci
sion OF the Supreme Court in tn
stock dividend case. There would b
imposed on corporations OF this char
acter a fat additional income tax q
25 per cent OF the net income. bu
II the stockholders agreed, the
might be taxed on their distributiv
shares In the net income OF the cor
poration in the same manner a
members of a partnership, sue
taxes to be in lieu Of all income take
. on the corporation.
Mr.. Fordney said some mortgag
and investment companies had bee
obtaining exemptions allowed by la'
to building and loan associations b
operating under the guise OF sue
. associations. To prevent such eva
sions Of tax. the chairman explained
the exemption had been limited
the new bill to domestic buildin
and loan associations operated ez
ciusively for the purpose Of maxim
loans TO members"