Pueblo chieftain., 1921-05-02
MELLON SUBMITS
FOUR PROPOSALS
Continued rrom Page one)

tanned in a letter to Chairman Ford
ney OF the house ways and means
committee.
Mr.. Mellon suggests adoption of
administrative amendments to the
revenue laws simplifying collections
and permitting, under safeguards, the
carrying over of net losses by tax
payers for one year as deduction
from incomes OF succeeding years.
The treasury is not prepared" he
says, mot to recommend any general
sales tax"
Mr.. Mellon says also that he wishes
It were possible to recommend the
repeal of the transportation tax but
adds that 1t produces annually around
$3.50 .000.0 900 and its repeal cannot be
effected with safety unless congress
has n substitute" He also suggests
TO congress that it may be 'advis-
able" to take action to restrict further
issues OF tax exempt securities, say
ing that it is estimated that there are
now outstanding Slo.000,000,000 of
these securities
Emphasizing that expenditures for
this fiscal year have been at the rate
of $4,000, 100000 Mr.. Mellon warns
congress that the nation cannot con-
tinue to spend at this shocking rate"
Substantial cuts in current o1pendi-
lures, he said. offer the only hope of
effective relief from the tax burden.
Reduction OF appropriations more
over will not OF itself be effective to
reduce expenditures unless congress
avoids or controls measures which re-
suit in expenditures without an ap-
parent appropriation. he says.
'Reappropriations of uneNpendcd
balances. revolving fund. appropria
tions ard appropriations OF receipts
and other indefinite authorizations of
expenditures in the past have beg,
responsible for hundreds of millions
of dollars of actual cash outgo." Mr..
Mellon said that estimates for 1872
are subject to great uncertainty. The
estimated collections of 1890. 000. 900
of internal taxes arc based on the pro-
visions OF existing law. he adds and
are $3.50. .000.o 900 less than the esu-
mated collections for 1921. chiefly
because of the shrinkaSc. in business.
The estimated ordinary cypendi-
lures of $i.ol4.0O0.oo0 Will bo ef-
fected by appropriations still to be
made" he adds.
The estimated expenditures OF the
war department and the nevy depart
100000 for 1922 will depend largely
upon the military and naval policy
adopted.
The estimate of about s5+5. 900. 900
for payment to the railwayo in 1879
is made necessary by the provisions
OF tne Transportation act anu IN
creased estimates from the director
general OF railways
In absence OF drastic cuts in mill
tary and naval expenditures there is
almost no prospect of any substantial
available surplus even in 1o22."
Urging carly repeal OF the excess
profits taxes. no says, an intelligent
revision OF these taxes should en-
courage production The profits
taxes, he estimates. will yield not
moro than s450.ooo. 900 for the tax
ablo year of 1921.
As for n substitute for this tax. Mr..
Mellon cites estimates of $500, 900. 900
annually for an additional fiat tax OF
five per cent on incorporate incomes.
providing the exemption of. $4,000
now accorded corporations is olimi-
mated.
Discussing tho readjustmont OF in
come tax rates, no says higher surtaS
rates have reached the point where
they servo to drive capital into tax
exempt securities and thus reduce tho
revenue.
The tobacco and capital stock taxes
and the taxes on admissions should
be retained. he believes but he urges
that so-called luxury and nuisance
taxes be got rid of because they are
relatively unproductivc and un-
necessarily vcNatious."