New-York tribune., 1922-02-22
Bonus Based
On Sales Tax
Is Agreed On
House Members Decide to
Report Bill 10 Impose
, to 4 Per Cent Lew
on : c lcctc Il Articles
Mellon Is Questioned
Representatives of Mid
Western States Launch
Campaign Against Plan

rross The T~fbuncs WoShi1oton BU~eou
WASHINGTON, Feb. 21-Pavment
i o, the cash feature OF the soldier bonus
i through a modified sales tax will be
] sssed of Congress hy tho House WAYS
snd Means Committee. The determina-
ticn to follow the only course which
has not been frowued upon hy Presi-
dent Harding WAS definitely established
to-day, coincident with the appearance
@ Secretary of the Treasury Mellon
before sn executive session Of tho sub
committee in charge Of the revenue
provision of the bonus bill.
After sgain declaring his opposition
80 anything that would put new drain
VI N the Treasury or cause the impo-
a Ion of new taxes, the Treasury Sec
etary told the sub committee shat If
tie bonus bill must be passed the only
NJ V to pay the cost was through the
ss IS tax. He suggested a form of that
tax, which was described as combina-
tiou 1nanufact turers' and wholesalers
levy.
The plan formulated by The commit
tee through sort OF cross -examina-
ticu OF Mr.. Mellon AS to the effects
upon the country Of the various forms
Of sales tax would call for rates of
frcm 10 per cent on number of
specific commodities. He advised such
a system in preference to the prevalent
idea st the Capitol of laying a blanket
I sales tax and then naming certain ex-
emptons, which would include farm
n l.
4 products and several other Of the more
important necessities.
Target of Tax Uncertain
1t VAS not brought out definitely
I what articles would carry the bonus
tax burden, the scheme being to col
| lcct on only so many rs arc needed "to
carry tho traffic" according to Repre-
h sentative Nicholas Longworth, of Ohio,
| Mr.. Mellon was declared to have
l agreed with the members of the sub
| committee, which is headed by Chair
| man Fordncy, that the sales tax should
/ rot take the form of either a turn
/ over tax or a tax upon retailers. The
| least harmful method, in their belief
l would be q combination which would
| call for the collection in some cases
l from the manufacturers and in others
l from wholesalers.
Secretary Mellon also was questioned
or the possible results Of following the
only other course open to the commit
! tee, reporting bonus bill without def
4 into revenue provisions. He denounced
that proposition vigorously, declaring
that It was impractical from every
/ standpoint and would force a subse-
1 q1ent money authorization OF some
knd by Congress.
While the Ways and Means Commit
1 -
plans, the representatives of the eleven
Middle Western agricultural states.
S1o have organized a campaign against
sne sales tax, renewed their attack A
letter, signed By twenty-three members
and sent 20 all members, urged defeat
OF "any manufacturers or other sales
YAK es means Of raising revenues for
meeting this Obligation
Underwood Opposes Bonus
In the Senate to-day Senator'S Under
wood ard Myers on the Democratic
SIDE referred to the bonus in the course
Of the discussion of the disabled Of
fcers' retirement bill. Both opposed
the cash bonus. Senator Underwood
said.
81 am not in favor of bonus bill.
The men who served the United States
III the great war and who came home
sound and we'll have an asset not
liability. 1t is an asset any man
should be proud of-the glory of de-
tending in battle his country. And
| one OF the reasons why l support This
MI to aid the emergency officers who
zero wounded or disabled in the line
l "i duty is because I believe that the
money of the American taxpayers
snould be used not to pay those who
are sound in limb and in good health.
| out should be applied to the care Of
those who have been incapacitated as
=. result of wounds or other dsabili-
Ties incurred in the line of duty and
service TO their country"
Myers 1ndorses View
Senator Myers took the same view
| IS Senator Underwood. "In nv opin-
| lon,' ne said, eve should not only be
| lGst, but we should be generous to the
| ols1Died and the injured of our armies
mo served so gallantly in the " orld
war. oppose A bonus, but I do favor
Going everything within reason that
Ne can do for those who, because Of
| 10 o'fauit Of their own, suffered serious
'aJury or were otherwise disabled in
| the performance of their duties"
Senator France. Of Maryland, Repub-
iicsn, said he was opposed to the cash
BONUS at this time because the country
could not stand the strain Of it eco
nom ically- He announced that he
would speak on the subject in the Sen
ATE tomorrow. In that speech he will
bring up his proposal for the United
States to take over the former German
colonies in payment of the Allied debt
and through these rich territories to
pay the soldiers. Senator France in
announcing that he would speak to-
morrow expressed regret the Senate
did not allow moving pictures in the
chamber. He would like to illustrate
MS speech with moving pictures. AS
It Is, he is giving an exhibit showing
The resources of the former German
folc ss, especially In Africa.
N CsF ETT Er