The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-12-04
MELLON SEEKS
GUT IN EXCESS
PROFITS TAX
Secretary Says Effect Has
Been to Send Wealth Into
Exempt Securities
Continued from Page III

Z
revenue act, one requiring the in
ternal revenue bureau to make pub.
lie the amounts of tax paid. and
the other penalizing the publication
Of any part of the return, accord
ing to Mellon.
Hits Heavy Estate. Taxes.
A change in policy and rates on
the estate taxes must be adopted
II the Government is to retain this
form Of obtaining revenue, Mellon
told Congress. Such taxes deprive
the States of certain revenue, &C.
cording to the Secretary, who an
ticipates that the States will pre-
sent their views to Congress. Heavy
estate taxes, he added, reduce the in.
centive to build up estates and there
fore destroy capital.
"The gift tax provision was
adopted on the floor of Congress
without reference to committee"
Mellon said. "In consequence it
was never thoroughly studied and
not tied up with the other provi-
sions Of the law.
aside from the grave constitu-
tional question of the right Of Con-
gress to tax gifts at all, the gift tax
Is an excellent illustration of the
futility Of trying to prevent avoid
ance Of excessive taxes and still not
penalize legitimate transactions"
$5O5, 100000 Surplus.
Turning to fiscal affairs, Mellon
pointed to a surplus at the end of
the 1924 fiscal year Of $505, 900 900,
somewhat higher than the estimate.
He said that income taxes which
aggregated 81 1924, OO0, 900, were only
$4,000 900 less than the estimate, al.
though rs per cent reduction had
been made. He added that a 1O'
per cent change in business activity
means much greater shift relative
~ IN profits and income taxes.
Total Government expenditures
IN 1924 were reduced $4,000, 900 900
from the $6,482 900 900 maximum
OF 1920, according to the report.
The public debt, which stood at
$21 ,250,00O,0O0 June 80, 1924, was
reduced $1,09S,S94,00O during the
year, a total cut of $5,S4S, 900 900
from the peak August 81, 1919.
The aggregate cut reduces interest
approximately 1925, 200, 900 annually.
FavOrs Banking Law.
Recommendations for passage of
the McFadden and Pepper banking
bills to give relief to national banks
a 1NlP To-
in competition with State banks
were made by Mellon as part of
the program to improve the cur
rency system.
Mellon asked for an appropria-
ton Of $2,879, 900 to build up a re-
serve supply of paper currency. He
saving Of $1,500,000 annually. The
Secretary outlined the Treasury
program of increasing the circula-
ton Of silver dollars, saying that
their use would save the Govern
ment $828,000 annually.
The total foreign debt to the
United States November Is was
$10,559,929,727, according to the re-
port. Mellon described several set
lements with small powers during
the last year, adding that the total
funded debt amounts to $4,249,-
434,920, the principal part of which
Is that of Great Britain.
Silent on Debt View.
Melons report made no recon-
mendations as to Congressional
action on the debt question.
The report devoted short space
to prohibition enforcement, saying
that fines and forfeitures had
brought. $5,6S2,719 to the Treasury
in the last year. Property used in
violation Of the law valued at
$10,84S,O00 was seized by the Gov
eminent.
About $4,000, 900 gallons Of whis-
key are in legal storage in the
United States, Mellon said. With.
drawals In 1924 amounted to 1913.
600 gallons, compared to a maxi
mum whiskey consumption in 1917,
when tax was paid on over 164. 1000.
600 gallons.