Evening star., 1924-02-21
PR0V|S|0NSOF TAX
ON STOCK PROFITS
CHANGED BY HOUSE
Earnings on Shares Redeem
ed by Liquidation Subject
ed to Income Rates.
WILL CLOSE LOOPHOLE
IN LAW, CLAIMS GREEN
Mutual Life Association Not
Operated for Profit Exempted
From Provisions.

Provisions of the revenue bill re
iating to profits on corporation stocks
were further frightened today by the
House with an amendment subjecting
earnings on stock redeemed by cor
porations in liquidation proceedings
to regular income rates rather than
to the 1215 per cent capital gain tax.
An amendment exempting benevo-
lent mutual life insurance associa-
tions mot operated for profit then
was adopted, SO to 81, on a tellers
vote.
Chairman Green of the ways and
means committee. who proposed the
stock profits amendment. said it would
close a loophole in the law by which
some stockholders would evade ali
but 12i@ per cent tax on profits on
stocks redeemed by liquidation. 1t
was agreed to by Representative
Garner, Texas. and Oldfield, Arkansas.
To Perfect LAW.
Representatives Mills. New Tortl
and Chindblom, Illinois, republican
members on the committee, opposed
it. Representative Dickinson pointed
out that his amendment was merely
had exempted farmers and mutual in
surance companies, but which ha1
lost the right on a court decision.
The amendment provides th2'
farmers or other mutual, hail.
cyclone casualty or fire insuranc''
companies. mutual ditch or irriSa
tion companies, mutual or co-opera
tive telephone companies. or like or
ganizations. shall be exempt froni
taxation, but only if substantially
all the income consists of amounts
collected from members for the pur-
pose of meeting losses and ex-
penSes.
Further amendment of the sec
ton to include, benevolent mutua.
ated for profit, whose business is
purely local and solely for benefit
of it's members" was accomplished
after sharp fight. Representative
it. Chairman Green insisted pro-
visions for such companies already
had been made and the amendment
would complicate the bill, but it was
ly, joined by number Of republicans
Hurry Work on Bill.
The House hurried along with con
sideration of the revenue bill toda.'
while leaders lined up their forces for
la second showdown on the income
rates section with the bill is up for
final passage.
A stubborn contest over the income
rates voted into the bill by the demo
Gratis and republican insurgents ap
pears certain. with Representative
Longworths republican leader, claim
ing d detection in the ranks of the
seventeen republicans who voted for
the Garner schedule. Some of them,
he said. have made overtures indi-
eating they would like to vote for
republican measure.
Study of Strntegy.
Leaders are studying the parlia-
mentary strategy involved in such
contest, and the organization repub
licans are centering their attention
on an effort to obtain a record vote
on the compromise suggested Tuesday
by Mr.. Longworth calling for maxi
mum Surtax rate of 3712 per cent and
the normal income rates recommended
by Secretary Mellon.
The democratic schedule raised the
maximum surtaX from the proposed
% per cent to A per cent, cut nor
NAL rates and increased personal eX-
emptiors. A solid majority vote on
several parliamentary decisions as
A
necessary for displacement Of the
democratic rate.
Administrative sections of the bill
were read today, and Chairman Green
of the ways and means committee. in
| charge of the discussion, expressed
hope that the estate and excise tax
sections might be reached by tomor-
row at latest.
Income Tax Provision.
Among other sections yet to be
taken up is the provision for -
per cent reduction in 1928 income
taxes, payable this year, and demo-
cratic leaders have said they would
seek to amend this to make the in
come tax schedule already adopted
retroactive as of 1923.
Reading of the measure section by
for amendment, proceeded rapidly
Chairman Green of the ways and
means committee, in charge of the
bill on the floor. When the House
adjourned such progress had been
made that Representative Garner of
Texas. in charge of the Democratic
fight on the floor, suggested an agree
ment be reached to bring the measure
up for a final vote on passage by next
TuGSday. 1Ie6n
he thought an earlier day might be
set, but Mr. Garner asked that 1t be
voted on not before Monday, indicat-
ing a desire to make sure of a full
party presence which might not be
possible on Saturday because Of week
end absentees.
Amendments Offered.
Although numerous amendments
were offered, only those submitted by
the leaders received any substantial
support. The democrats stood almost
solidly behind both the major amend
ments adopted. which were proposed
by Representative Garner. Mr.. Green
chided those on both sides, not mem
bers of the ways and means commit
tee which framed the bill. who sought
private amendments which the COM
mittee had considered Impossible. lie
declared at one point. in seeking to
limit debate, that you are making a
joke of this measure If you continue
such actions
The stock dividends amendment
proposed by Representative Garner
and adopted by tellers' vote, 163 to
112, provides that stock received
either as stock dividend or a. .
gift by the taxpayer should not -
| termed capital assets. Capital A.
| sets held by the taxpayer for prodt
| or investment for more than I've
CONTINUED on Page 2. Column l.,