The Birmingham age-herald., 1924-04-29
MESSAGE TAXES ARE MODIFIED
 BY SENATE VOTE
Income Tax Consideration Awaits Simmons Sub-
 stitute Plan

WASHINGTON, April 2S.-Modifi- cation of the corporation tax and repeal of the tax on telegraph and telephone messages was voted today by the Sen ate in advancing consideration of the revenue bill. Notice was given, how ever, that contests would be made later on both of these levies.
 The corporation tax was increased from 1912 to II per cent. with the un- derstanding that the capital stock tax would be eliminated. This latter amend ment is yet to be acted upon.
 Have Substitute
 Senator Simmons of North Carolina. ranking democrat on the finance con- mittee, announced that minority mem- bers were drafting a substitute carrying a graduated scale.
 Pending the writing of this amend ment, Senator Simmons said he would ask for postponement of consideration of the income tax rate section over which the main contest on the bill will center. These rates were reached to- day but were passed over at the request of the North Carolina senator. Repudiate Committee
 In voting for the repeal of the tax on telegraph and telephone messages the Senate rejected the recommendation of the finance committee. Repeal of this tax had been suggested by Secretary Mellon and was voted by the House. Chairman Shoot of the finance com mittee announced he would ask for record vote on 1t later.
 Senator Shoot explained the tax>in- volved revenue amounting to S34,O0OO0O annually and it had been restored to the bill by the committee because it was found necessary to raise more rev enue than would be forthcoming under the measure as framed by the House.
 He was supported by Senator King. democrat, Utah. but Senator Willis, re- publican. Ohio. and McKellar. democrat. Tennessee, urged clemination of the tax.
 Little opposition was voiced to the proposed change in the corporation tax but discussion of the subject stirred up considerable debate with Senator Jones, democrat, New Mexico, arguing against the general principal on which the tax is levied and in favor of graduated scale tax.
 Mir. Jones was joined by Senators Norris, republican, Nebraska and Ship stead. farmer-labor, Minnesota. in his COllLeHtlOH lldl tHe IlTeSehI IluL ldA paves the way for evasion.
 Line Up Forces
 Leaders 0! both parties were busy today lining up their forces for the approaching fight on the income tax rates. Modifying his program an- nounced yesterday, Chairman Shoot declared tonight he probably would go no higher ill proposed amendments on q maximum surtax rate than 33l2 or 35 per cent in retreating from the Mel lon plan if that is defeated.
 Furthermore he said his amendment would not call for a reduction in the normal rate below that proposed by the treasury scheme of 8 per cent on incomes below $4.000 and 6 per cent above. Yesterday Mir. Smoot had planned to cut the normal rates to the House level Other republican organization lead CTS, however. were preparing today to make a stand 'on the House income rates, adopted with the aid of repub- lican votes in an effort to defeat the Senate democratic income tax sched- ule which proposes a maximum surtax than the House or Mellon plan.
 Senator Simmons declared democrats not only stood chance to gain adop- tion of their higher surtax schedule but the rates in this schedule might even have to be increased above 10 per cent to satisfy the wishes of ma jority. The present maximum surtax is 50 per cent.