Evening star. [volume] (Washington, D.C.) 1854-1972, 1935-08-01
Tax

Continued From First Page.)
congressional committees" Harrison
said brusquely.
Perhaps I am different" Nor
genthau replied.
In your opinion" Harrison con-
tinued, would the administration be-
satisfied with any tax program enacted
by Congress-"
They would have to be satisfied"
the Secretary said.
Declines to Apply Views.
Harrison then referred to Nor
genthau a statement by the Secretary
on ways of raising revenue for pay
ment of bonus. Morgenthau declined.
however, to discuss application OF his
views therein to the present tax need.
Would you now favor. if the bonus
were up, the procedures outlined in
your previous statement" Harrison
! asked.
do you think exemption in in
heritance tax should go down to
Sl.0O0?" the chairman continued.
Again Morgenthau referred to the
experts.
Senator Barley attempted to re-
lieve the pressure on the Secretary
by declaring some of the information
sought by Harrison was not extremely
| important.
Morgenthau finally succeeded In
| getting one of his advisers up in his
place to answer Harrison's query as
to probable revenues from inheritance
taxes at differing rates.
Asks About Liberality.
The chairman returned to the
Treasury head, however, in his next
line of inquiry.
rs it your belief liberality should
be manifested by the Treasury in
connection with estate and inher-
itance taxes upon large estates?" he
/ asked
After consulting his advisers. Nor
/ genthau said the departments policy
! should be one of liberality, but re-
ferred the committee to Mr.. Jackson
for details on the policy.
Were all of these details discussed
before the message came to Congress?"
Harrison asked. :,
NO" said Morgenthau. but soon
after withdrew the answer and said
the Treasury staff is making constant
studies of all types of taxation.
These continuous studies were
available to the President. we're they
not?" asked Senator Costigan, DEM
ocrat, of Colorado.
The Secretary agreed they were.
In further discussion of policy in
tax collection against estates, Jack
son explained that many compromises
and extensions ordinarily are granted
in liquidation proceedings.
Method of Collection Raised.
Senator Lonergan, Democrat, OF
Connecticut, entered the discussion at
this point to ask how the Government
might proceed to collect taxes in
hypothetical case of $500, 900 900 in
duStrlal concern.
Jackson answered it would be i'm
possible to lay down rule unless the
relation of liquid assets and debt
Is known.
Lonergan persisted by asking how
the tax could be met without break
ing up the business.
On concern free of debt, Jackson
suggested the floating Of bond issue,
but Lonergan refused to take this
method as an assurance that the Gov
eminent would not destroy the bust
ness in collecting its pound of flesh"
Have you ever seen business sold
by force sale that brought more than
20 cents on the dollar?" Lonergan
asked.
Might Lower Rate.
Indications that the proposed IL per
cent rate of interest on estates during
settlement might be lowered were
given when Jackson declared his belief
that this Is too high a rate. The
figure had beer stressed by Senators
Gore, Democrat, Of Oklahoma and
Gerry, Democrat, of Rhode Island.
Il would like to see these vast ex-
penditures curtailed so revenues might
really aid in reduction of public debt"
Senator Gore said in referring back
to part of Morgenthau's prepared
statement.
The Secretary's appearance was
ended at this point and Mr.. Baker be-
gan his testimony on exemption of
charitable contributions.
Our cities have been built by our
industries" Baker told the committee.
land the people of those cities need
charitable enterprises. Most of them
have recognized the need of contribut-
ing to a central charitable fund.
I'm Cleveland. IS per cent of the
community fund was contributed by
industrial corporations. At the same
time, we found this fund had ad-
ministered to some of the needs of
SO per cent of that population.
by and large, 20 to Is per cent
of all charitable funds are contributed
by corporations and a similar amount
comes from employees.
II deeply believe that corporation
has a duty to contribute to these
funds, and that the application of
these funds is an integral part of
American character building.
Il believe that corporations should
be granted tax income exemptions for
their charitable contributions just as
they have duty to make such contribu-
tons"
Presidents View Raised.
Senator Barley here raised a point
made by the President that income of
corporations belongs to stockholders.
Bakers answer was that there was
no moral issue in such a point and
that he believed the legal issue would
not be raised or sustained in any
court. There Is direct benefit to
stockholders for corporation to fulfill
its charitable duty, he added, and the
use of corporate income in this way
therefore is not a waste Of stockhold-
ers' earnings.
The need for hospitals and character
building agencies has become increased