Evening star., 1936-04-28
WASTE" Of HOUSE
SEEN IN TAX BILL.
Discrimination to Draft Final
Measure Held Argument
: for Abolition.
BY DAVID LAWRENCE.

L
Eyery now and then something
happens in national affairs to vindi-
cate the Judgment Of Senator George
W. Norris OF Nebraska in his concept
of representative government as it
should be.
Quite unwittingly, the House OF
Representatives has furnished in the
last few days the best argument and
demonstration of why it might be bet
ter for the national Legislature to be
composed of one house instead OF
two-a reform which Mr.. Norris sue
ceeded in establishing in the LegiSla-
ture of his home State OF Nebraska.
The circumstances are these: A tax
bill of transcendent importance to the
economic and fiscal system of the Ma
ton is under consideration. From
time to time during the debates, less
than a hundred Representatives out
of the 435 elected have been present
on the floor. Also, every member feels
that the tax bill is going to be rewritten
by the Senate. The measure is to
be voted on and passed this week by
the House Of Representatives, notwith-
standing the fact that a substantial
majority knows full well it is never
to become law in the present form.
Costly to pass Buck"
The American people pay $4,000 a
year to each member of the House Of
Representative or total of $4,350,-
900. They pay $4,000 year to each
of the SO members Of the Senate, or a
total of only s960,000. Obviously, if
House members are going to pass the
buck" to the Senate and are not going
to take the responsibility of writing
legislation, there is a big economy
possible IN having single house COM
bining the best features of both and
with a much smaller membership than
now.
The pending tax bill is probably the
worst piece Of tax legislation that
has been written in 20 years Big
business gets certain advantages. out
of it. Small businesses get many PEN
alties out of it and considerable DAM
age. Monopoly is encouraged be-
cause weak competitors are hurt by
the unequal tax provisions. Businesses
of large size with vested interest
in certain fields of industry will be
secure against newcomers because Of
the new tax bill
Difficult to Interpret.
But apart from these uneconomic
features the bill is so clunsily writ
ten that it will take a tax expert or
a lawyer specializing in tax law to
help most every business man make
out his return. The layman who reads
the proposed tax bill and can figure
out how to compute the tax is the
exception rather than the rule.
Far from being a simplified tax
system for business institutions, it is
complicated. AS for the alleged modi-
ricationS to help businesses that have
debts as well as contracts to pay of
debts instead of dividends, the meas
ure takes care Of all debts incurred
prior to March 3, 1886, but is silent
on future debt contracts.
. This can only mean that companies
that wish to borrow money in the
future will have to do so under hard
ships that never have existed before.
A company cannot say it will borrow
q certain sum and pay off all of it
before giving its stockholders divi-
dends. 1t will have to say to the
lender that it can pay only certain
amount and the rest must go to stock
holders unless prohibitive tax is paid
Costly in Operation.
In other words. the safety Of future
nesses in particular will be materially
changed by the new tax law if the
Senate retains what the House pro-
poses.
There are many provisions of the
law which will cost good deal to ad-
minister. But the cost to the tax
payer to conform to the law will be
an increasing item of expense.
The supposition is that the Senate
will change all this and make it work.
able. But the question might well be
asked why the House of Representa-
tives doesn't improve on the hodge,
podge offered it by the Treasury De-
partment and give the Senate an idea
of what the public reaction to specific
parts Of the bill is when changes have
been made. The House is elected
every two years, while only one e-third
Of the Senate comes up for election
every two years. The Senate is not
as directly responsive therefore to the
1885 election as is the House and the
House now can transfer to the Senate
whatever blame accrues. II there were
only one house elected every two years
every member would feel, it is con-
tended. a greater sense Of RESPONSE
bility for the writing of legislation.
(Copyright. 1885,