The times-news. [volume] (Hendersonville, N.C.) 1927-current, 1937-11-15


BILE"
A capital gains tax was impos-
ed in 1913. taxing such gains on
the same basis and az the same
rates as other income. The 1913
act did not allow taxpayers to
deduct capital losses from their
taxable income. The 1916 and
1917 revenue acts permitted de-
duction of capital losses up to the
sum of any capital gainst in the
corresponding taX-paying period,
Winthrop W. Aldrich of the
Chase National Bank and others
have cantcndcd that the heavy
taxation imposed on capital gains
combined with the limitation on
deduction Of capital losses from
taxable income have been factors
in creating an unhealthy stock
market situation. 1t is argued
that the capital gains tax dissuad-
as investors from taking profits
when they are available and that
stock prices, therefore. are pyra-
midcd TO peaks from which they
collapse suddenly a. in the sharp
recession of recent weeks.
SEC ALSO TARGET
Combined with attacks on the
tax structure are complaints that
security and exchange act rcStrlc-
tons hamper the stock market
and contribute to it's uncertain
ties. Those complaints will fall
naturally into tn" debates which
promise this autumn To center
around business conditions. taxes,
the budget and what President
Roosevelt intends to do about
them.
Senator Carter Glass. D.. Va,
will be Il forccful figure in that
debate which probably will delay
cop surplus control and the other
Roosevelt projects presented to
this special session for action.
Glass proposed this month that
Mr.. Roosevelt seek recovery now
by easing tax brakes on business
and. specifically, that congress re-
peal the corporation reserves tax
and modify the tax on capital
gains. Glass is not a New Deal
spokesman. But he speaks for
large body Of conservative Demo
cratic opinion and in this instance
for business, generally.
The foregoing tax issues are
only part OF congress problem. Ii
is called on this winter TO revise
the entire tax structure in the
interests of fairness and simple
ity. The principal difficulty there
is definition of fairness" be-
cause some members would raise
and others would lower existing
rates and there are various blocks
favoring repeal or extension Of
almost every levy. But in any
event, congress will be forced to
enact tax Legislation of some
kind.
TWO COURSES OPEN
If the budget is to be balanced
congress must impose economy on
Mr.. Roosevelt or join him in "A
cooperative economy program un-
less there is TO be general in
crease of tax on everyone. All
Washington realizes that fact
Mr.. Roosevelt in an address at
Hyde Park. y. Y. last month
said:
I'VE all agree that unless fed
cral taxes are to be greatly in
creased, the expenditures have to
be brought within existing re-
cciptS."
Soon aftcrward he warned con-
grcsS that it must hold cXpcndi-
lures for crop surplus control
within budget limitations or inn
pose new taxes TO pay the bill.
Everyone realizes that there is
no money in the treasury for
crop surplus control. So new
taxes, probably processing taxes,
will be levied to pay for it.
While this need for new rcvc-
nue. was developing, the treasury
reported that it had greatly over
estimated tax returns in this fiS-
cal year which of itself might
arouse demand for even higher
taxes. The alternative would be
less spending.