Evening star., 1939-06-02

UttHtoLfuLbOt tcIuCf SfLtU ILuLuLeu
last jail it ,Dould take initiatiue
in matter. Group outside NeU
Deal finally brought sufficient
pressure to get program started
and Secretary Morgenthau last
Saturday presented the Treas
ury'S recommendations.
Indorsing with slight reservations
the tax revision recommendations of
Secretary of the Treasury Morgen-
thau, the United States Chamber of
Commerce today submitted to the
House Ways and Means Committee
it's own program for modifying the
revenue structure.
The proposals, presented by Ellis
worth c. Alvord, vice chairman of
the business organizations Commit
tee on Federal Finance. called for
imposition of a flat-rate normal cor
poration tax of Is per cent and out
right repeal of the undistributed
profits tax. 1t included a recon-
mendation for a specific credit of
on small incomes.
The present law levies a 1872 per
cent tax on small corporations with
the rate advancing to Is per cent
as the income increases to a maxi
mum of $4,000. Corporations with
an income of more than S25,0O0 are
subjected to the undiStributed
profits tax, under which they pay
1872 per cent if all their profits are
disbursed as dividends to stock
holders and 10 per cent if profits
are retained in the corporate treas
ury. Partial disbursement in divi-
dends calls for rates between 1917
and l9 per cent.
Want to Remove Deterrents.
Both Treasury and congressional
tax experts have been studying re-
vision OF the tax system with a view
to removing levies considered de-
torrents to business improvement.
One plan calls for repeal of the
undistributed profits levy, modifica-
tion Of various other taxes bearing
on corporations and a fiat corporate
tax of % per cent Another said to
be in favor In the Senate Finance
Committee calls for somewhat SIM
liar repeals and notifications, but a
fiat tax OF 18 per cent.
The Chamber of Commerce
spokesman appeared before the
committee at time when meeting
between President Roosevelt and
a group of top flight business lead
ers had given vigorous new impetus
to discussion of business improve
ment.
The President met eight indus
trialists at the White House last
night. Means of breaking the log
jam of investment capital, it was
understood, provided a major topic
OF conversation.
Persons close to Secretary of Com
merce Hopkins said the group also
discussed broad aspects of the Ma
tional Labor Relations Act. the state
Of business and the international
situation. They asserted the busi-
neSsmen presented no definite pro-
gram or platform.
The Labor Act, which was one of
the topics, is one of the few New
Deal acts which the Commerce De-
partments Business Advisory Coun-
Gil has attacked publicly.
A year ago Charles r. Hook, one
OF last nights conferees, who was
then chairman of a council sub
committee on labor problems, took
to the White House a five-point
plan for amending the act, but
council sources said the group had
not adopted any Labor Act reports
since then. A new report was said
to be in preparation.
The Chamber of Commerce tax
program was divided into two parts
Its first section, labeled "for i'm
mediate action" follows:
l. A fiat rate normal corporation
tax of Is per cent, with specific
credit of $4,000 to reduce the appli-
cable rate on small incomes.
Profits Tax Repeal.
2. Outright repeal of the 21a per
cent undistributed profits tax.
3. A carryover of net business
losses for three years.
T. Simplification of the individual
capital gains provisions, eliminating
the unnecessary distinction between
assets held 18 and "a months and
substituting a shorter holding period.
90 The treatment of long term"
capital gains and losses of corpora
tions as ordinary gains and losses,
thus more nearly according to
corporations the treatment now ac-
corded individuals.
60 An annual declaration of
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