TAX ON CORPORATIONS.

Dominion, Volume 3, Issue 622, 27 September 1909, Page 7

TAX ON CORPORATIONS.

A DEMOCRATS VIEW/ By Tclesraph-rrc6B Asaocittion-Copyritjht) (Red. September W, 56 pm.) jU 'ji,,}Naw,Yorh.,, September 20, Congressman MMV, Denver (Democrat) in a speech, declared that tho new tax of 1 per 1 cent en the net earnings of corporations was a ! compromise to'prevent tbo ilaqsago of tho income tax/ which, if passed, would have undermined the protective system, and would hayo enabled the Demoorate to push their propaganda on behalf of a tariff for revenue purposes only. . \ Ho advised tho State to lmpojo heavy graduated inheritance taxes, and to pass laws j requiring the division of muiti-milhon-aires' fortunes. ' i

.'.■/WJLii CdJlpiJl/ THB^DISCIibsUItB';OF/' :%';■■;'" ;;.;;: ,-/accoiints, ; :-/ ;■■,-/'//■' ■-;; •"Presldcht'.Tafi proposed 'in. income'iaxi : but tiltitriatelyhadtb/be'contont with a tax on the earnings/of■■ oorppfations/-Tho tax; Was briffln. ally-2. per : cent'::(es,tim^ted::to.produco' about (S20,000i00p), but'wan reduced in, Congress to lpor cent, .The.United States Treasury deficit for/tho'y.ear/is/.511'.000.00D, The anti'tarift Democrat's/argument is ,'that tho Republicans do nbt .want to/breato enough revenue from direct itaxatlon'.tb provfdo a;; good ground for lowering the tariff../:/-,'m .'/•..//.'•, •. "The'-: hostility ; .Vof,;.:the. American', press .-towards thq.' corporation inc'ohie'-tax ' (writes the American cormspgndent of "Tho Times") has apparently i had (no: effect upon President Taft and the' Senate ; : .dtsenthngled from the proposal of ft persona! incime-tax, this/apichd-.rabnt.was/adontcd-as.part.of the Tariff Bill by a-voto/of 60 tbMl, .Only three Democrats and eight Itepnblicans .voted against, tho final of .the; President's, compromise.. ;.,'•.' In-voHhff alrocst uiiaeiimoiisly. for: this mcasuro, the Sonato/lips.-shown' a /surprising-''disregard' of tho oppositibhialmost.unanimously/bxprossed by -the - press-'.of:. the' country. Hardly, a Eo-publican'-npwspaper'.of 'standing "favoured the idea, whUc .tho so-callqd' Independent journals of-. the/Eastern States; havo' :assailed' Mr.' Teit for k urging -the. ( amehdrabnt with"a virulence which recalls'-the attacks v.on .'Mr. "Eobsevolt. The: reasons given ftt this opposition ate that the. proposed tax is.-.unjust'and ''unequal; .that it taxis,a corporation and exempts' an individual or paTtnefshipJ that it' is an experimeht and'.'Will clog the courts .with.'lawsuits, arid 'kjwp-.all- the lawyers :arid ■ Judges : busy fof many years.! "■:■ ■ i., ■,--* .-■.'..■■ , .'' "-:• -•!■>■""•,■■, ...The' tax in .assessed on "the'net 'earnings- in excess of of all corporations,.-joint 'stock companies, 'and associations'orgahised-fpr prbfit and .haying a capital /stock -represented >by sharps, and- all Insurance cbmparifos.' Foreign corporations ova:liable, for: the Us to :the extent, of- business in> the States. Tho net lnbome.unoh which the tax is paid is to be ascertained,by:fdeqnoting frbm the,;grope income:of the corporation•'all OfdinAry ; nnd ncceffiary of ..operation and- maintenance;, all uncompensated losses: actually paid within ..the year /on, its bonded 'or/'other * indebtedness • not,-, wooding the' paid-dp . oapitil stock; all Federal.and gtate taxcsalready paid; and,all /amounts, received -by it' as dividends tipon. stock, or/other 'corpprations,- snbicot/ to the tax hbrebv imposed.'..-'.- ~i .•.;.•.'..■'•.-..'.■. "All ccmpanie.V. subject to this tax will be re. (jnired to. mate a'roturn on or'-before MArcß I pf .each'.year as,to/their financial-,condition. The.return,jimist : be made under oath,of the rbfusal,,or ..neglect the I'delißqucnt" is. liable,, to a fine of -.from- J3200 to fn?tha case, pf. fnlgo or! frauduletit rotuf n,' in. addition: to tho - fine, :-tb imprison; meht for a-.term,iiqt. to.exceed orte yearT-Tho effects of. this, tax law : on the corporations of tho/cpuntry rr.ay, easily be- imagined,' for'if ouforcod it ts bound 1 to resnlt in scburift6 aoc.nrrvt*:; returns:to "tUo. Collector of .Internal -!K e Wf- ,n .''tn' a? i' I *K n 'v.----^ r '-- :T, '' | ;-bßlieveß that this publication of the operations of companies will; bo a distinct, aid In improving cor-.norntion--'b'usines.l methods in -tho United States. Tt is.safe'.to assume- that ;tho ontcry nnninst-tho. .passage'of ,tho measuro has' been as;much duo, tp tho dishko.of American corporations to' divulge their' accounts' as to the fax itself.-". •;■ ..-.' ' -. .. . ~,■