Show Round Merry nd Tax Proposal Would Cut Mart Profits By Drew Pearson W WASHINGTON A A hi highly g h I Y confidential memorandum on proposed changes in the ta tax laws contains some bad news for commodity speculators who vho have been raking In in millions in profits Chairman Harold I Knutson Knut- Knut son son sori of at the house ways and means committee considered the memo so secret and explosive that he refused at first to show it even evento evento evento to committee members fearing leaks to the press press The memo was prepared by bythe bythe bythe the internal revenue bureau and recommends 49 specific changes in tax statutes including a sweeping revision of capital gains assessments Congress also is urged to plug up existing loopholes loopholes's in capital capital capital capi capi- tal gains tax r regulations e go u 1 a. a ti a n s through which short term capital capital capital capi capi- tal gains may be converted into long term capital gains and through which fictitious losses are used to offset real gains in income returns To discourage speculating the law now requires speculators to pay a tax on their full profits provided they dispose of securities securities securities ties or commodities within six months short months short term term term-of of p pur pur- pur r- r chase If on the other hand they dispose of securities and commodities held longer than six months months long long term they term they pay a tax on only 50 per cent of their profits Therefore many speculators speculators speculators convert their short term gains Into long term merely by telling their brokers to defer payment on sales safes until after the six-month six deadline thus greatly reducing their tax taxes s. s Also many with broker connivance only declare declare de de- de- de clare dare losses in the tho six-month six period period pe pe- pe- pe nod but keep their profitable accounts operative for longer than six months thereby cutting cutting cutting cut cut- ting taxes in half In other words the present capital gains tax law tends tomake to tomake tomake make the United States a nation nation nation na na- na- na tion of speculators and tax sharpshooters o 0 Other t the h c r Recommendations Recommendations- These tax evasion practices have been hotly denounced by Secretary Secretary Secretary Secre Secre- tary of Agriculture Clinton Anderson Anderson Anderson An An- derson and the Internal revenue bureau now urges that they be changed Other changes recommended by the bureau include 1 Making employers who delay delay de de- delay de- de lay payment of withholding taxes from subject to toa toa toa a civil penalty Some employers employers employers em- em em em- make a habit of using with withholding taxes to defray business expenses instead of im immediately immediately im- im mediately turning them over to the treasury 2 Authorizing the federal government to th withhold wages from federal who are delinquent in Income taxes 3 Elimination of the long established practice of allowing deductions for work clothes except except except ex ex- ex- ex specialized clothing for particular occupations 4 A sweeping revision of the current method of computing the taxable income of life insurance companies to more equitably reflect their profits 5 A revision of the law dealing dealIng dealing deal- deal Ing with recovered war losses in order to make the tax on U. U S. S property in enemy countries re recovered recovered recovered re- re covered after the war var equal to the deduction claimed by the tho owner when he lost the property property property prop prop- erty on Dec 7 1941 6 That corporations be permitted permitted permitted per per- to prorate a heavy loss five years forward and one year ba back k instead d of using the present pres pres- ent method of a year two-year carryback carryback carry back and a year two-year carryover carryover carry carryover over Round Merry Here Is the presidential slate of that unreconstructed unreconstructed unreconstructed constructed reb rebel l Chip Robert Jim Folsom of Alabama for president Pappy ODaniel of Texas Texas' for s secretary of state Claude Pepper of Florida attorney attorney at at- attorney torney general Congressional al clerks almost h had ha to revive members of the joint congressional congressional congressional economic committee from shock when Jesse Wolcott Volcott of Michigan said ho he now might be in favor of price controls What broke down this Inveterate foe of price controls was the increase In steel prices Attention General Fleming chief of ot the Federal Vor Works agency What are you doing a about fout the fact that a member of your staff Frances R. R Belue was in the commodity market Copyright t 1948 Bell Syndicate |