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Show THE TAX-EXEMPT PROBLEM Under the present revenue law, persons receiving income subject sub-ject to Federal income taxes may evade all or part of the federal tax by an ingenious method. They borrow money and invest it in tax-free securities an4 then deduct the interest paid on the money borrowed for that purpose from their taxable income. The revenue bill which passed the House and is now being considered con-sidered by the Senate cotnains a provision to prevent this practice. It requires income received from tax-free securities to be deducted deduct-ed from interest paid out and permits credit only on the balance thus left for the purpose of reducing taxable income. Promoters of tax-free bonds will try every possible known trick and scheme to kill this meritorious section when the bill is considered by the Senate. That section of the House revenue bill requiring income from I tax-free securities to be' deducted from interest paid by a taxpayer, before interest paid can be applied to reduce taxable income, would help relieve the situation some. |