INCOME TAX 1923 INCLUDING FEDERAL CAPITAL STOCK TAX, By ROBERT H. MONTGOMERY, C. P. A. PREFACE During the year 1922 we have heard many tax rumblings but we have had no new federal tax law. It is not reasonable to suppose that we shall have a new law, or any important amendments to the present law until after March 4, 1923, when the present Congress expires. If there is no special session, and there is no intelligent demand for it, and since a new law cannot be passed in so short a time as the month of December, 1923 of the regular session, it probably will be some time in 1924 before any substantial changes in the tax laws need be expected. As of January 1, 1924, however, I expect to see changes in the present law. As no one can foresee what Congress will do, it is a waste of time to attempt to forecast the changes. However, I will waste just a little. I think that Congress will muddle a lot about taxing stock dividends and undistributed surplus, and another excess profits tax law-and leave most of the present procedure unchanged. I think the reorganization, exchange and capital gains provisions will, in the course of time, be made less liberal. I think other changes will be made which will ostensibly solve administrative doubts, but which will in reality increase the text of the law, which is now verbose beyond reason. We need a shorter law. It can be done, but not intelligently if its final form is left to the decision of a highly partisan and uninformed conference committee. The report of the Tax Simplification Board, dated December 2, 1922, confirms a statement frequently made but not always believed that an excess profits tax bears more heavily on small concerns than on large ones. The report says: Quite aside, then, from the tendency of the excess profits tax law to put upon the smaller and more conservatively managed corporations an onerous and discriminatory |