, 1921-08-18
Revenue Bill Makers Find Way to
Reduce Taxes by About
Half a Billion.
GOVERNMENT EXPENSES CUT
Income Tax Allowance for Depend
ents Ooubied-Grain Exchange
Regulation Bill Passed by
Senate-Siiesian Question
Referred to League
of Nations.
BY EDWARD W. PIckARo.

Although 1t has been freely and
generally predicted that the Repub-
licans would be- unable to carry out
this year their party pledge to lower
taxes, that the revenue bill would
show only revision and not reduction
because of the necessarily large ex-
penses OF government. 1t now appears
they have found a way to fulfll the
psomise. President Harding mt the
majority leaders OF the house got to-
gether last week II agreed on a
program by which government expen-
dltures will be cut $516,0OO,00O. This
calls for the raising of $3.075.00O.0O0
from internal taxation, which Is $685.
100000 les than the total which the
treasury estimated would be the yield
Of the present law during the fiscal
year.. 1922. The total 10 be raised
from all sources, but not including
postal receipts. will be $4,034, 000 1900.
According to the agreement. saving
In the various departmental appro-
priations will amount to $50, 1000,
and a plan was. devised whereby the
public debt expenditures will be re-
duced $50. 0OO.O 900.
1t was the earnest desire OF the Re
publican leaders that the imposition
of new taxes be avoided, and under
the present plan the proposed $40 tax
ON automobiles, the Scent postage
aud 2-cent stamp on bank checks will
be unnecessary.
OF more Immediate interest, per
haps. to the average citizen was the
action of the ways and means com
pittee OF the house, which is framing
the revenue bill, concerning the per-
sonal income tax 1t was voted that
the allowance for each dependent
shall be $500 Instead of 500 as at
present, which means a greatly In
creased exemption for the man with
= large family. A proposition to in
crease the present exemption OF ST.
100 for single persons and 5000 for
heads of families to $500 and $500
respectively was voted down. This
would have meant a loss OF revenue
Of nearly fifty million dollars. An
other change adopted was the reduc-
Ion OF the tax on very large Incomes.
There Will be no tax above the 81 per
,ent now levied on incomes of $685.
OO-which will be n relief to about
len thousand OF our wealthiest clti-
zens. but will not call for cheers
from the rest OF us.
4 The committee also decided ON q
complete repeal Of taxes on freight,
passenger and Pullman transports-
alon, and Increased the Nat corpor-
htion tax from 10 per cent TO IL per
tent. In this and other respects the
committee disagreed with the results
pr the conference with the President,
'hnd the changes II has made TO date
lower the yield from Internal taxes
20 5000. 0oO.OOO. or course all these
fhings are dependent on further ac-
Hon by the committee and acceptance
ply the house aud senate.
The losses In revenue below the
present law which will result from
1le program as II now stands include
f4oo.O00,o00 from repeal Of the excess
profits tax, So0.O00,O0 o from the re-
duction In the higher surfaces. S145,.
cOO.OOO from repeal Of the tax OF 3
lper cent on freight. S~1OO,OO0OOO from
fepeal OF the tax OF 3 per cent on
passenger transportation. Ss.OOO,OOO
Prom the repeal OF the 8 per cent tax
pn Pullman charges, S25.OOO,O00 from
Hhe repeal Of the soda fountain tax,
'~lo'OOo,OOO from the repeal Of the
tnr on proprietary medicines, besides
few smaller items which bring the
Total up TO 1891 100000.
increases made ofsettlng these loss