Evening star., 1921-08-11
AGREE ON CHANGE
IN TAX MEASURE
Reduction of $555, 600, 900 Is
Net Result of Yester-
days Work.

Practically all of the important
changes proposed to be made in the
1918 tax law have been agreed upon
tentatively by the majority members
Of the House ways and means COM
mittee.
Some minor revisions are in con-
temptation and when a final agree
ment is had on all the changes the
physical rewriting of the law will
be taken up. When they assembled
today. the committeeman believed
their labors could be completed by
late Saturday and the bill made ready
for consideration by tie republican
conference next Monday.
The net reduction in the yearly tax
total as a result of the committees s
work yesterday was estimated at
S555. .oO0 600, with a total internal rev.
enue income for the government of
S3,110.000, 900. Losses in revenue were
roughly estimated as follows:
Repeal of the excess profits tax
and higher income surtax brackets,
Elimination of the freight, passen-
ger and Pullman transportation taxes.
$253. 600, 900.
Increase of the exemption allowed
heads of dependents from 5000 to
s4OO for each dependent. $50.8O0.000.
Removal of the wearing apparel.
levies on toilet preparations and pro-
prietary medicines, $4S,000.000.
The levying of a manufacturers
tax of 3 cents a gallon on certain
classes of grape juice and cents a
gallon on other classes in lieu of the
present tax of 10 per cent on the sale
price.
1t also was agreed to levy cents
pound on carbonic acid gas sold to
manufacturers of carbonated gases.
Increased Revenue Seen.
Increased revenue figured upon in
cluded 263,600.000 from the per
corporations and s66,000,00O from
manufacturers taxes on fountain sir
ups, toilet articles, proprietary medi-
cines. bottled beverages and grape
juice.
Treasury experts had prepared to-
day for presentation to the commit
tee revised estimates on government
income and expenditures in accord
with those agreed upon at the con-
ference Tuesday night between Pres
ident Harding, Secretary Mellon and
republican leaders of the House
These included reductions of $780,
100000 in the estimated expenditures
for this year.
Iasfsts ON Cuts.
In transmitting the revised esti-
mates, Secretary Mellon wrote Chair
strongly emphasize" that the program
agreed upon at the White House con-
ference and outlined in his letter de
pends upon the reductions in expen-
diture which the administration ex-
poets to accomplish, and that the an
tlcipated savings can be effected only
by the most insistent and determined
efforts to cut expenditure"
The estimate of receipts, on the
other hand" Mr. Mellon continued,
represents the utmost expected to ac-
crue during the year. particularly in
view of the uncertainties resulting
from the depression. in business and
the shrinkage in incomes and profits"
Mr.; Mellon also informed the COM
nittee that in order to carry out the
program proposed and provide further
for the financing of the short-dated
should have enlarged authority for the
issuance ard retirement Of notes. with
provision for a total of $500, ,Q00, 600
at any one time outstanding. -
The existing authority is for $7,-
se aoo oo he s,ador said and about
So,ooo,vVv,VVV VI SiStotS uOlCS anu
$311. 100000 of Treasury notes are
already outstanding Hereunder.
The additional authority Is neces-
sary in order to carry out the pro-
gram 1br dealing with the short-dated
debt outlined in my letter to you of
April 30, 1921"
Republican leaders explained that
it was not proposed to reduce actual
appropriations made by Congress for
this fiscal year. but to accomplish
most of the proposed reductions on
unexpended balances held by the va
rious departments.
Estimate Big Redpetion.
Members Of the committee estimat-
ed roughly that these changes would
result in a net reduction of 1855, ,0o0,-
600 in the total yearly tax bill This
is $45.000,000 below the estimate
reached at tho White House confer
ence, but 1t was explained that the
revenue from corporations
would be $45.000,00e greater than
heretofore reckoned by reason Of the
repeal OF the excess profits exemp-
ton of $4,000 plus an amount equal
to the 8 per cent of the invested capi-
tai for the taxable year.
The question Of Mghtenfng the bur
Continued on Pare 2. Column - !