The Washington herald., 1921-08-10
White House Conference
Decides to Slash Ex-
penditures.
PLAN is TO AVOID
ANY EXTRA LEVIES
Congress Likely to. Take
Recess After Passing
Revenue Bill.


An actual reduction in taxation
became a certainty last night as a
result of an agreement reached at
a conference between President
Harding and Republican leaders of
the House 20 offset sweeping
slashes in revenue and approprra-
tions estimates
A program was framed calling for
a revenue bill which will raise only
,s,o7s.oo0. 900 from internal tax
alton, or a reduction of s495. 900
from the total of S3.75o.o0o.oov
which. according to the latest
Treasury estimates. would be the
yield of the present law during the
fiscal year 1922.
Cats MELONS Estimate.
The total to be raised from all
sources, including customs ana
miscellaneous. but not including
postal receipts. will be s4.os4.ooo.-
900. or a reduction of s516.00o.ooo
from the estimate Of s4,55O. 1000. 900
made by Secretary OF the Treasury
Mellon in his statement to the
House Ways snd Means Committee
last week.
The cut of {S16.0O0.Ooo represents
the total cut OF government expen-
ditures agreed upon at the White
House conference called by the
President upon his return to WASH
lngton-
Aim to Avoid New Taxes.
Republican House leaders won out
n their program to keep expendI-
lures down so as to avoid the i'm
position Of new taxes. As a result
Of the agreement. the proposed new
taxes. such as the SO tax on auto
mobiles, the 2-cent stamp on bank
checks. and 3-cent postage will be
unnecessary.
The slashing of expenditures
will also make possible a decrease
in the nat corporation income tax
which has been proposed as a sub
stitute for the excess prort tax. The
fat tax will be 12a per cent in
stead of 5 per cent. as proposed.
The present nat tax Is 10 per cent
The present $4,000 exemption OF
corporation incomes will also be
retained. according to present In
dications.
Mellon Agrees to Plan.
Those present at the White
House conference included all the
Republican members of the Hose
Ways and Means Committee.
headed by Representative Fordney.
the chairman. and Speaker Gillett.
Republican Leader Mondell. Repre-
sentative Campbell. chairman of the
Rules Committee. and Representa-
tive M.dden. chairman of the Ap-
proprfations Committee. Secretary
Of the Tre-Isury Mellon also partici-
mated and concurred in the agree
ment to cut expenditures and rev.
enues-
Earlier in the day the President
conferred with Senator Lodge. Re
publican leader of the Senate. and
Senator Curtis. Republican whip.
relative to plans for a recess. As
4 result OF the conferences both
Houses are expected to recess i'm
mediately after the passage of the
revenue bill by the House. Presi-
ient Harding was anxious to have
the administration railroad bill.
broadening the powers of the War
Finance Corporation. passed before
he recess but appeared content
With assurances that 1t would be
passed Immediately after the re
cess.
Predicts Passage by August 20.
Republican Leader Mondell de-
cIared that the House would pass
the revenue bill probably by Sat
'urday, August 20. Chairman Ford
ney Of the Ways and Means Com
mittee gave assurance that the bill
would be completed this week and
ready for the consideration of the
Republican House caucus next
Monday. II will be formally re-
ported to this House by the middle
of the week.
One of the agreements Of the
conference was that the original
program of making the revision of
the income tax provisions of TIE
law effective on income of the CAL
dar year 1891 shall be adhered to.
This means the repeal Of the ex-
cess profits tax as Of January I,
1921, and the reduction of the
higher brackets of income surfaces
as of the same date. The increase
of the fat corporation tax will be
made effective as of that date also.
Cuts surtax to 81 Per Cent.
The maximum surtax rate will
be cut from So per cent to 80 per
cent as of January 1. 1921, and to
25 per cent on January 1. 1922,
The lower surtax taxes will not
be increased as proposed by the
Treasury Department. Normal
taxes on individual incomes will
remain at their present level.
The transportation taxes will be
cut in ! ah on January 1, 1922. and
repealed entirely on January l..
1923.
1t issposs!Sle that tobacco taxes
NAV be increased somewhat. al
though this has not been decided
definitely.
Lasker's Request Reduced
One of the first steps toward ef-
fecting tax reduction was made yes
terday when the House, appropria-
tions committee decided to reduce
the Shipping Boards request for
s1e5, ,000. 900 to sfs.500.000. This was
part of the committees policy to
hold the board's appropriation to
s1oe.oo0.oo0 for the current year. al
CONTINUED on PAGE THREE.