The New York herald., 1921-04-09
THIS Is HARDING PLAN
Announcement Made After
President Discusses Situ-
alton With Cabinet.
MELLON SEES pENRosE
Treasury Department TO Fur
nish Senate Finance Commit
tee With Data on Needs.
spscial psspate. y TnE sew YoHN LIEaAlD

New York Herald Bureau,
Washington, ID. c., April D.
Revision of the entire tax system
with the repeal OF the excess profits
tax and a determined effort to avoid
imposition of any additional taxes as
substitute was the plan indorsed by
President Harding and his Cabinet to-
day. Congress will carry out the
wishes of the executive branch of the
Government to the last degree possi-
BILE. TIE programme of tax revision
will be inaagurated by hearings De-
fore the Senate Finance Committee
after the extra session opens next
Monday It will be followed by action
in the House at the earliest oppor-
tunity after the passage OF the new
tariff legislation.
Any Doubt that may have existed as
to the intention Of the Republican Ad-
ministration TO repeal the excess
prof.ts tax was removed by Mr.. Har-
ding to- DAY following the meeting OF
the Cabinet 1t was disclosed that tax
revision had been discussed and the
President let 1t be known that he had
in no wise changed his views since ne
supported during the campaign the
platform pledge of his party TO repeai
the unscientific and burdensome tax
on excess profits.
In,mediately after the Cabinet meeting
Secretary of the Treasury Mellon Went
directly to the office of Senator rem
rose (Pa). chairman OF the rinaies
Committee. and there conferred Win
him and senator Watson Qnd.). mem
her OF the committee, regarding the
proposed tax revision programme. SEN
ator Knox participated in the early uis-
cussion. which lasted about two hours.
Secretary Mellon made no statement
although he admitted that his talk win
the members of the Finance committee
related almost entirely to tax matters.
Dr Adams. one Of the financial experts
from the Treasury Department, was
called in for consultation and advice.
II was agreed that the Treasury shall
furnish a complete statement to the
Finance Committee so far as that is
possible of the exact condition OF the
Government Treasury. the prospective
income that may be estimated from
various sources, how the income VIII be
affected by the changes to be made In
the laws and what the precise require
( nents of the Government are to be.
while our meeting to-day was in
formal, I regard IL as of great value
and Importance Senator Penrose SAID.
TT is the first time that the Secretary
and I have had any prolonged exchange
OF views over tax revision, and 1t Is
bound to be very helpful"
Senator Penrose was asked IL the Sec
retary had made any specific recon-
mendations on tax legislation, but said
he could not speak for the Secretary,
who would make his views known later
IN formal recommendation to Con-
gress.
Secretary Mellon said he was very
glad TO learn Of the programme of the
Finance Committee and expressed his
Willingness to cooperate in every pos
sible way" continued Senator Penrose.
He agreed as TO the desirability of tax
revision and the gathering and submis-
sion to Congress of information as to
the resources and needs OF the Treas
ury. Treasury experts will begin at
once to assemble the data. and will be
prepared to present II to our committee
not later than May /. In my opinion
this W.T. be the first time In years that
such information has been presented.
Senator Penrose said there might be
some slight inaccuracies In the survey
OF the Treasury situation to be presented
the uncertainty regarding appropriations
that will be sought in the Army and
Navy bills which failed last session, and
must be reenacted before July /. He
stressed the necessity for economy and
the cutting OF appropria tions to the bone
and advocated the abolition of many
useless boards and commissions.
Tn my judgment the appropriation
for the Army and Navy should be re-
duced to the lowest possible minimum
consistent with the maintenance of their
organization" Senator Penrose added.
Il would look on those branches of the
Government as | would on any indus
trial establishment which is for the
time beng inactive. Expenses must. be
cut to a low point consistent with pre-
serving the organization.
No sane man contemplates the pos
sibiifty OF a great war in the lifetime
or the present or the next generation.
and, therefore. we should reduce defence
appropriations. although with due regard
TO purposes or national defence"
Senator Penrose repeated his state
mcut that the hearings on tax revision
would begin with the sales tax and
be followed by those who wished TO talk
on the excess profits taxes.