Evening star., 1921-08-06
S33Q,OD0,o)D DROP
lin ESTIMATED j. S.
INCOME DISCLOSED
Enormous Shrinkage Shown
by Secretary Melons
Statement to House.
EXPECTED EXPENDITURES
ARE CUT ONLY S11,864, PIG,
Predicted Excess of Disbursements
Over Receipts Is Now Placed
at 1896, ,369,517.

A shrinkage in three months OF
$3.50. O.00O, 900 in the estimated govern
ment income for this fiscal year based
on the present revenue law is dis
closed by the statement recently pre-
sented to the House ways and means
committee by Secretary Mellon. The
total income is estimated now at
s4,e17.643.oOO as against the estimate
of $4.547, $4,000 contained in Mr.. Mel
Ions letter of last April 80 to Chair
man Fordney.
In the same time the estimated ex-
penditureS have decreased only $11,-
S64,216. The estimated excess of dis
bursements over receipts is placed
now at 1896, 6,369.517 as compared with
an estimate of s1s.234, ,033 made by the
Treasury last April.
Business Depression Felt.
OF the total shrinkage in receipts.
S130.o00.000 is charged to the expect
ed falling off in internal revenue,
largely as a result of the present
business depression. The remaining
S200.006,000 is accounted for by a re-
vision of the estimated amount to be
received in interest on foreign Obliga-
tions. In Mr.. Melons letter of April
80 this interest fund was placed at
25.026.O00 and was based on the as
sumption that several countries would
make substantial payments. The esti-
mate now is s25.026.000. most of which.
it is said, is expected to come from
France.
Analysis of the figures sent to the
committee Thursday by Mr. Mellon
shows that returns from taxes for this
fiscal year under the revisions sug
100000 less than the estimate under
the existing law. Miscellaneous re-
ceipts would be S5o,00O.0OO greater
under the revision than at present.
but it is estimated that there would
be S55.000.O00 decrease in the re-
turns from corporation income and
excess profits tax il the latter tax
were repealed as of last January l
and a fiat corporation income tax of
Is per cent substituted
Not to BE Felt at Once.
II the repeal were made effective as Of
next January l, however. the estimated
return from all taxes would be $50, ,009,-
600 greater than under the existing law,
as the returns from the corporation in
come and excess profits tax would be
approximately the same as under the
existing law.
1t is estimated by Treasury experts
that under the law as it now stands the
corporations would pay a total Of ST.
125. .0O0. 900. divided 1868. .000. 900 profits tax
and Sass ,00O, 900 income tax. Under the
REVISION SuSScSltu chSCtiNS last Jdhud1y
the corporations would pay $1.070.0O0.-
eco. divided, $413.000.00o profits tax and
:557, 200, 900 income tag Should the re-
ision be made effective as OF next
January 1 the corporations would pay
the same amounts as under the pres
ent law.
Difference of Opinion.
There is a decided difference of
opinion as to federal expenditures
and income for the fiscal year. Treas
ury experts and leaders of the House
are far apart in their estimates.
The House ways and means COM
mittee has before it figures prepared
by Chairman Madden of the appropri-
ations committee which are said to
show smaller probable outgo than
given in Secretary Melons statement
and considerably larger income.
House leaders also have prepared
their own estimates, and on this basis
of the whole they insist they can re-
duce taxes by half billion dollars.
Democratic leaders, on the other
hand, say this is not possible unless
there is to be a huge deficit at the
end of the year.
Representative Madden believes
Congress can be depended upon to
keep down expenditures I'VE have
got to keep our noses to the grind
stone" he declared.
Savings Estimated.
Discussing the probable income and
outgo this year, Mr.. Madden outlined
some of the ways in which he thinks
expenditures can be kept down and
others proposed for this year dis
tributed over several years. He de-
clares that the people ought not to
be assessed in a single year to pay
the $545,20e.000 to the railroads
under the transportation act and fed
eral control. adding that by spread
ing this sum out there would be
big reduction in estimated expendi-
lures this year.
Mr.. Madden also is of the opinion
that there should be some reductions
in the estimated $551,000,O00 expendi-
lures on account of the public debt.
AS to estimated income, the appro-
priation committee chairman declares
Treasury officers have agreed that
probably s100.000,000 more can be
collected on account of back taxes
than the $235.000,000 total given in
Treasury estimates. He also believes
that miscellaneous revenue for the
year would be larger than had been
estimated.