The New York herald., 1922-01-14
Leaders i'll House Prepare
Measure to Replace One
Passed in May, 1920.
AGAINST A BOND ISSUE
Levy on Wines and Beer Not
Regarded Likely for Rev.
enue to Pay Soldiers.
Special DiSpdtch to. TIE New York HrsAtp
New York Herald Bureau.
WnShinofnn ~ To.

New, York Herald Bureau,
Washington, ID. c.. Jan. I3 /
president Harding made it known
to-day that he is opposed to the pas
sage of any soldier bonus bill which
does not provide sure method of
raising the money without delay. To
pass any other kind OF bill. in TIE
President's opinion, would not be an
act of good faith. With the Repub-
lican leaders agreed that bonus bill
shall be passed by this Congress. the
Administration is at present leaning
toward a general sales tax to defray
the cost.
1t was made known officially at the
White House to-day that the Presi-
dent will not oppose sales tax if it
is offered in Congress for this pur-
pose. He has been impressed with the
growing sentiment in Congress and
throughout the country for this sort
OF levy.
Because of the uncertainty whether
any large sum can be realized in the
near future from the allied debt to the
United States. either on the principal
or interest, the President has set him
self against the plan to defray the
cost of the bonus from that source.
Base Plan on War Debt.
Republican leaders In the Senate have
worked out a scheme whereby the sl1.-
600 200 900 owed to the United States by
Great Britain, France and other allied
nations would be funded by the negotia-
tion of bonds which would be under
TO the American people. the proceeds
TO be used to pay the cost of the bonus
But Congress has not yet passed the
bill authorizing the Secretary of the
Treasury to fund the foreign debt, nor
is there any certainty up TO this time
that foreign Governments will fall i'm
line with such plan.
The question OF marketing securities
Of this character in the United States
also Is a serious one. 1t Is not be-
lieved the public would purchase them
from purely patriotic motives, as they
did Liberty bonds during the war.
THE NEW YORK HERALD learned to-
House are preparing to bring from the
Ways and Means Committee within
few weeks bonus bill which will en-
body the compensation features of the
measure passed by the House May %.
1920, but instead of the variety of new
taxes provided In that bill. which were
70 be known az Victory taxes ii is
expected a simple sales tax plan would
he included In the measure. the revenue
from which will be applied exclusively
TO the bonus.
Senate and House leaders are agreed
on the main compensation features and
no trouble on that score is expected
Many Plans to Raise Money.
Various suggestions for raising the
money by some method other than a
sales tax have been discarded as inn
practicable. 1t is conceded that It could
be obtained from a tax on light wines
ana beer IL Congress could be induced
70 amend the volstead law to raise
the alcoholic content of those beverages.
But there Is not the slightest evidence
that Congress- would do any such thing.
The drys have too firm n grip on Con-
grcss. A proposed Federal tax on gaso-
line also has been discarded.
Republican leaders arc by no means
certain that a sales tax would be APP
proved py Congress even for this pur-
p6sc. But many of them are coming TO
tue conclusion that in no other way can
the war veterans get bonus. Since II
has been determined as "a matter OF
party policy that ~ bonus bill is TO be
passcd. they can sec no other feasible
way out of the difficulty except "A Fed
real bond issue, which does not meet
With favor either on Capitol Hill or at
the Treasury Department.
3The new bill which will be passed
Will give to each Army. Navy and Ma |
rine Corps veteran below the grade |
q fcaptain five options. The first will |
10 a cash bonus of 81 day for |
each days service in the United states |
and s1.25 a day for each days service |
overseas. minus sixty days, this deduc-