Evening star. [volume] (Washington, D.C.) 1854-1972, 1922-02-02
SPECIAL: TAX HELD !: !:
|. CHIEF BONUS. HOPE
Secretary Mellon Presents
Estimates Of Amounts t. Il 8
Be Expected.

The soldiers bonus should be paid
out of special taxes, such as increased
first and second class postage and
tobacco levies. Secretary Mellon de-
clared today before the House ways
and means committee.
Secretary Mellon reiterated his be-
lief that it would be impracticable to
depend on the foreign debt for finance
ing the proposed 1--we way" adjusted
nue. from that source 1t predetermined.
Estimates of Revenue.
These estimates Of revenue from
special sources were made by the Sec
rotary:
One cent increase in frst-class
postage. $7o.Oo0,ooo.
Increased second-class postage to
wipe out deficits in that branch Of the
Post Office Department, $30,000.000.
Increased cigarette tax OF 80 cents
on the thousand. $25.O00.0oo.
Increased tobacco tax. cents a
pound. $5.000.O0O.
Increased documentary stamp taxes.
$40.000.0OO.
a tax Of cents on each bank check.
$50. 100000.
A license tax Of so cents a horse.
power on automobiles. $1O0.OO0,000
The total estimated returns from
these taxes was $30O,000,O00 Mr.. Mellon
said the bonus would cost $425.000.0O0
year for the first two years. and
told the committee that 1t could ex-
tend the list of taxable sources to
70 L. hA lAa~
clear that he was not. recommend
Ing any Of the taxes suggested.
Opposes Sales Tax.
The Treasury Secretary opposed q
general sales tax on the ground of
the cost and difficulty Of administra-
ton. Il should say that we cannot
increase the taxes already in exist
ence," said Mr.. Mellon. las they al
ready are as burdensome as should be
borne. We should go further and find
some broad class Of a commodity on
which reasonable taxes would not be
too great a burden.
II think that the use of the foreign
debt for this purpose would be inn
practicable. The foreign debt Is a
very uncertain proposition. and to I'M
dertake to use 1t for this purpose
would lead to a great many Difficult
ties. It is problematical whether
funds can be obtained within the time
to meet the bonds.
Uncertain What II Would Yield.
ut would be much better for us to
provide the funds and collect the for
eign debt as possible than to pledge
that source for something when we
don't know what the source will yield.
Anyhow, this would be q cumber-
some way of raising money for the
bonus. and in some respects would
cost US more than the other way. for,
IL we undertook to sell the foreign
securities, they would not bring as
much in the market as our own secur-
tiles. In other words, they could not
be sold at par"
Questioned by Representative
Frear, republican, Wisconsin, as to
the basis for the estimate Of q cost
of $3.50. 000, 900 for the bonus tho first
two years. Mr.. Mellon said this was
on the assumption that half Of the
former service men would take cash.
Its all speculative" said Mr.. Mel
lon. mo one can tell accurately how
much it. will cost"
Mr.. Frear asked the Secretary as
to his views on various special taxes.
The Secretary objected to any further
changes in the tax on the transfer Of
stocks and bonds, declaring it would
retard business.
After the committee had conferred
today with Secretary Mellon regard
ing the bill. Chairman Fordney said
action would be deferred until he
could consult with the executive.