The Birmingham age-herald., 1924-02-01
REPORT FAVORS LITTLE CHANGE
 IN MELLON BILL
Action Of Committee Means Certain Fight On
 Floor For Amendments


 This was assured~today when repub- licans on the House ways and means Committee approved the surtax and income tax schedule recommended by { the treasury. Despite differences an surtax they have agreed to stand to- eether in the face of democratic op- position. Nl-..
 Surtax rates, the bone of conten. fion between democrats and repub- licans and among the, republicans themselves, came to a vote after ma jority members of the committee had discussed the whole situation with the republican steering committee.
 Meeting alone later they first re- jected, by II to vote, proposal to make the maximum surtax rate 32 per cent instead of 25 per cent on incomes in excess of $1O0,OO0 as sug- gested by MT. Mellon.
 By the same vote, the Mellon sched- ule was approved. Chairman Green of Iowa, Representative Timber lake of Colorado and Mclaughlin of Michigan are understood to have cast the three negative votes. The eleven who voted in the affirmative are said to have been Representatives Hawley. Oregon; Treadway, Massachusetts {; Young, North Dakota; Tilson. Con necticut; Bacharach. New Jersey {; Hadley, Washington Watson, Pennsyl- rania; Mills, New York; Kearns, Ohio; Chindblom, Illinois; Crowther, New York. Frear, Wisconsin, an in- sergeant out of sympathy with the treasury's surtax recommendations was not present.
 Floor Fight Assured
 Report of the Mellon bill to the House undoubtedly will precipitate an extended floor fight in which amend ments under the modified rules will be in order against all of the rates.
 Representative Longworth of Ohio, Republican floor leader, who previously had urged a compromise on the sur taxes in committee and who conferred with the ma jority members just prior b their action, said he had reached the conclusion that it was probably best to report the rates proposed by Secretary Mellon and had so informed them today.
 While republicans of the committee { are pledged to support in committee the rates agreed upon today they are free to support other provisions when the bill is taken up in the House.
 Representative Garner of Texas, au- thor of the democratic tax plan, has declared his party would vote as a unit to amend the bill in accordance With the rates he proposed.
 The republican insurgents who boiled 17l. votes consistently against Speaker 3Gillett in the organization fight also have declared they will not support the Mellon rates.
 Mir. Longworth said it was unlikely that a republican conference would be called to discuss the tax bill before 1t reached the house. Pointing out that members of the party could not be bound by majority vote in such a tc6nference to support the measure.
 Other members of the steering com mittee, who met today with the re- publicans of the ways and means com mittee during their all-day discussion of the income schedules included Speaker Gillett and Representative Graham of Illinois, Sinnott or Oregon, Darrow of Pennsylvania. and Sanders, Indiana.
 Four Changes in Original Bill
 Acceptanee of the Mellon income rates will place the treasury bill be- fore the house with only the following changes of importance:
 Rejection of the proposed joint tax on community property; limitation of the reductions for earned incomes restriction of the repeal of taxes on theatre admissions; modification of the proposed board of tax appeals, and special reductions in taxes to apply on those payable this year.
 The prop6Ml to reduce taxes pay able this year, which was approved yesterday by republicans of the com mittee upon motion of Chairman Green was supported today by Secre- fary Mellon. wpho said the estimated loss to the government of about $200.- QQlD0Q from a flat reduction of p per cent on. .all income taxes of 1923 could be met The plan, he said, was feasible. and practicable.
 The democrats also moved in this direction today when Representative Garner introduced a joint resolution, proposing to make reduction in the 1925 taxes on the basis of rates put forward in the democratic plan, which would reduce the normal income taxes to two per cent on incomes below xo,0OO to four per cent on those be- tween $j,OOO and $S,000 and six per Y |. increase the exemptions for unmarried persons from $1,000 to S2.000 and of naarried persons from S2.500 to S3. .OOO
 Mr. Garner argued that the joint resolution could be acted upon March 15. when the first installments on in. come taxes are due and thus would save about two million persons making returns this year. Under the Green plan the reduction is made part of the revenue bill with the provision that if approved after March 15, re- funds could be made on oyer-payments Declares Garner Plan Unavoidable
 MT. Green objected on the floor to- day to Mfr. Gamers request for i'm mediate consideration of the joint reso- < htion. Later he issued a statement in which he declared the proposal was simply desperate move for political purposes. MT. Green further stated that the plan was unavoidable from an administrative standpoint as the taxes return had already gone out and many paid and that if the scheme were adopted it would entail an entire new set of tax return forms Moreover he said the. treasury could not stand the estimated loss of $300,000,0 900 in revenues which the plan would entail.
 With adoption of the rate schedules republican, members of the committee will continue in private session the remainder of the week MT. Green said to work out details. It was likely. he said that the full committee would be called in. by next Tuesday, when the rates will be approved formally by the majority and other details of the bill fixed. The measure is sche- duled to be reported to the house on February II.