Evening star. [volume] (Washington, D.C.) 1854-1972, 1924-02-03
DEMOCRATS FIRM
ON SURTAX LIMIT
May Modify Normal Income
Tax Rate Proposed in
Garner Plan.


Democratic leaders in the House,
confident they can muster enough
votes to upset the surtaX schedule
carried in the Mellon bill, declared
yesterday they would make no con-
cessions on the "A per cent maximum
they favor. It was indicated, how
ever, that they might modify the
normal income tax rate proposed In
their substitute.
Representative Garner OF Texas.
ranking democrat on the committee.
announced he had asked for n new
set OF Treasury estimates. They
would apply. IL was indicated to
normal tax rates and possibly the
proposed earned income exemption
out not to surfaces or the recon-
mendation for an increase in the tae
exemption for both unmarried Der
sons and heads Of families
Would Decrease Loss.
A Treasury estimate that the
Garner plan would mean loss of
revenue to the government of
sS4S,000.000 annually, as against
s2ss,oo0.o0o under the Mellon bill. ia
understood to have Influenced some
democrats to believe that shift in tho
normal rate might be advisable to
cut down the total To what extent
this might be done, however, WAS
not disclosed.
confidence of the democrats that n
majority of the House will NOT lima
up In favor of the % per cent surtax
maximum proposed by Mr. Mellon Law
chiefly in the announcement of Rem
resentative Frear Of Wisconsin. 70
publican on the ways and means COM
"iteee' that ne and other insurgents
would not go along with the republi-
can organisation on this point.
Predict G. o. II. Split.
Democratic leaders predicted ,h..
At least thirty republicans would
swing to their support when a. show
GOWN comes on surtaxes - enough
votes. they pointed out, to insure
adoption Of their schedule.
Some republicans, however. ex-
pressed the opinion that a compro-
mise on figure below the demo-
cratic maximum might be arreed
upon TO Keep enough republicans in
line to insure rejection of the Garner
rates.
Inc ways and means committee was
not In session yesterday and probably
will not meet until the latter part Of
next week to dispose of odds and
ends before reporting the revenue
Dill. not later than February H. Re-
publican members, however. will con-
Ter tomorrow on some sections. in
Guiding the tentative amendment
providing for a rs per cent fiat reduce
ton on personal taxes paid this Year
on 1923 income.
Mellon Assails Garner Plan.
The proposed tax reduction plan of
House democrats would result in a
loss OF revenue on income taxes alone
OF more than $610,o00.0oo. according
10 Treasury estimates made public
IN a statement last night by Secre-
tary Mellon and based on prospective
conditions in the period in which
they would actually apply. Added to
the $1l0,00o.000 loss In revenue in the
miscellaneous tax reductions already
voted by the House ways and means
committee, Secretary Mellon said, this
would mean a total reduction of $780,
100000 and a governmental deficit
would be the result"
Previous estimates by the Treasury
OF the loss of revenue under the in
come rates proposed for the demo-
Gratis by Representative Garner of
Texas. based on the 1921 returns, do
not show at all what would be the
actual loss OF revenue in other years"
Mr.. Mellon said, inasmuch as 1921
was year Of low personal income"
The estimate on the 1921 basis was
fa47.o0o,ooo.
For the period in which they would
actually apply. the loss of revenue
under the Garner plan on both income
and miscellaneous taxes would be
almost twice as much as under the
Mellon plan,' the Secretary said.
estimating the total loss under the
latter plan at s332,00O,00O.
mo expected governmental surplus
could meet the loss Of revenue desired
by Mr.. Garner. and a deficit would be
the result" Mr.. Mellon said.
RIDDLES PLEA REJECTED