Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1924-01-29
DISSIPATION DROVE HIS
DAUGHTER TO SUICIDE, WORD
HEAD HUB RESERVE BANK
FAVOR Is PER CENT
REDUCTION IN TAX
ON EARNED INCOME

Washington. Jan. 2s.-Income tax
payers got their first slice Of the pro-
posed tax relief today when the House
ways and means committee adopted the
recommendation of Secretary Mellon to
allow a special 25 per cent. reduction
earned"
All taxable incomes under $4,000 were
defined as earned for purposes of this
reduction, while $4,000 was set as
the maximum amount of incomes on
which the reduction could be taken.
Treasury estimates show that about
lS,000000 taxpayers have incomes of
less than $1,000. and automatically
could deduct from their tax when COM
puted 2o per cent. of it's total. Thus a
married man with two children who
now pays tax of SIS on an income of
$4,000 would pay only S2o.50, this fig
ure not taking into account any nor
NAL income tax reductions-a PROPOSE
tion still before the committee.
Disposition of this section of the
bill cleared the way. with the eXcep-
tfon of some odds and ends to be taken
up tomorrow. for consideration by the
committee of the incomes rates them
selves. including the surfaces. the
| main point at issue in the tax revision
program
A majority of members of the COM
| mittee met late today to discuss q pro-
| gram Of procedure but agreed only to
meet in full committee tomorrow.
Some members have declared for writ
| ing a proposition income rate sched-
| u!e while others wish to work out the
rates in full committee. Democrats
| however, have declared they will
stand solidly for their party proposal
| of a reduction in surtaxes to a A per
cent. mex:mum instead of 20 per cent
as suggested by Secretary Mellon. The
| House Republican steering committee
also discussed tn tax situation today
but reached no conclusions.
Before taking up the earned in
come provision the committee def
nitely rejected Secretary MELONS
proposal to prohibit husbands and
wives in the eight community prop
| erty law states from dividing their in =
comes for purposes of taxation.
Chairman Green had submitted a
substitute proposal. the original al
ready having been defeated. to pro-
! hibit this division when the incomes
were derived from wages or salaries
; alone. Representative Garner, Dem
is6cf6t, Texas, and Hadley. Republican
| Washington, led the fight against
| this section.
| Secretary Melons recommendation
, for special reduction of the taxes on
earned income provided for the %
| percent rate to apply on such in
I comes of any amount and defined
earned income as that received from
| wages. salaries and professional ser
| vices. Representative Garner, au-
| thor of the Democratic tax plan. ac-
! cepted the earned income proposal
, in his plan but suggested n reduction
! of 33 1-3 percent. The % percent
F.. rate, however, will stand in commit :
| tee. Chairman Green said. because no
| amendment was offered to change it
On earned incomes above $4,000 the
! definition of Mr.. Mellon also will
| hold. Mr. Garner moved today to
| define earned income" rs reason
/ able compensation or allowance for
| personal service where income is de-
: rived from combined personal service
and capital in the prosecution by un-
! Incorporated persons of agriculture
! or other business" This was de-
| feated by a strict party vote and the
motion of Representative Mills. Re-
J publican, New York, to declared all
incomes under $4,000 as earned
adopted.
| In setting 4 maximum amount of
earned income for the deduction
the motion of Representative Tread
| way, Republican. Massachusetts, pro-
posing $4,000, was adopted.