The Washington times., 1924-02-22
c. 0. ?. TRIES To
COMPROMISE.
ON TAX
Old Guard Bargains With In
surgent Republicans on
Normal Rates.
By A. c. HAYWARD.
International News Service,

Regular Republican leaders were
bargaining today with insurgents
on tax legislation with q new COM
promise offer consisting of and
per cent normal taxes and S7l1
per cent maximum surtax o.. the
income taxes.
The insurgents presented some
days ago as basis for compro-
mise and normal taxes and 40
per cent maximum surtax. When
this was rejected by the regular
Republicans the insurgents rejected
the Mellon plan of and 6 per
cent normal and Is per cent maxi
mum surfaces and helped write
into the tax bill the Democratic
plan of 2 and 4 per cent normal
end A per cent maximum surfaces.
The new compromise offer re-
duces by per cent the Mellon
rate Of per cent on taxable In
comes up to $4,000 and increases
12h per cent the Mellon maximum
surtax of 25 per cent on incomes
Of 500, 900 and over. The per cent
normal is retained on incomes from
$4,000 to $4,000 when the surtax
of l per cent starts.
Republican Leader Longworth
said the cut of the lowest normal
from to 2 per cent would reduce
receipts about $40, 000, 900, and that
1t would not be safe from the stand
point Of the Treasury to reduce
the per cent normal to per
cent. He insisted that the Demo
cratic normals Of and per cent
with other tax slashes would result
in Treasury deficit Of $500, O0O, 900.
The compromise proposed to win In
surgent support carried with 1t no
sacrifice in the principle OF the
Mellon bill, Longworth insisted.
IL Insurgent G. o. p.
There were seventeen Insurgent
Republicans. one Farmer-Laborite
and one Independent who swung to
the Democratic plan in preference
to the Mellon plan. Republican
leaders hope by their new COM
promise proposal to win nine or
ten of these back to the Mellon
plan and so put through a Repub.
lican tax reduction bill. II they can
muster the votes the substitution
will take place when the tax bill
comes up for vote on final passage
through the House.
Chairman Green, Of the Ways and
Means Committee, announced that
in no event will the bill be put on
passage before next Tuesday. This
assurance was given to enable New
York and other nearby Congressman
to go to their homes for the week
end. Green wants the bill out OF
the way before next Thursday
when he has a speaking engagement
in Boston. There remains much
work to be done on the bill, and
many important additions to 1t will
be attempted by Frear wisconsin,,
leading tax insurgent; Garner and
other Congressman.
The bill was changed yesterday
by the addition OF new provisions.
Chairman Green secured adoption
Of an amendment which Brought
under the general income tax rates
the gain resulting from exchange
of stock, or gains had from the
liquidation Of a corporation. Elk
emption from taxation was allowed
beneficial mutual local insurance
companies. operated without profit
and whose only collections are from
members to pay losses and expenses,
and for farmers or other hail, cy.
clone, casualty or fire insurance
companies, mutual ditch or irriga-
ton companies, mutual or co-opera-
tive telephone companies, or like
organizations, but only If substan-
TALLY all the income consist Of
amounts collected from members
for the sole purpose Of meeting
losses and expenses.
Frear Amendment Loses.
The Insurgent- Democrat coalition
held together to enable Freer to get
a vote on his proposal to tax un.
distributed profits Of corporations.
His amendment was ruled out of
order by Chairman Graham, who
Is presiding over the session. Frear
and Nelson, Insurgents, and Moore,
Democrat of Virginia, insisted the
recent modification Of House rules
had for its leading purpose restora-
ton to members Of the right to
propose such changes to tax legis.
lation. They insisted on a vote to
override the decision Of the chair
man, and the coalition won out.
Most OF the DEMOCRATS later voted
against the Frear amendment and
It was defeated 10 to 81.
Moore met with defeat for an
amendment which would have re.
quired the filing with income tax
returns Of all political contributions
to candidates for Federal office and
imposition Of a tax of 100 per cent
on all such contributions in excess