The Washington times., 1924-02-23
TAX CUTS KILL
BONUS, SAYS
MELLON
Sscgstary Sticks to Former
Contentious in Reply to
laGuardia.
BY A. o. HAYWARD
International Newn Service

Secretary of the Treasury Mellon
took another crack at the soldiers
bonus today.
In a letter to Congressman
EtorellO H. LaGuardia, Insurgent
Republican Of New York, Mellon de-
clared that any of the tax reduction
plans under consideration by Con:
greEs would cut the Government 3
ldlcofne so Lon that no money would
be available tospay q bonus.
! LaGuardia had asKed Mellon for
additional revenue figures in view
the adoption of the Democratic
tGarner) tax plan, already approved
by the House in lieu Of the Mellon
plan, would so deplete the nation
pocketbook that there could be no
bonus without the levying Of new
taxes to raise the necessary money.
The Republican insurgents want
both tax reduction and a bonus,
so they are talking Of new COM
promise with the Republican regu-
lars to put through income tax rates
to yield the desired revenue.
Mellon Keeps Position.
Secretary Mellon lost no time in
throwing cold water on this scheme
and in making it clear that ne
had not retreated from his original
position that no bonus is possible
II taxes are to be reduced.
After quoting the various losses
to the Treasury under the several
tax reduction plans, Mellon said:
1T is obvious that the bonus can
not be paid within the estimate
surplus IL any Of the three plans is
plus justify the payment Of such
bonus II any Of three plans were
changed in the respect Of making
the normal tax rate per cent and
s per cent and the sur-tax rates
graduated up to 40 per cent, which
are the figures specifically mention
ed by you.
"You ask me what rates would
have to be adopted in order to pay
this bonus. You have the estimated
figures before you. It is obvious
that II all tax reduction be fore.
gone a certain amount Of revenue
would be available to the Govern
ment for such purpose as might
be determined. II any plan OF tax
reduction be adopted and additional
taxes of other character be i'm
posed, the effect on the Govern.
ment's revenue could only be de-
termined when the specific nature
Of the proposed taxes was given.
/ regret that unless you can pre-
sent some comprehensive plan by
which you propose to raise the
necessary money, or In what
particulars you propose the taxes
shall not be reduced, am unable
to give. you specific figures
Bonus Bloc to Fight.
In the face of Melons renewed
fight on the bonus, the soldiers
bonus bloc" in the House started q
drive this afternoon for o vote in
the House on the bonus next week.
At meeting Of the bloc today a
committee OF five, headed by Con.
gresham Fitzgerald (Rep.l, Of Ohio,
was instructed to tell Republican
Leader Longworth that bonus legis-
lation should be brought up in the
House Immediately after the tax
bill was disposed of next week.
The soldier bloc IL solidly behind
the Mckenzie adjusted compensa.
ton bill which is identical with that
vetoed by the late President Hard.
ing. Only a few minor changes
are necessary to bring this meas.
ure UP to date. They are insisting
there Is no need for further hear.
ings on the bill before the House
Ways and Means COMMITTEES and
that the bill can be brought from
the committee into the House as
soon as the tax bill has been
passed.
Chairman Green Of the Ways and
Means Committee expects to get
final vote on the tax reduction bill
next Tuesday. There will be a
joint session Of House and Senate
next wednesday for the Harding
Continued on Page 2. Column 81