Evening star., 1924-03-12
MELLON BROADS|DE
DEMANDS REVISION
OF HOUSE TAX BILL
Senate Committee Told Def
icit of $3.50, 900, 900 In.
voIved in Measure.
DEMOCRATIC SENATORS
ASSAlI- COOLIDGE PLEA
Cut In 1928 Rate by Saturday
Deemed Unlikely by Party
Leaders.

Leaders.
While Secretary Mellon was firing
broadside today at the revenue bin as
passed by the House, Senate democrats
turned their big guns on the Presidents
message urging a joint resolution tc
make tax reduction apply to incomes
payable next Saturday.
Meanwhile, with only three days left
for action such as the President rec
commended, the leaders showed little
disposition to start on such course.
Deficit Is Foreseen.
Mr.. Mellon told the Senate finance
committee the bill as it now stands
must be changed to prevent Treas
ury deficit, and he gave the committee
a long list of notifications which
would be necessary, in the view of
Treasury experts.
In the Senate the question of Mr..
Coolidge's message was brought up
by Senator Robinson of Arkansas, the
democratic leader. who said he be-
lieved Mr.. Coolidge knew it would be
quested in the time av, liable. He
charged the President meSsly wanted
a free hand to veto the b
Action Deemed Unlikely.
Senator Reed, democrat, Missouri,
said the President probably had been
fully occupied with cabinet troubles,
and Senator Mcclellan. democrat,
Tennessee, suggested recent news
paper articles calling atter tion to the
failure of Congress to act upon any
part of the legislative program out
IN, ha IDpn nr% fircr
might have impelled the tardy appeal.
Senator Glass, democrat, Virginia;
Brookhart,' republican, Iowa and
Edge, republican, New Jerse-, we're
cluded, leaving conviction that
there was not the slightest hope OF
action on the Presidents request.
The Presidents special message
urging the passage prior to March 10
of legislation reduction for the calen-
dar year 1923 income taxes 20 per
cent comes too late" Senator Robin
son said.
Recalls Garner Proposal.
Several months ago, in the body
at the other end of the Capitol, the
ranking democratic member of the
sentative Garner of Texas, realizing
that the bill to provide for the re-
duction of federal taxes would oc-
casion prolonged consideration and
could not pass in time to afford relief
for the calendar year 1928, sugsesIsa
and urged the passage of a separate
measure to reduce the taxes for the
year 1923. The President did not then
think enough of the suggestion TO
take any action.
1T would be interesting to know why
he has waited so long and how far
political considerations prompted the
message. Had such a message been
received thirty days ago. action could
since the Constitution requires
that bills for raising revenues must
originate in the House, it is not pos
sible to take any action here, other
wise an effort would be made to have
the Senate proceed to the considera-
tion of a measure for the reduction
of taxes for 1923"
Deficit Of s4sO,ooo,oO0.
Revision of the revenue bill passed
by the House must be made to pre-
vent d Treasury deficit, Secretary
Mellon today told the Senate finance
committee.
The House bill would mean a loss in
revenue of about s450.ooe,080, Mr..
Mellon said, against an estimated
surplus of s3s5,ooo.ooo for the fiscal
year 1925.
The Secretary condemned the Long
worth compromise on the income tax
rate schedule and criticized House
amendments which increased estate
taxes, created a gift tax and opened
tax returns to inspection by congress
sional committees.
Some Increases Needed.
Some notifications would be nee
essary also, he said, in the increases
ordered by the House in the excise
and miscellaneous taxes.
Mr.. MELONS views were sought by
the committee preparatory to the con-
sideration of the rate schedules in the
bill The Secretary and Undersecre-
tary Winston are asked to further
amplify their statements before the
committee later this week.
The estimated surplus of $4,000
600 in the fiscal year 1925 was based
Mr.. Mellon said, upon a reduction in
ordinary expenditures from approx
mately $4,000, 100000 actual in 1923
to S3,050.000.000 estimated in 1894 ans
$2.S15 100000 estimated in 1925.
This reduction in expenditures
he said, will require persistent ef.
fort and economy. and IL extraordi-
nary Liabilities are incurred by the
government, then it is obvious that
the estimated surplus cannot be re-
lied upon
The Secretary also warned that this
surplus would decrease in the follow
ing years unless the bill, as it now
stood, was corrected.
Your plan of taxation" he said,
must be sound in its essential fea-
lures, and not destroy the source OF
revenue"
Referring to the Longworth surtax
rates, which made fiat 25 per cent
reduction on the rates in the pres
ent law, Mr.. Mellon declared "this
might have been all right if the rates
had been properly scaled in the 1921
law, but the bill simply continues
the defect in that law and penalties
principally middle incomes"
Little hope was held out today for
immediate action on the proposed
resolution providing for a % per cent
cut in income taxes payable this
year, specifically requested of Con-
gress in a message yesterday by
President Coolidge.
Chairman Green of the House ways
and means committee, which would
have to take UP such legislation FIRST,
declared yesterday 1T would be i'm
possible to get the resolution through
both houses of Congress, before Satur
day, when first installments must be
paid on income. taxes. The revenue
bill passed by the House provides for
this retroactive reduction.
Both Chairman Green and Repre-
sentative Longworth, republican lead
er, argued that as unanimous con;
sent agreement would be necessary TO
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