The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-05-02
TO
SUPPORT own
TAX BILL
Sen. Simmons to Have Almost
Solid Vote Of Party for
His Measure
By WILLIAM K. HUTCHINSON,
international News Service.

INTERNATIONAL News Service.
Democratic opposition to the
Mellon plan for reducing Federal
taxes swung into action in the
Senate today when Senator SIM
mon of North Carolina, minority
finance leader, formally offered
a substitute schedule for the tax
rates proposed by the Admins
tration.
Forty Per Cent Maximum.
The Simmons plan, based upon a
minimum normal tax Of per cent
cent would offer larger reductions
to the small taxpayers and impose
heavier rates upon large incomes
than those proposed by the Mellon
schedule.
A consensus Of opinion indicated
the Simmons plan would be adopted
by the Senate with the ultimate
rates-as enacted into lava COM
promise between the Democratic
substitute and the Longworth bill
which was passed by the House.
These two measures vary slightly
In rates, the House bill stopping
with a maximum surtax OF 37k
per cent. The differences, however.
can easily be lroned out in con-
ference.
Mellon Plan Doomed.
The Mellon plan practically was
doomed to defeat even by the ad-
uninistration leaders who sponsored
It. Both Senator Smoot (Rep.l OF
Utah, chairman Of the Senate
Finance Committee, ana Senator
Curtis Rep.l of Kansas. announced
they did not hope to enact the ad-
ministration measure. At the same
time Democratic spokesman de-
clared they would pass the Simmons
schedule. An attempt by insurgent
Republicans, led by Senator Brook
hart Rep.) Of Iowa, to enact higher
suYtaxeS-ranging up to OO per
cent - was likewise doomed to
failure. ,
The Simmons schedule, like the
iIongworth bill, would start with a
10 per cent normal tax on incomes
nm to $4,000 and o normal tax of 4
per cent ON incomes between $4,000
and SR. Thereafter the normal
tax. as In the LouSworth measure.
would be per cent. These rates
would give the small income classes
greater reductions than the Mel.
ion nIan. because the latter would
start its normal taxes at per
cent on incomes up to $4,000 and =
per cent thereafter.
nnOn
but one thing-the point where sur
taxes begin. All three would place
a 1 per cent surtax on incomes
above $40 900, but thereafter the
three sliding scales vary. The Sim
mons and L0ngworth plans both
benefit the smaller taxpayer more
than the Mellon plan, but the latter
would give greater reductions to the
larger income classes than either
Of its rivals.
Scales Cross at $4,000.
In its sliding scale. the Simmons
plan Of surtaxes would cross the
Melons schedule at the bracket
including incomes Of $4,000, giving
greater relief than the AdministrA-
ton bill to incomes below that fig
ure and larger taxes to incomes
above that sum. At the leval of
800 900, the Mellon plan would be-
gin its maximum surtax Of 26 per
cent, whereas the Democratic sub.
stitute would impose a surtax Of
81 per cent. slightly higher even
/ than the Longw0rth rate. In actual
money, the Simmons plan would
tax an income Of 100000, just
81, 800 more than the Mellon plan.
The Democratic maximum Of 40
per cent would begin with incomes
of 100000 and in this respect would
exact greater tribute from the in
comes Of the nations richest men
than either the House bill or the
Mellon plan. AS the House max
lmum Of 37M per cent becomes
effective above 100000, the differ.
ence between this measure and the
Democratic substitute on the high.
est brackets would not be much. In
actual money, the Simmons plan
would tax an income Of $500, 900
about $4,000 moro than the Mellon
plan.
Tax Exempt Securities.
Before any vote can be reached on
the Simmons substitute, the Senate
must first dispose OF the proposal
to place an indirect tax upon the
so-called tax exempt securities
through elimination Of q provision
permitting interest payments on
loans to be deducted from income
tax payments wnen the borrowed
money is invested in tax-free securi.
ties. Although q vote on this
proposal would test the strength Of
the Mellon plan itself, indications
pointed to it's defeat.
In order to speed UP consider
alton of the bill, the Senate will
meet tonight with leaders looking
To a final Vnfa early next NAek.