Evening star., 1925-11-06
S400 OFF for Dependents.

This takes into Considera ton the
increased exemptions as we'll as the
reduced rates. The committee also
voted To allow the S400 exemption
for dependent if child between the
ages of IS and u years is in school
II is impossible to estimate the re-
duction over $4,000 until the new
surtaX schedules have been prepared.
The committee which is framing a
new tax bills, rejected proposals, to re-
peal the capital stock tax and modify
the corporation levy of 1219 per cent.
Suggestions that more corpora tions
be allowed to file as partners and that
partners in some instances he allowed
TO file returns as corporations were
turned over to a subcommittee.
BY extending the limit to which the
earned income credit may be applied
it was estimated taxpayers would be
saved $1,000, 900 annually.
The committee voted also to make
the graduated SurtaX rates begin at l
per cent on the amount of income in
excess of $4,000. The scale up to
the 90 per cent maximum on the
amount of income in excess of 500 100
is to be worked out
More than 5000, ,000, 900 of the an
nual burden of 1000. 900 Federal in
come taxpayers would be removed
under income rate reVisions voted by
the House ways and means commit
tee in preparing a new revenue bill
The committee yesterday voted a
reduction in the maximum surtaX
rate from 40 to 20 per cent. pared
down the normal rates and increased
the personal exemptions.
BY increa sing the exemptions from
81 900 to $500 for single persons
and from $1,000 to So 500 for married
persons the committee relieved more
than 100000 persons IN the small
income class from the necessity of
paying any tax as we'll as reducing
the burden of all others on the Fed
eral tax rolls.
In deciding also to retain present
provisions of the law allowing %
per cent reduction on earned in
comes. the committee reserved de-
cision on the question of increasing
the present income limit of $40, 900
to which such reduction applies.
Cuts All Along.
The new normal rates voted by the
committee would reduce from per
cent to ll2 per cent the rate on the
first "a 900 of taxable income cut
from per C"ht to 3 per cent the rate
on the htN' S4.OUO, with a per cent
levy instead of the present per cent
applying on taxable income in excess
of $4,000
While no votes of the committee on
any of the changes were announced
by Chairman Green. it is understood
party lines disappeared and compare
tive harmony prevailed throughout
consideration of the income schedules
considered as the heart of the revenue
law. with a similar accord in prospect
in disposing of other features of the
bill.
The maximum surtaX rate approved
by the committee is that proposed by
Secretary Mellon, and the normal
rates, taken with retention of the
earned income provision, are along the
lines suggested by the Treasury, al
though it favors removal of the latter
provision because of difficulty in its
administration.
In absorbing more than 5000, 900 900
of the $500. 1000. 900 surplus available
for tax reduction on the income tax
reductions, the committee is believed
to have shut the door to any recon-
mendation for repeal of the estate or
inheritance tax, which would mean
loss of more than 500. 100000 an
pually. Reduction of the inherita nee
rates, however, probably from 10 to
90 per cent, Is still under considera
ton.