Evening star., 1925-06-16
HOPE FOR TAX CUT
IS SEEN IN SURPLUS
Receipts From Income Levy
! Indicate Excess of $3.50,
OOO,OO0 This Year.
BY DAVID LAWRENCE.

Indications today were that there
would he a surplus of approximately
$l50.000 900 at the end of the present
fiscal year
This is higher than any previous
calculation, and. though the figures
are necessarily unofficial Al this time
because all available data have not
been collected from the various in
ternal revenue districts. it may be
said. on reliable authority that the
budget surplus will come to the
$50. .000, 900 figure without question.
This surplus is far beyond expecta-
tions President Coolidge in transmit
ting the budget gave as the Treas
ury's estimate a surplus of s6S.000.0Oo.
THIS was considered too little on which
to base tax revision. Even in March
of this year. when it was apparent
that the receipts were larger than an
ticipated the Coolidge administration
hesitated 10 predict a big surplus, be-
cause many people paid their income
taxes in full on March 15.. and there
was no way to know what the June
installment would be without analyz
ing about 7,oN0.o0 individual returns.
an impossible task in such a short
time.
Retroactive Cut Discouraged.
So Congress was discoura ged. from
applying any retroactive tax cut. and
Treasury officials advised that the
country wait till June Is before be-
ginning to grow optimistic about an
other tax cut.
Meanwhile leaders in both the SEN
ate and House. knowing that Congress
even went further in economizing than
did the Executives recommendations
began to estimate the proba bic surplus
and talk of g tax revision. 1t has
however, been mostly talk Now the
definite figures are coming in.
From all the internal revenue dis
tricts and the Federal Reserve Banks
facts are being teleSra phed every day
which show q gradual increase in the
amount of tax receipts. BY the end
of this week the .Iune installment
data will be virtually complete, and
some announcement may be expected
from the Treasury as to the proba BILE
size of the surplus
The next tax cut will apply to the
money earned during the present wear
and VIII be felt by the taxpayer next
March.
Size Is Uncertain.
The size of the reduction that will
he granted cannot at the moment he
estimated accura tely. as an analysis
Senator Smoot's belief that there will
be S4o0 100000 surplus is regarded
here as conservative. II NAV go
above that. depending. OF course. on
what kind of business conditions pre-
vail for the rest of 1925.
Broadly speaking, a biz principle
has been vindicated in the data thus
far collected. Il proves that notwith.
standing the substant reduction in
tax rates granted in the last law
passed. the country prospered sum
ciently 10 pay almost as much income
taxes as before. Thus II the ra tes are
lowered again, officials think even
more taxsb Bile income will be reported
and that The government will get the
benefit of larger receipts. The cam.
paign for low. surtay rate has
already received a greater stimulus in
the actual figures on The latest returns
than it did in months of theorizins
argument, and ii is beginning to be
t..,Sn for granted now that all fac
lions Will agree on at least a 25 per
cent surtaX. And The Treasury NAV
recommend an even lower rate than
rs per cent.
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