Evening star. [volume] (Washington, D.C.) 1854-1972, 1925-12-20
SENATE TAX BILL
CHANGES UNLIKELY
Prompt Action Is Expected
on House Measure in
Upper Branch.

The tax reduction bill probably will
become law much as it passed the
House The Senate will amend II
in some particulars, it is expected,
hut in the main the important fea-
lures of the House measure are eX-
peCted TO be retained in the bill as
it, will be passed eventually by the
uDper house The Senate amend
ments will be considered in confer
Cnce where the House has as much
weight as the Senate.
Threats against the tax measure
have been voiced in some senatorial
quarters. But it was generally au
mjtted Yesterday there was no dis
posirion undulv TO prolong debate in
the Senate. The bill will become law,
il was said. in ample time to permit
the income tax returns to be FLED
under the new st...ute on March 10.
Seek Greater Reduction.
Democratic Senator's are intent upon
INCREASING the total tax reduction from
t6S $S25 100000 figure OF the House
bin 70 s450, 100000 or S9o0,e0O,OOe.
They propose to do this by extending
TIE period over in which the public
debt of the United States, due TO the
war, is to be liquidated. They would
make this period 80 or 40 or even so
years. instead of % years as planned
by the administration. BY so doing
they would reduce the amount of rev
enue needed now for eXtinguiShinS
the debt. They contend that by such
a course it would be possible to re-
duCe still further the taxes, and JUS
tify it because of the 62year period
Z u.
Tie their debts to the United States.
~Se Democrats, however, will get
IifDa comfort or aid from the pro-
St.ss've Republicans in this fight.
The progressives, like the regular Re
publicans, are impressed with the
need of paying off the war debt as
Speedily as possible. in order to save
bilious of dollars of interest which
20; have to be paid if the payment
perl0d We're extended to so years, for
example.
Other principal contests in the SEN
ate over the tax htn will have to do
with the SurtaX rates on incomes and
the rates on estates. The House cut the
maximum surtaX rate from the 40 per
cent of the present law to 20 per cent.
II also cut the maximum rate on es-
tstes from 40 per cent to 90 per cent.
some OF the progreSSiveS on the Re
publican side will seek to have the
surtaX rate on incomes raised 10 25
o. 80 per cent. or even higher They
also VIII support a return to the pres
eEt rates on estates. While there will
be considerable Democratic SUPPORT
Tor these proposed amendments to the
House bill. there also will be Demo
cratic opposition. 1t is believed that
a sufficient number of Democratic
votes VIII support the cut of the sur
taxes 10 70 per cent to insure the
retention of the House provision
The fate of the estate tax amend
ment, however, is more in doubt.
democratic Senator's would also re-
yfse the rates on incomes ranging
from 100000 to $4,000. holding that
the House rates rest too heavily on
such incomes when compared to the
higher incomes.
II they could have their way and in
crease the total tax reduction from
1925 200, 900 to $500 900 900, the Demo
Gratis say, they would reduce still fur
Their the rates on the lower incomes
and remove all the so-called nuisance
taxes, some Of which have been Topped
off in the House bill.
Has Gone Too Far.
There is a feeling on the part of
some of the Republican members of
the Senate finance committee that the
House has already gone too far in
reducing taxation. particularly when
ii is considered that probably $685.
600. 900 will be needed for a public
buildings law, and that there will be
a postal deficit amounting to nearly
S5O,00G,0OO. An effort will be made
TO restore some of the taxes on tobacco
and industrial alcohol which have been
cut in the House bill, in order to raise
more revenue. One member Of the
committee favors a return to the
lower income tax exemptions Of the
present law But the House exemp-
tons VIII prevail.
The House bill repeats the publ
city clause of the present income
tax law. Around this repeal will be
staged a sharp fight in the Senate,
though the supporters of the repeal
are hopeful of carrying the provision.
In any event, they hope that it will
prevail in conference. Party lines
will be broken in t~e> particular
fight, with some of the democrats.
including Senator Pat Harrison of
mississippi, supporting the repeal.
Some Of the progressives on the
republican side will demand the re-
1ention of the publicity clause.
Senator Smoot, chairman of the
finance committee, will call his COM
mittee together January to begin
consideration of the tax bill. He
said yesterday there would be no
public hearings, although senators
would be permitted to call witnesses
before the committee if they desired
further information on particular
matters.
The House hearings, he pointed out
had been very full and the Senate
committee planned to use them. He
predicted that the bill would be re-
ported to the Senate by January 20,
and that it would pass finally in time
to permit the filing of income tax re
turns under the new rates.