Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-02-25
MELLON APPROVES
NEW REVENUE BILL
DESPITE BIG SLASH
Secretary Confident Govern.
ment Can Meet Bills if
Care Is Exercised.
WARNING is SOUNDED
ON MORE EXPENDITURES
Compromise Passed by Senate $40,-
100000 Over Limit Set
by Secretary.
RI the Associated Press.

speaker 1ongworth and Vice Pres
Ident Dawes today signed the $751;
600 900 taX-reduction bill and 1t then
was transmitted TO the White House
by special messenger for the Presi-
dents signature. Speaker Longworth
signed the measure soon after the
House convened. 1t then was taken
% the Senate by a clerk for Mr..
Dawes to sign.
Although the new tax bill some-
what exceeds the reduction in reve-
1lne which the Treasury believed
safe. Secretary Mellon said today
that it is generally satisfactory to
the administration.
AS the bill now stands. the Secre-
tary said, the Government should
have little serious difficulty in meet
Ing it's financial needs. He explained.
however. that any appropriations by
Congress not now contemplated would
create a deficit.
The Secretary believed that the re-
troactive features of the estate tax
Will not cause embarrassment TO the
Treasury.
The 1927 fiscal year surplus will
be small. If there is any. in the opin-
ION of the Treasury head. but he
suggested that the revenue reduction
will have little effect on the current
fiscal year program. Such surplus
as is available for the current year
IS being applied to reduction Of the
public debt and that policy will con-
tinue to the end of the fiscal year,
June 80
Undersecretary Winston predicted
that the new bill should be produc-
tive of increased revenue in future
years. 1t has been proved, he de-
clared, that the lowering of the tax
levies was conducive to business eX-
tension and the opening up Of new
sources of taxation.
The undersecretary said present in
dications were for revenues somewhat
IN excess of expenses for the fiscal
year ending June 80. 1927-the first
fun fiscal year after the bill becomes
effective. He added, however, that
these calculations We're predicted on
retention Of the Government esti-
mate Of expenditures for the fiscal
wear
Enactment into law of the reve-
nue bill proposing tax reduction of
s387, 100000 this year awaited today
only the signature of President Cool
fdge, who was expected to approve
the measure within a short time
Senate approval late yesterday by
4 vote of 81 to 10 of the compromise
reached in the conference with the
House completed the work of Con-
gress on It's first and probably most
important piece of legislation this
session
The Widespread slashes in taxes
will become effective In most in
stances Immediately upon enactment
"f the measure and income taxpavers
VII have their assessment cut by
more than $200.o00.000 with the re-
huced rates effective on first pay
ments for this year. which are due
March IL.
Increase I'm Exemption.
More than 1900, 900 of the apnroxi-
mately 100000 Federal taxpayers
would be relieved of all taxation
through the proposed increases in
PERSONAL exemptions from $1,000 ro
$1,000 for single persons and from
$500 to $4,000 for married persons
fastening to complete the bill in
order to permit the reductions to he
effective with the first payments, Con
Sress sldetracted much other legisla-
ton and perfected the measure in al
most record breaking time, less than
three months after the opening of tho
session.
The demand for haste was needed
by leaders OF both parties in the
House and Senate and resulted in a
compromise in both branches between
the parties on the major provisions of
the bill.
inheritance Tax Fight.
The principal fight developed over
the inheritance tax, which the Senate
voted to repeal, but which was kent In
the bill by the House. which modified
the rates. In contrast to the two pre-
war, almost complete agreement was
reached between the party leaders on
the vital income tax schedules.
Both Republican and Democratic
leaders defended the measure in the
four hours Of Senate debate Yesterday
on the conference agreement. and a
proposal to rcomnit it to conference
Tor further tax reduction was defeated
on a point of order
Senator Neely. Democrat, West Vir-
Ginia, made this motion. which would
have instructed the Senate conferees
to insist upon repeal OF the taxes on
admission, dues and automobiles
Leaders on both sides argued this
would cause undesired delay, and
Senator Robinson Of Arkansas, the
Democratic leader. made the point
that the motion was out Of order, since
II would not provide means Of get
ting the bill back before the Senate.
Vice President Dawes upheld the
point of order and an appeal from his
ruling by Senator Neely was voted
down, 62 to 8. The roll cali on adop-
ton Of the conference agreement i'm
mediately followed.
The 10 Senators who voted against
The conference report on the bill were:
epublicans-Frazier. Howell, Nor
beck, La Toilette and Nye. Demo
crats-Blease, Trammell, Walsh and
NEhoe1er IT T.abor-ShfDStead a