Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-12-30
MANEUVERONTA TAX
DIFFICULT TO STOP
Democrats, Held Blocked by
Mellon and Smoot, Play
for Delay.
By DAVID LAWRENCE.

Secretary Mellon and Senator Smoot
have executed a maneuver with re.
spect to the tax bill, which will be
very difficult for the Democrats to
upset. And the maneuver Is aimed
at the Observation-Disclosures coalition
which was getting ready to cut taxes
even more than the House did.
Anticipating that the Senate might
take the House bill. which calls for a
$3.50. 600 900 cut, and 60 further and
further toward the $500 .000.000 figure.
which SO many Democrats have set
as their goal. the Treasury has be.
come convinced that the only way to
win the battle of the estimates" IL
to let the March Is income tax pay.
ments come in and see what drop in
totals results from the rather adverse
conditions that existed in many lines
Of business during the calendar year
1927.
Eager to Boost Expenditures.
But there's another powerful factor,
and that In the eagerness OF Congress
TO spend more money than the Budget
Bureau provided. The Mississippi
food problem, which affects Demo
cratic Senators very vitality. has not
yet been settled. The administration
probably would never confess that 1t
10 hitting the Democratic Senators a
body blow by Withholding the tax bill
beyond March IS and forcing them to
agree on the amount OF food appro.
priations early in the first quarter of
1923, but that has been the construc.
ton placed on the Mellon letter.
From the viewpoint Of the Treasury
there never has been any good reason
for haste in making the new revenue
law. It's always better TO know what
the March Is figures show as to tax
receipts, officials contend, and no hard.
ship will be incurred, beca use IL the
figures are in excess of estimates the
new law can provide for rebates on
1927 payments. The difficulty is. how.
ever. that once the taxpayer has sent
in his first instailment and made out
his tax return he Is usually inclined
TO dismiss the matter. At least that
Ii the attitude OF corporations which
close their books with December 81.
1927.
Cut Effective March Is.
There IL still q considerable senti.
ment in Congress for making the cut
in corporation taxes effective as OF
January next. instead Of last January.
| but the bill as now written would
make II effective with the income tax
payments on March Is II the measure
were passed by that date. The likeli.
hood now In that IL Will not be passed
| on that date. though a resolution TAX.
ing care Of the corporations may be
introduced and pressed. 80 az TO save
| the Treasury the money involved In
administering refunds-a clerical Job
Of no small expense.
The Democrats have been planning
to amend the House bill in many par.
ticulars. Senator Smoot. who has the
habit Of knowing accurately what
sentiment In the Senate In from time
TO time. came 10 the conclusion that
unless a counter offensive were start
| ed the administration would find itself
with a very unsatisfactory tax bill
| II, on the other hand, the figures or
March IS are surprisingly good. the
delay gives both Secretary Mellon and
| President Coolidge a graceful exit
from the incorporating position
| they have taken with respect 10 the
| 3z25, 900 900 tax cut. which they sci
| as maximum.
tcopyrght, 1877