Douglas daily dispatch. [volume] (Douglas, Ariz.) 1903-1961, 1927-11-01
House Committee
Continued from Page One)

prospective surplus u pfOo'"OoOV ~
1923 and an actual surplus OF
$685., 100000 for the fiscal year 1927.
Upon this basis and assuming that
tax revision bill becomes a law
prior to next March Is. Mar. Mellon
said. The reductions will only affect
the revenue for the last six months
OF 1928, but will apply to the III
u months of 1919, and therefore, it
is the surplus for 1877 that must be
considered.
While Mr. Mellon, ACCOMPANIED to
the committee room by Under Sec
rotary Ogden Mills, who in the last
congress was a member of the ways
and means committee, admitted the
treasury in recent years had erred
in estimating prospective surpluses. he
argued this had resulted from revenue
derived from homecoming IourceS.
He explained the treasury estimated
that the same current receipts would
be available in 1929 as in 1928, and
as were actually collected in 1927,
adding that "there is no. evidence
available to Justify the assumption
that they will be larger but there are
certain definite indications that they
may be smaller" The treasury hopes,
however, he continued, that the UNI
favorable factors will be offset by the
normal growth of the country
Apparently taking cognizance of the
already announced democratic plan
for tax reduction of between $400,0O0,-
600 and $5OO.0O0,O0O and also of state
ments by democratic leaders thai in
och froo ncfiy1o tpc ALWAYS
have been too low, Mr.. Mellon said
that under estimates were not the
result of deliberate intention OF
policy"
every effort to avoid a repetition
of this result" he declared, "has been
made in preparation Of the estimates
presented here It would be unWar-
ranted and unwise to assume that in
the present estimates there is any
concealed surplus. In these figures,
the treasury has not consciously nor
as matter of policy played safe"
The secretary said if tax reduc-
tor or future appropriations were
voted on the ground that the treasury
estimates were low, that those advo-
eating such measures must assume
responsibility for the result.
Gas far as expenditures are con-
cerned,' he continued, "the estimates
have been furnished by the bureau
of the budget. 1t should be remem-
! bered that estimates do not include
any expenditures that may be in
Cured by reason of new legislation"
/ Mr. Mellon said he realized great
! pressure would be brought to bear
| - I0 70
on automobiles, but that he could
not agree to the advisability of such
a step. Pointing out that federal
appropriations for roads will reach
ST., 100000 in the fiscal year 1928,
and $75,000000 in 1929, he declared
/ that these expenditures were "for
the direct and immediate benefit OF
automobile owners who, he added,
should make some contribution in
return" r9.
Taxes paid by railroads were men
toned by Mellon, as another reason to
Justify the automobile tax, because
''the automobile is the railroads chief
competitor"
| 'Is it quite fair" he questioned, ITO
ask the railroads to contribute to the
construction and maintenance of the
roads on which their rivals operate,
while exempting the latter from any
contributions"
Referring to excise taxes in general,
the treasury secretary said he thought
those on tobacco, amusement admis-
sions and the few stamp taxes should
also be retained, declaring that "it
is difficult to imagine more ideal
10 &H0 1+i71Oci6c
seats at the recent Dempsey Tunney
fight" which amounted to 1894
"TIe revenue yielded from that par
ticular fight was $242,O65.74," hi
said.
Mr.. Mellon argued that removing
the tax on rs cent theater adj
missions would eliminate the tax OF
the recreation and amusement of al
overwhelming majority of citizens anc
that "Uhose who pay more than z!
cents can well afford to make {
. contribution to the government
He estimated that reduction Of thu
corporation tax would decrease rev
enue by approximately $135,0O0,00C
and permitting smaller corporation
: to file returns as partnerships woulC
! deprive the government Of between
$3O,OOOoOO and $35,0OO,0OO annually
! Revision of specified surtax rates, h
said, would mean about $50,00o,00
}. less in revenue and repeal of thu
estate tax would result in about ;
: $7OOOO0O loss.
> In suggesting reduction of the cor
). poration tax, Mellon observed tina
i corporations have received virtuaIl
s. no tax relief since 1921 and tina
: business conducted under the cor
porate form is today overtaXed a
compared with individual enterprise
and partnerships"
Discussing surtax rates, the seqre
tary recalled the revenue act of 1872
benefited. small and larger taxpayer
somewhat more than those who's
e taxable incomes run from $4,000
i, $4,000 In view of that he advocate
d revision of surtaX rates in tn
IS intermediate brackets which woul
in effect reduce taxes on income
n. between $4,000 and 100000.
,e "By the simple expedient of &C
| i1,eti,,nr Do4o II ri,