Evening star., 1927-10-23

~ would fasten upon a small
IA group Of corporations the bulk
II y of the income taxes paid
throughout the United States
has been worked out by Chairman
Green of the ways and means com.
mittee. Minority Leader Garner has
indorsed the idea. 1t will be pre-
sented to Congress and at the moment
appears to be the outstanding tax
revision proposal, with better chances
Of passage than any other, although
it may possibly be upset in the Senate.
Under the Green-Garner program
there would be no cut in the present
corporation rate of 1914 per cent, FOR
the reason that the prospective Treas
ury surplus for the coming fiscal year
Is not large enough to warrant adop'
ton Of Mr.. Green's idea and rate re-
duction, too. For the same reason,
the total elimination Of the automobile
excise and other so-called nuisance
taxes could not be accomplished. Nor
would the surplus permit the repeal
Of the Federal estate tax, urged
by business interests generally and
recommended by the Legislatures OF
more than 30 States.
The Green-Garner plan, briefly. pro.
vides for raising the exemption now
allowed corporations from $4,000 to
S25, 1000. For some time past experts
of the committee have been calcuiat-
ing what such a move would cost.
The latest figures indicate that the
plan, if adopted. would decrease Fed
eral revenues by about 1925, 100000.
That figure Is in excess of the entire
estimated surplus for the coming
fiscal year, put by the President at
about $215, 100000. Thus it would ap-
pear that adoption of the program
would preclude the enactment OF any
other form of tax reduction.
X n X X
In it's tentative form, the proposal
provides for lifting entirely the Fed.
eral tax on corporations whose net
income is $25, 200 or less. That means
that 10 corporations out Of every IL
In the country would go tax-free so
far as the Federal income levy is
concerned. There are approximately
45O, 900 corporations engaged in husi-
ness in the United States and fewer
than 10000 have net incomes exceed
ing $4,000.
Among those 10000 prosperous cor
porations one finds virtually every
name listed on the New York Stock
Exchange. This group, more than
any other, has been active in work
Ing Tor a lower corporation Tdte.
Apparently they are doomed to dis.
appointment at the next session OF
Congress.
What they would get, instead Of a
rate cut that would mean millions in
lower taxes to some of the large con.
Germs, is a tax reduction of about 3d.
100 apiece. That figure represents
the amount by which their income
taxes would be lessened by raising the
exemption from $4,000 to 5000.
Under the surface the program
has aroused vigorous opposition on
the part of some Of the larger cor.
porations. A concern of the magni.
tude of the American Telephone &
Telegraph Co., for instance, would
stand to get a tax reduction OF
about $1,000.0O0 IL the present rate
were cut only per cent, or from 1914
to 12h. IL the cut were to 10 per cent,
as proposed by many organizations,
such a corporation would get re.
duction of about $3,500,000 in its tax
bill.
Under the Green proposal its taxes
would be reduced only $3,100. some
what less than one one.thousandth
part OF what it had hoped for.
General Motors under the proposal
to cut 70 10 per cent would obtain