The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1927-10-31
Secretary Of the Treasury
Places Maximum Figure
Even Lower Than Previously
Estimated Argues For
Continuation of Auto Tax.
Wartime Excise and Miscel.
lanoous Tax


submitted follows:
]. Reduction Of the corporation
tax from Is 1-2 per cent to IL per
cent.
2. Extending permission to cor
porations with net income Of $685.
600 or less, and with not more than
10 stockholders, to file returns and
pay the tax as partnership or COR
porations 1T their option.
3. Revision of surtax rates ap-
plying on individual incomes be-
tween $4,000 and $4,000.
4. Repeal of the estate tax.
s. Exemption from taxation of
the income derived from American
bankers accounts held by foreign
central banks of issue.
Wants Auto Tax Retained
Contrary to expectations, the
secretary opposed any change what
ever in the remaining war time ex-
else and miscellaneous taxes. He
argued at length for the retention of
the present three per cent levy on
automobiles and the 10 per cent tax
on admissions applying to tickets
selling for more than Is cents on
the ground that these duties and the
excise tax ON tobacco should be kept
Sin the interest Of q well-balanced
tax system"
The administration program con-
templated no further reductions in
the normal income rates applying to
individuals nor any further increase
in the exemptions allowed individ-
uals, which propositions have been
the battle grounds Of past revenue
legislative fights. Nor is any re-
duction along these lines now
planned by congressional leaders.
1929 Surplus Is Basis
Arguing for the limitation Of the
total tax cut to $225, 100000 in the
face Of surplus Of $685. ,O0O, 900 for
the last fiscal year and q prospec-
tive margin Of $455, 600, 900 for this
year, Mr.. Mellon insisted that the
basis for the reduction must be the
surplus available in the fiscal year
1929. This, he said, is estimated at
$274, 100000.
The secretary frankly admitted
that "for number of years past the
treasury estimates have under-esti-
mated revenue that was later real
ized," and recognized that the argu-
ment may be made again that the
estimated surplus for 1929 is too low
in view Of the big margins Of last
year and this year.
Anticipating the demands which
will be made for larger reductions on
the grounds that the estimates of
the surplus for 1929 are too low in
view Of the fact that past estimates
have always been low, the secretary
denied that the under-estimates in
the past were the result Of "deliber-
ate intention or policy"
No Concealed Surplus
"Every effort to avoid . repetition
Of this result" he said, "has been
made in preparation Of the estimates
here presented. 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.
'If tax reductions are made or
appropriations voted on the assump-
ton the present figures understate
probable future receipts, response
bility for such reductions or appro.
priations must be assumed by those
who advocate them. The treasury
has placed the probable receipts at
the highest figures compatible with
the most dependable forecasts and
facts.
"As far Is expenditures are con-
cerned, the estimates have been fur
nished by the bureau Of the budget.
It should be remembered that esti-
mates do not include any expendi-
lures that may be incurred by rea-
son Of new legislation. The trea-
sury believes that tax reduction
should not IN any event be in excess
Of approximately 1926, ,000, 900"
While normal receipts and expen-
ditures were calculated to be ap-
proximately the same for this year
and the next, the difference between
the estimated surplus Of $466, ,O0O,-
900 for this year and 1874 .OoO, 900
for next year was accounted Tor
largely by an estimated reduction OF
4256. .0o0, ,0OO next year in special re-
ceipte. including those from back
tax collections over those received
this year.