Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-12-14
INHERITANCE TAX
ARGUED IN HOUSE
Long. Impending Battle Over
Repeal of Levy Opens
on Floor.
By the Associated Prose-.

BY the Associated Prose.
The long.standing battle over repeal
of the Federal inheritance tax broke
in the House today, with number
OF members demanding that the levy
be eliminated from the new tax bill.
An amendment was offered by Rep
resentaive merritt, Republican. Con-
necticut, to strike the levy from the
measure, and House leaders agreed
to allot two hours for its discussion,
Repeal of the levy was recommend
ed by Secretary Mellon to the House
WAYS and means committee. but that
body refused to carry out the Treas.
ury's suggestion in framing the new
measure.
Debated Subject.
Consideration of proposals for re.
peal OF the inheritance tax proved one
of the most controverted subjects en-
tering into the committees hearings.
Charges was made by a number OF
members that large sums OF money
had been raised by lobby in Wash
ington, supported by corporations, TO
bring about repeal OF the tax.
Chairman Green and Representative
Garner. of Texas, ranking Democrat
on the committee, Joined in opposing
all efforts to abolish the tax.
The Republican vote defending the
tax bill was pierced yesterday for the
second time by a Democratic attack
that hit directly at large corpora tons
which file affiliated tax returns.
The Democrats, by vote of lob to
1853, pu' through an amendment which
in effect would prohibit parent and
subsidiary corporations from filing ar
filiated tax returns on their earnings.
One Republican, Clifford Of Massachu-
sets, voted with the Democrats.
The proposal. like the one adopted
Monday, which would reduce the tax
rate for small corpora tons with a net
taxable income of $4,000 or less, Is
subject to another vote before passage
of the bill At that time the Demo.
Gratis can be called upon to sustain
their positions on a roll call vote.
Garner Stands rs Sponsor.
Both Of the amendments were spon.
sored by Representative Garner OF
Texas, the minority leader on the
House ways and means committee.
which drafted the revenue measure.
He said that one objection raised to
the amendment adopted Monday In
favor of smaller corporations was that
it would increase the total tax cut
proposed by the committee. Estimat.
ing hat yesterdays proposal applying
to affiliated returns would affect ap
proXimately $50 large corporations and
increase by $4,000, 900 annually the
Federal taxes they pay, he argued
this would benefit 20 per cent of the
corporations in the country.
Chairman Green declared that pro.
visions in the bill applying to afiiliat.
ed returns has been recommended by
the joint congressional committee on
internal revenue legislation, and that
they were by far the best that could
be worked out. He contended that
the large corporations. despite Gar.
ner's argument. wanted the provisions
eliminated and that the Texan really
was working for their relief
After the Garner amendment had
| been adopted an effort was made by
Representative Merritt, Republican,
Connecticut 10 obtain vote on a
motion looking to repeal OF the Fed
| eral inheritance tax.
A discussion Immediately ensued, and
| the House fnually agreed to post
pone until either late today or tomor.
| row vote on the question. which has
been one of the most controversial
| entering into present consideration OF
| tax reduction.
The ways and means committee. in
drafting the bill, refused, after two
days of public hearings. to accept the
Treasury recommendation that the
levy be repealed. and number OF
House members at that time indicated
they would seek TO bring the ques
ton before the House itself for de-
termination.
Held as infringement"
Merritt argued that the estate levy
constituted an infringement by the
Federal Government upon a field OF
taxation belonging TO the States and
that the Federal levy had been APP
proved only as wartime expedient
Chairman Green. who favors reten
ton of the levy, and Representative
Begg, Republican, Ohio. both con
tended the tax was not an invasion
of State rights.
The House adopted an amendment
offered by Green to provide that M
claims in abatement on income, wal
or excess profits taxes should be filet
lin respect to assessments msde after
the present bill becomes = x.