Brownsville herald. [volume] (Brownsville, Tex.) 1910-current, 1928-05-13
GARNER RATE
IS RESTORED
BY SENATOR'S
Graduated Scale For
Small Corporations
Is Voted; Two Re-
publicans Assist

WASHINGTON, May 12.-tF)---
Senate republicans held the main
plank Of their 2O0,000,OO0 tax re-
duction scheme in the revenue bill
today in obtaining a u 21-2 per cent
corporation tax but only after dem
ocrats had uraet their program
earlier by voting into the bill
graduated scale of lower rates or
corporations with small incomes.
AS on previous votes in the tax
contest, the divisions today were on
party lines. The 12 1-2 per cent
corporation rate was put into the
bill over the III l-2 per cent figure
approved by the house by a vote OF
40 TO "a. The present corporation
levy is Is 1-2 per cent.
Each one per cent reduction in the
corporation tax involves $s2, 900 600
and had the democrats been success
full today i'm their fight for retention
Of the ii 1-2 per cent rate they
would have virtually won their fight
to increase the proposed $200,OO0,-
600 reduction to 1926, 100000.
As IL was, S24,000,000 was added to
the $2O0,000,000 reduction provided
by the republican bill when the sen
ate accepted the graduated scale OF
rates on corporations with incomes
Of $4,000 and lsss. Lining up sell
idly for this proposal, advanced by
Senator Simmons, democrat, OF
North Carolina, dRmocrats received
the support Of two republicans
Norbeck and McMaster. Of South Da-
kota-and won by vote of 40 to 90.
Surprised by the first break in
his ranks, Senator Smoot Of Utah, in
charge of the republican fight. an
nounced he would ask for another
roll call on the graduated scale OF
| corporation rates which was foster
ed in the house by Representative
Garner, democrat, of Texas.
Senator'S Harrison OF Mississippi.
and Walsh OF Massachusetts,, car
ried the attack for the democrats
today on the graduated scale or
rates for corporations, arguing that
1t was only fair to allo wlower rates
for corporations with small incomes
IN place of the flat tax now imposed
on all corporation incomes. This
was challenged by Senators Smootr
and Couzens, republican, Of Michi-
gan, who contended the change
meant discrimination.
The Garner rate schedules which
were restored to the bill provide for
tax Of 5 per cent on corporations
with incomes Of $1,000 and less: ?
per cent on incomes between $1,000
and $4,000; and per cent on in.
comes between $4,000 and $4,000.
The regular flat rate would apply in
incomes above that amount.
New provisions were added i'm the
senate 70 this tax proposal, however,
which would take care of incomes
Just above each Of the arbitrary
limits so as not to make a corpora-
ton with an income Of $7,00l pay ~
much as a corporation with an in
come Of $4,000. The provision
would pro-rate on such margins Az
that.
Disposition or the corporation tar
fights left only one other important
change in the bill proposed by the
republicans to be decided upon
downward revision Of the surtax
rates applying on intermediate in-
comes. Here again the democrats
| will seek a greater reduction than
| proposed by the republican majority.
The contests today developed an
other round Of oratory. Democrats
unleashed their heaviest assault on
the republican demands for limits-
ton Of the tax reduction to $780,
| 100000. Senator Harrison recalled
that in the past treasury limitations
have been ignored and that always
actual surpluses were far above es-
Inmates.