Evening star., 1928-12-20
PAPER DEFICIT HIT
AS GARNER ERROR
Treasury Officials Term
Forecast of S75,O0O,0OO
Shortage MiSapprehension.

There will be no deficit for the
Federal Government at the end of this
fiscal year despite present paper" indi-
cations to the contrary, in the opinion
of Treasury officials.
This was indicated today following
submission to Congress of tax refund
deficiency estimates aggregatnig $75000,-
900, which on the basis of the Presi-
dents budget would show a deficit now
The Treasury also declared the asser-
tions in this connection Of Representa-
tive Garner of Texas, ranking Democrat
on the ways ana means committee, were
based on misrepresentation or the facts
.a~.G Gamer had selaafgeds zina the House
yesterday that the Treasury should
have put off longer the proposal to re-
fund the 100000 in back taxes. In
answer to this, it was said at the
Treasury that interest of 6 per cent
runs on all back tax refunds from the
time the tax was paid to within 80 days
of the date of the refund check It
would, therefore, be a loss to the Gov
ernment to delay payment of refunds,
Treasury officials said.
The Treasury figures were declared
by both Secretary of the Treasury
Mellon mad Undersecretary Mills to be
correct. In the opinion of the Secre-
tary himself the Treasury has the re-
sponsibility and is computing its figures
and reporting officially to Congress,
while Mr. Garner is merely making
statements, and he has not the re-
sponsibility to meet these back taxes.
nx..;ss;o,, ~ V4ov,a
AS a matter of fact one explanation
understood to have accounted for the
large size of the SIS 5,000000 back tax
refund item was that final figures
reached the Budget Bureau too late to
be included in the original budget mes
sage. A difference Of opinion appears
to exist as to the responsibility for this
omission.
The paper" deficit, which Under
secretary Mills is confident will be
turned into surplus, was reached
when the $75,000,000 refund item OBJ
liberated budget estimate of $37,000,-
600 surplus for the present fiscal year.
Firing a veritable broadside at Secre-
tary Mellon and charging that he has
given back more money to the taxpayers
than all the secretaries of the Treasury
in American history, Mr.. Garner's ad-
dress yesterday was regarded by many
persons as the opening gun in his cam
paign not only to gain the Democratic
leadership of the House in the new Con-
gresS, but to break precedent by also
retaining his place on the committee,
which handles all measures dealing with
tariff and taxation.
Mr.. Garner said the United States
Steel Corporation would receive $685.
nm in toV wit
year through settlements with the
Treasury. He said he had been in
formed that If other cases of that cor
poration were settled on the same basis,
the Government would have to refund
between S25,000, 900 and $30,000,000 ad-
ditional to the steel corporation.
Fifteen million dollars of these re-
funds, according to Mr.. Garner, were
included in the estimates for this fiscal
year, and IF settled on that basis, this
one company alone will be settled with
to the extent of $4,000 900 to $3O,000,-
600 more and be paid this year."
Referring to the proposal to return
$75,000,000 in back taxes this year, the
Texan asked whether it would not be
better to put it off little longer.
might Not Have a Chance"
''There is something in the back OF
his head" continued Mr.. Garner, con-
tinuing in his attack on Secretary Mel
Ion, Ito the effect that after the 4th
of March he might not have chance.
I don't know whether that is it, but
do know this, that he is in great haste
to settle these cases that have been
pending for IL years 1t would seem
to me that he could have let it go over
just 80 days more, and let new ad-
ministration do some of the refunding
in the place of the old. 1t might have
been advisable"
The Texan began with the compare
lively mild declaration that the Secre-
tary of the Treasury in issuing state
ments of the conditions of the Nations
finances makes his reports to fit his
views on pending legislation" and
wound up with the charge that the
Secretary seemed to be administering
the estate and graduated income tax
laws in such a manner as to bring a
demand for their repeal.
1--WE know that he is not in SYM
pathy with them," Garner declared,
"and it seems that he is making them
SO obnoxious that he hopes to have
them repealed, to go to some system of
taxation that he thinks better. don't
want to see it.
"It is a good law and II ever it is
repealed it will not be on the merits
of the law. but because of the demerits
of those charged with its administra-
tion...