Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1929-01-18

by an almost strict party vote, the Re-
publican majority in the House of Repre-
sentatives last week voted an additional
appropriation of S75.000.O00 to be paid
out in tax refunds, chiefly to large corpor-
ations. This will run the total of tax
refunds made during the Harding Coolidge
administrations up to more than $780,
100000. At the same time, the Republi-
can House majority voted down an amend
ment offered from the Democratic side to
prohibit the use of any part of the APP
preparation for paying any axrefund claim
in excess Of $4,000. The purpose of
this amendment was to subject large tax
refund awards to the scrutiny of Congress
and not permit their payment on the single
authority OF Secretary Of the Treasury
Mellon or some bureau chief responsible
only to him.
Huge appropriations for tax refunds be-
gan in 1921, the first year OF the Harding
administration, when a refund appropria-
ton Of approximately $22,000,OOO was
made. They have kept climbing until for
the year 1929 the appropriation for this
purpose is approximately 100000.
These refunds are of taxes collected by
the Government during the administration
OF President Woodrow Wilson. During the
debate on the subject, Democratic Members
Of the House pointd out the strangeness of
the fact that these claimants for these big
refunds waited until the Republican ad-
ministration came into power and then
presented their claims, and that they have
been approved in such large volume as to
make the total they will have received by
the end OF 1929 over a billion dollars.
Moreover, in addition to paying back
the alleged excessive tax payments,
the Government is paying to the claimants
interest at the rate of six per cent from
the date on which the alleged excessive
payments were made. This is an interest
rate from one and one-half to two per cent
higher than the Government has to pay
for money 1t bonows, and at the least is
a very costly fiscal policy.
or course, most OF these refunds have
gone to giant corporations, some of them
trusts. They, being large taxpayers, of
course have most interest in prosecuting
such claims and employ at fancy salaries
the most brilliant legal talent and income
tax experts available to take up and pre-
sent their claims. The small taxpayer,
who makes a relatively small over-pay-
ment, is in no position to employ such
advisers and as a rule gets nothing back.
One Of the claims allowed and included in
the $75.000,000 appropriation which
House Republicans voted this week, is of
the United States Steel Corporation, and is
for $26.000,000. OF this sum. $l5, 00O,-
00J 10 to cover the original claim OF exces
sive taxes paid and the remaining SILL
100000 to pay interest at six per cent on
that sum. This will make total of $751;
100000 paid to the Steel Corporation in
tax refunds and interest since the policy
Of making these big restorations was inau-
gurated in 1921. The Steel Corporation
has other claims pending and il they are
settled by the Treasury Department on the
same basis, as they probably will be, it
will get more than $40 100000 additional
or total Of more than $76.000000 in
money drawn from the Federal treasury
Representative Garner. of Texas, one of
the Democratic leaders of the House, has
been waging long and hard fight to put
an end to the lax methods in the Treasury
Department in handling these tax matters.
and especially to have large awards passed
upon by some other authority than the
Secretary Of the Treasury or a subordinate
chief responsible only to him. The TEST in
this weeks fight came when Representa-
tive Byrns. of Tennessee, ranking Demo-
cratic member of the Appropriations Com
mittee. moved to recommit the appropria-
ton bill to that committee with instruc-
tons to report ii back with an amendment
under which no part OF the $75,000.000
tax refund appropriation would be avaia-
Bile for the payment OF any claim in excess
Of $4,000. The purpose of this amend
ment was to subject alllaree refund awards
to some additional authority than the Sec
rotary Of the Treasury, probably joint
committee Of Congress. With the party
Lines sharply drawn. Mr.. Byrns motion was
defeated by vote of 1853 to 1870. and the
policy Of returning scores Of millions of
dollars to big taxpayers without any check
outside the Treasury Department will be
continued at great cost to the Treasury.