Evening star., 1930-12-07
Senate and House Committee
Heads Say There Will Be
No Additional Levy.
PROGRESSIVE FORECASTS
DEFICIT OF $4o0, 900, 900
Watson Calls on Hoover, Pre-
sumably to Discuss New
Appropriations.
BY G. GOULD LINCOLN.

The fiscal affairs of the Nationa
Government are agitating the legislators
with the session of Congress one weel
| old.
Senator Borah of Idaho yesterda,
advanced the proposition that Congress.
should Immediately increase the norma
tax rate on incomes of individuals anC
corporations 2 per cent over and abovr
the normal rate paid on the 1928 In.
comes, or 3 per cent more than thu
rate paid on incomes of 1929.
He said that after an examination
Of the figures relating to the Govern.
ment's finances, including receipts, ex.
penditures and proposed expenditures
it appeared to him that a deficit OF
nearly 100000 faced the Treasury
at the close Of the fiscal y Ar next
June. III
To arrive at such a figure, the Idaho
Senator took the $3.50, 0,000. 900 probable
deficit OF which President Hoover spoke
In his annual message to Congress, the
proposed $50, 100000 appropriation tO
speed up public building, and another
$50 900, 900 for the relief Of the drought
stricken areas.
HawIey Against Increase.
Administration leaders in the House
and Senate Immediately fell on the
Borah suggestion for increased taxes
like ton Of brick"
and Means Committee when the Borah
proposal was called to his attention
declared emphatically:
Positively there will be no increase
In the Federal tax rates over tie rates
pcid on 1928 incomes"
Mr.. Hawley was asked how the ex-
pected deficit was to be met. His re-
ply was, We'll have to figure that
out. He said that he was expressing
his personal opinion when he said there
should be no increase in the Federal
tax rate.
Senator Smoot of Utah, chairman
of the Senate Finance Committee
which handles all tax legislation, was
equally insistent that there would be
no tax increase over the rates paid or
1928 incomes.
i do not think there will be any in
crease In the income tax rates over
the normal rates existing in the Law
today"
The Utah Senator said that he be.
neVed business will pick up" and that
the returns from the present income
tax rates will be sufficient to meet In
large part the deficit which now con-
fronts the Treasury.
Says Credit Still Good"
He added that the credit of the
United States Government was "stil
good" tnferring that If it were necessary
the Government could easily raise the
needed money to cover deficit at low
rates OF interest. The banks, it has
oeen pointed out, are filled with money
waiting for investment. Such a plan
1t is held, to meet the deficit would bt
lar more preferable to an increase ir
Federal taxes, which might have bac
effect on business, already depressed
and needing encouragement.
The Borah proposal, however. re.
ceived support from Democratic
source. Senator David I. Walsh OF
Massachusetts,, a member of the Senate
Finance Committee, said last night:
L am satisfied that some steps will
have to be taken to increase the take,
on certain classes of income, particu.
larly those on the larger incomes. ir
order to meet the deficit and other in.
creased expenditures that are necessary
to meet the demands of the present
emergency"
Representative Treadway of Mas.
sachusetts, ranking Republican member
OF the Ways and Means Committee OF
the House, however, backed up Chair.
man Hawley and Senator Smoot ir
Iner opposition to an increase in the
Continued on Page 8, Column A.