The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1931-12-09
NATION MUST
Carry HEAVY
LOAD, He Says
Asks Re- Enactment of 1924
Law to Raise Huge
Revenue.
Text of Hoover message and Mel
Ion report on Page II.
BY RAYMOND CLAPPER,
United Press stan Correspondent

OnItGQ IFCSS stan Correspondent
WASHINGTON, Dec. "A pro-
poSal to raise almost $1,000, 100000
a year in additional taxes by re-
enacting approximately the 1924 in
ternal revenue act for a two-year
period was laid before congress by
President Hoover in his budget mes
sage today.
Mr.. Hoover said this action is
necessary to maintain public con-
fidence and the financial integrity
of the federal government.
He would provide that the tax in
crease definitely terminate July l,
1884.
W.thout specifying details, Mr..
Hoover said the 1924 law should be
re-enacted with such changes as
might be appropriate in the light
of altered conditions.
A return to the 1924 law would
tend to increase federal taxes from
top to bottom, with the heaviest
jumps on wealthy groups, but reach
ing down to include thousands of
small income earners not now taxed.
Would Revive Sales Taxes
1t would revive numerous stamp
and sales taxes such as the 1924
law levied on automobiles, jewelry,
certain amusement places, stock
transactions and legal papers.
1t would raise the minimum in
come tax rate from liz per cent to
: per cent. Exemptions would be
lowered from $500 to $1,000 on
single persons and from $500 to
$1,000 on married persons. The
maximum SurtaX rate would be in
creased from 20 per cent on in
comes of more than 100000 to a
rate OF 40 per cent on incomes more
than 100000.
We can not maintain public con-
fidence nor stability of the federal
government without undertaking
some temporary tax increases" Mr..
Hoover said.
Has Great Advantage
"The plan of approximately re-
enacting the revenue act of 1924
has the great advantage that the
government is equipped by expert
ence with similar legislation for
its systematic and economical COL
lection.
THE public has paid such taxes
in the past and has found them not
lntolerable and has found that they
do not prevent increased prosperity.
By providing a definite date for
termination Of the temporary in
crease it will allow taxpayers to look
forward to definite relief"
The President believes the tax in
crease should be arranged to raise
about $920,000,0 900 a year. This would
not permit balancing of the budget
for the current fiscal year, which
is almost half over, but it would do
so for the next year, except that it
would not cover the $500, 600 900 for
retirement of the public debt.
Cites Necessity of Step
The necessity for this course was
impressed on Mr.. Hoover by the
rapid rate at which the government
is running into debt, due to sharp
falling off in income taxes. His
budget message forecast an esti-
mated total deficit OF $4,442, 0OO, 900
for the three-year period ending
June 80, 1888.
AFTER deducting payments toward
debt redemption this still would
leave a net increase in the national
debt of $3,247 900, 900.
The deficit for the year ended last
June was $902,oOO,00O for the cur
rent fiscal year it is estimated at
S2,l23,O00,00O and for next year.
$1,417 100000.
Meantime, Mr.. Hoover has
squeezed down still further his
budget requests for appropriations
for the year beginning in July-cut-
ting them $365,0oO,OO0 below the
amount being spent this year. He
described this as a drastic curtail-
ment." He emphasized that ma
Clonal defense would not be leo
pardized. The budget calls for a
grand net total of s3,942, 754, 61422.
Led by Garner in 1924
The 1924 tax law was the first big
tax reduction measure under the
Coolidge regime. 1t was revised in
congress by coalition of Democrats
and Republican insurgents under
the leadership Of Representative
John N. Garner, who as the new
Speaker, will have a guiding hand
in shaping the current revision.
Mr.. Hoover also asked congress
to consider the effect Of the capital
gains and losses tax, which has been
criticised as encouraging speculation
and impeding economic recovery.
He appealed for his program as
a necessary factor in rebuilding
prosperity, and he urged all citizens
as patriotic duty to refrain from
urging measures on congress which
would add to government expenses.