The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1931-11-17
HOOVER PLANS
TO BRING BACK
1924 TAX LAW
Restoration of Old Rates
Will Mean Revenue Hike
of 700 Millions.
SALES LEVY ON AUTOS
Nuisance ImpoStS Will Be
Revived; Corporations to
Pay More.
PAUL r. MALLON
United Press stan Correspondent

WASHINGTON. Nov. 17.-Presi-
dent Hoover's well-guarded plans
for tax revision, it was learned to-
day on good authority, are based on
restoration of the 1924 law.
The treasury has informed the
President it will mean an increase
of $700,000,000 in annual govern
ment revenue.
The plans involve resumption of
the 40 per cent maximum rates OF
surtaxeS, gift taxes, and inheritance
taxes. 1t includes an increase in
normal tax rates, decrease of
exemptions, sales tax on automo-
biles, increased corporation taxes,
and most of the postwar nuisance
taxes.
Treasury experts are working out
some revisions of the 1924 system,
bringing it down to date. A con-
siderable number of changes are ex-
pected to be made before the plan
is dispatched to congress by Mr..
Hoover three weeks hence.
Raises Third of Deficit
1t therefore is too early to say
definitely which specific taxes will
be recommended, but the general
basis on which Mr.. Hoover is work.
ing reveals the extent to which the
administration is planning to go to
balance its budget.
The $700,000,O00 plan would make
up one-third of the deficit expected
by the treasury at the end of this
fiscal year. Economies in govern
mental operation and a change in
the debt retirement program may
furnish substantial portion of the
remaining two-thirds.
The question of a general sales
tax is receiving no serious consider
alton at the White House. In the
modified form of increased excise
taxes, it will be included in the new
plan. Sales of jewelry and other
luxuries will be taxed on a scale
similar to that of the 1924 law.
Democrat Leaders Mum
Congress already is in receptive
mood for the proposal. Almost
unanimously, the Republicans now
here, including the Independents,
approved boosting the rate on high
er incomes. They differed about in
creasing the normal rates on small
incomes, but they showed enough
unanimity of opinion to warrant the
assumption that a tax increase bill
will be passed before congress adj
journs next June.
Chairman Hawley of the house
ways and means committee declared
himself to be frankly skeptical Of
the need for any increase in taxes.
He said he believed sentiment had
been all opposed to any increase
until he got to Washington, where
he was surprised to learn there
seemed to be considerable sentiment
for it.
Additional proof of the need Of
an increase must be shown him be-
fore he will approve, Hawley said.
Some of the Democratic leaders,
including the expected Speaker of
the house, John Garner, were silent.
Their reticence was explained by
the political situation. If taxes are
to be increased, they want it to be
Republican, not a Democratic
measure.
Senators Back Increase
Chairman Smoot of the senate
finance committee, Senate Floor
Leader James E. Watson, and Sem
ator Fess, chairman of the Repub-
lican national committee, were
hand in hand regarding necessity
for the increase. They made state
ments indicating they favored in
creases in the higher income
brackets and a boost of excise taxes.
In this they found themselves in
agreement with the western indie
pendents, Borah, Norris, Frazier and
Nye. They will be satisfied if the
present tax of 20 per cent on large
incomes is boosted to 40 per cent.
although they would like to see it
go higher.
Approval of this general theory
also came from Senators Couzens
(Rep., Mich, Walsh Dem, Mont),
Capper Rep., Kan), and Repre-