Evening star. [volume] (Washington, D.C.) 1854-1972, 1932-03-23
What Next

ton OF the manufacturers sales TAX IN
the pending revenue bill, the insurgents
against the House leadership yesterday
increased materially the rates Of the
estate tax section of the bill. This is
q companion measure 10 the increases
in the income tax rates adopted last
week, restoring the rates of World War
days. The demand of the insurgents is
that the burden of increased taxation
be placed on the shoulders Of wealth.
Tomorrow the House, in committee Of
the whole. will deal with the manu-
facturers' sales tax itself.
Should the manufacturers sales tax
be defeated-and there is strong in
dication that it will be defeated-the
House will be compelled then to adopt
other substitutes for 1t than the taxes
on wealth contained in the amend
ments to the income end estate tax
sections of the revenue bill. Despite
all the talk on the floor of the House
about placing the burden on big in
comes and big estates, those measures
will fail entirely to meet the situation,
to balance the Governments budget.
Experts of the Treasury Department
have estimated that the increases in
the tax rates on incomes will net the
Government an almost negligible sum
of money, owing to the great shrinkage
in incomes. As for the estate tax, ex
travagant claims have been made by
the supporters of the Ramseyer amend
ment as to its results. The fact re-
mains that under the law year. two
years and even five years are given to
settling estates There is the danger,
too, that many of the wealthy men
and women of the country will fail to
die within the next year or two, even
for the sake of balancing the Govern
ment's budget.
1t is obvious, therefore, if the manu-
facturers' sales tax is to go out Of the
bill. taking with 1t $500. 000, 900 of
potential revenue. other sources of in
come for the Federal Government must
be found or the Congress must abandon
its plan to balance the budget; the
Democratic-controlled House will have
admitted its inability to deal with this
most important subject.
Then will come the tug of war, in
deed. Having laid aside q sales tax
that will fall on all manufacturers alike,
except for the producers Of food stuffs,
wearing apparel, medicines and farm
machinery, 1t will become necessary to
levy taxes on individual industries or
to 60 to increased postage, taxes on
bank checks and other so-called Lui-
sance taxes. The House will have TO
determine which manufacturers are to
bear the burden and which are to
escape scot free. Each industry will
have its supporters in the House, who
will do their best to prevent the i'm
position of taxes on their interests. And
later, when all is said and done, the
House will have come to q number of
sales taxes on individual industries
which it will proudly label excise
taxes"
Secretary Ogden Mills of the Treas
ury Department, in a letter to Repre-
sentative La Guardia of New York, who
has led the insurgents of the House
against the Ways and Means Com
mittee revenue bill, discussed in detail
the La Guardia substitute program. Mr.
Mills showed that this program Of the
progressives falls about half a billion
dollars short of the needed revenue.
The Ways and Means Committee Of
the House worked for weeks In an effort
to frame revenue bill that would pro-
vide the required $1,lOO,OOO 900 addi-
tional revenue needed to balance the
budget at the close Of the fiscal year
1888 1t brought in a carefully worked
out bill and threw it into the House.
Opposing groups formed quickly, COM
posed in part of members who desire to
levy a tax which will be felt by the
least number of voters. The result has
been chaos in the House, with Speaker
Gamers boosted control Of the Demo-
cratic majority shot to smithereens. If
reports be true, it will not be long
before the House will be faced with
proposal to expend a couple of billions
of dollars for the soldiers bonus. How
many Of the members of the House who
are taking part in the revolt against
the Ways and Means Committee in its
effort to balance the budget will be
found supporting this new proposal to
spend the peoples money? 1t will be
interesting to see how they line up.