Evening star., 1932-05-31
SENATE INCREASES
RATES ON INCOMES.
Mills Tells Committee Reve-
, nue. Measure Needs Addi-
tionaI $685. ,OO0,0 900.
(Continued From First Page)

SldllNe pdtlleS, al upIOdT VI OeUdte Oh
the new turn of affairs swept the
chamber, few steps away.
Senator Borah Republican. of Idaho,
told the Senate it need not be surprised,
because Secretary Mills had been openly
for the sales tax fer some time"
The CnIy reason he didn't recon-
mend it in the beginning was because
he did not think it was practical at that
time to secure its adoption" Borah said.
Seen Blow at Buying Power.
He has at all times been an ad-
vocate of the sales tax. From the time
the Mellon dynasty took charge of the
finances of the country down to the
present the fundamental principle was
to lower taxes on the wealthier and
place them gradually on the common
individual.
Il believe the levyins Of sales tax
will further aggraVate conditions in this
country.
When you levy sales tax you serve
notice to 70,000,000 people you are de-
creasing their purchasing power"
After the Secretary had concluded his
statement, Chairman Smoot adjourned
the meeting and the members went to
the floor to hear the President.
Democrats of the Finance Committee
who yesterday signed a pledge against
the sales tax voiced open resentment as
they left the committee room against
what they called 'stampeding move
ment for the sales tax"
Several in the gallery applauded
when Senator Glass, Democrat, of Vir-
ginia, asserted emphatically you are
not going to balance this budget unless
. you cut expenses of this Government
severely" Vice President Curtis raped
sharply for order.
Glass Hits War Chest.
Glass assaiIed particularly the ex-
pendiIures for war purposes" which
he said amounted to a billion dollars.
Joining in the debate, Senator
Couzans, Republican, of Michigan, re-
piled to a speech by Reed last night in
which the Pennsylvania urged the
SALES tax and warned Of world run on
American gold. He charged Reed with
selling America short" in order to OBJ
tain approval of the sales tax.
Though I am foreign born" Couzens
sid, L have no desire nor at any time
have l sold America short"
But it seems our colleagues and
others are willing to sell America short
fer the purpose of putting across their
own program"
More Revenue Needed.
At the White House last night Presi-
dent Hoover informed Senate Democrats
OF the need for more revenue than now
is provided by the pending tax bill. He
received tacit support.
The sales tax against which SIS men,
bers of the Senate pledged themselves
yesterday, was not mentioned at the
White House last night.
Owen D. Young, New York financier
snd prominent Democratic leader,
Joined Mr. Hoover Secretary Mills,
Charles G. Dawes and George L. Har-
rison. governor of the New York Fed
eral Reserve Bank, in outlining to the
Democrats the new emergency situation
requiring the additional funds.
Senator Robinson of Arkansas the
Democratic leader, and his party's men,
bers of the Finance and Economy Com
mlttees expressed confidence upon
leaving the White House that the needs
Of the Government for next year, even
though they have been expanded, could
and would be met along the lines the
Senate and House are now proceeding
Reed Sponsors Measure.
Changes in business conditions since
the Treasury estimates were prepared
apparently have convinced the tax ex-
perts their original estimates were too
optimistic. The possibility OF some
uhat higher Federal expenditures than
originally we're calculated also entered
the question.
The move for supplemental revenue
measure was presented to the Senate
yesterday by Senator Reed.
Senator Harrison of Mississippi, the
Democratic tax leader, in presenting
the petition in opposition to the sales
tax. told the Senate sales tax advocates
q fight is futile"
iy,O nf
runs on American gold with a possible
gold embargo and forcing of the United
States of the gold standard. This
brought sharp retorts.
La Toilette Replies.
Senator La Toilette, Republican, of
Wisconsin. said 1.-The Senator from
/ Pennsylvania has made three speeches
which, whether they we're calculated to
doing all that is in the power of the
Senator from Pennsylvania to create
both a foreign and domestic run on
the American dollar.
, Il say it is nothing short of striking
blow in this critical situation for
the administration and the Senator
from Pennsylvania to arise and make
a speech of the character which he
has made this afternoon"
But fer advocates of the sales tax,
La Toilette said, the Senate could have
! completed its tax bill task last night.
| Responsibility for further delay and
! enhancing the panic which they have
| already created in the public mind rests
! on advocates of the sales tax" he con-
: cluded.
| Earlier Senator Lewis, Democrat, of
Illinois, referring to Reeds remarks
. about WithdraWals of gold asked who
! are these financiers of the United
! States who are sending out the gold
1 OF this country in large sums of
! meney?"
= What of their patrietisms" he in
/ quired
! Lewis said that if Reed referred to
ear-marked gold. that does not belong
to the United States anyway and the
news Of its withdrawal should not be
used in a way that would create the
terror that brings on panic
Reed Cites Distrust.
Concerning the gold Withdrawals
from the United States, Reed asserted
/. I'VE know our country is sound. but the
as fast as steamers will carry it. We
lost Sl00,000,001 last week We can't
stand the drain continuously without a
gold embargo and that means going off
tho gold standard
Members on both sides of the aisle
harassed Reed with demands for the
basis Of his new estimates. Robinson
called attention that the Walsh sales
tax proposal would not provide any new
revenue because it was proposed as a
substitute for the excise rates In the
bill
senator Walsh said his Its per cent
Geles tax would raise 335,000,O0O and
aisplace 1922, 100000 in taxes already
IN the bill. Reed said he would favor
cutting down the suhstitutions to elm
rates.
Senator Vandenberg. Republican,
Michigan, replying to Walsh. said the