Evening star., 1933-05-14
AGREE EONSALESTAX
TO FINANCE HUGE
BUILDING PROGRAM
Drafters for Rate Just Above
| Per Cent Subject to
Roosevelt Approval.
BILL LIKELY TO REACH
CONGRESS EARL Tin WEEK
Opposition at Capitol Foreseen,
but Labor's Objections Are
Believed Lessened.
b. the Associated Press.

=
In the face of rumblings of opposi-
ton at the Capitol, President Roose-
velts committee drafting the revolu
tionary public works-industrial regula-
ton bill yesterday decided to recon-
mend a tax on the sales of industry to
finance the $4,000 900 900 construction
program.
Termed Unemployment" tax it was
understood to have been fixed at just
above l per cent, subject to the ap-
proval of the Chief Executive. 1t is
designed to raise s22o,0O0,00O a year
to provide interest payments and an
amortization fund for the huge issue
of securities designed to provide addi-
tional jobs throughout the country on
the most lavish construction program
ever undertaken by the Government.
Drafters of the bill conferred with
Mr.. Roosevelt upon it more than two
hours last night and predicted upon
leaving the White House at midnight
it would be submitted to Congress next
week. Those present said Mr.. Roose-
welt had reached no decision on the
tax question and that no specific man
ner of raising the 3,300,000.000 would
be included, the door being left open
either for long-term bond issues or
short-term borrowings as the Presi-
dents financial advisers may deem
feasible at the time.
Opposition at Capitol Likely.
Should President Roosevelt send the
measure to the Capitol embodying the
sales tax it will unquestionably run into
obstacles, although the control which
President Roosevelt has held would be
counted upon TO jam the measure
through.
He himself has stood in opposition
to a sales tax and SO has organized
labor. However. it is understood the
proposal has been submitted to labor
leaders and that since the entire re-
ceipts would be segregated to finance
new jobs a greatly lessened opposition
is expected from that quarter.
Donald Richberg, counsel of the
Association of Railway Labor Execu-
tives. has been one of those foremost
in the drafting of the legislation, with
Senator Wagner of New York.
In addition, representatives of the
National Association of Manufacturers
sat with the committee yesterday for
four hours and gave approval in gen.
eral to the sweeping legislation which
O. Max Gardner. former Governor of
North Carolina, described as the most
far reaching of its kind ever pro-
posed in the history of the United
States" He added that 'it should
succeed if the people follow the leader
ship of President Roosevelt
Doughton WithhoIds Comment.
Chairman Harrison of the Senate
Finance Committee is on record as
expressing doubt that sales tax could
be passed through Congress.
Chairman Doughton of the House
Ways and Means Committee, who led
the successful fight in the last Con-
gresS against a general sales tax and
who will be in charge of the new leg
islation, said that before expressing
an opinion on the committees deci-
siCn he would like to see what the
President has to say"
Il didn't know that they had been
called upon to write the financial END
of the BILL the North Carolinian said
My understanding was that they were
to write only the industrial portion OF
the measure. Finances, / thought,
were to be left to the Ways and Means
Committee
'Of course, though, know nothing
definite about it,
Representative Ragon of Arkansas
ranking Democrat on the Ways and
Means Committee, took a similar atti-
tude, saying that he had understood
IAN entirely different tax" was in con-
temptation.
The taxation phases OF the measure
were the last to be settled upon by
the group which has worked for more
than two weeks-often late into the
nlght-in framing the legislation.
AS he left the session yesterday. one
member said there will be no money
spent unless there is money coming
into the Treasury to repay it." In addl-
ticn to providing the greatest con-
struction program ever undertaken oS
the Government. the epochal legisla-
ton would permit industry to unite un-
der cooperative agreements for flxin!
minimum wages, maximum working
hours and stabilizirg production.
By relaxing the antitrust laws. q
proposal which also has been attacked
at the Capital. these agreements woule
be countenanced by law with new
agency of four cabinet members ane
one executive created to pass upor
them. In addition to making show
ing that they would help stabilize in.
oustry, the agreements also would have
to show that additional employment
was possible.
Robert L. Lund. president of th'
Manufacturers Association. who heade'
the delegation at the office of Lew.
w Douglas, director of the budget
said millions of jobs probably woul(
be created under the plan.
Speaker Rainey told newspaper me-
that the bill would freeze" the Conner
and Black 30-hour work bills and tn
plan of Secretary Frances Perkins TO
ACCOMPLISHING similar regulations
will Go to Ways and Means Body.
Beth of these bills will be put ol
Ice" Rainey said. adding that the
would be supplanted by the administra
ton measure. ...
There is a dispute among Hous
Committees over where the publ
works-industry bill should CO." he sale
Il am going to send it to the Ways an
Means Committee because it will pro
vide for revenue raising. I'VE can
split it up and let it go to all the com
mittees which claim jurisdiction to on
section or another"
The sales tax, which was voted dow
at the last session by the House an
was generally accepted as doome
should the Senate have voted, propose
a tax upon the sales Of manufacturer
to retailers ,.....
First proposed with few exemption'
the bill as finally defeated exempte
food. medicines and much chea
clothing.
Whether the committees present pro
rosal would allow any exemptions ha
Lot been announced.