The Washington times., 1933-05-27
SENATE FACING
PROSPERITY
TAXF|GHT
House Passage Shifts Battle
to Upper Chamber; Revolt
Against LevieS Likely

President Roosevelt's Pros
perity ll"-embracing new
deal for industry and the jobless
but providing a heavier tax for
the little income taxpayer and
the average citizen-was sent to
the Senate today after its trt-
umphal passage in the House.
The bill, which suspends anti
trust laws to permit combination
of industry and labor, carries a
$3,30O,0OOO00 public works pro-
gram and a $700, 100000 tax plan,
probably will be called up IN
the Senate late next week.
Senate Revision Seen
Drastic revision of the tax plan
in the Senate was forecast as a
result of revelations in the Nor
gan inquiry and widespread oppo-
sition to harsh tax increases upon
the average citizen.
After Democratic leaders twice
saved the bill from being wrecked
by narrow margins, the House
rallied on the final vote ana
passed it-324 to 76.
Before final passage a bi-parti-
san coalition proposed to subst1-
tute a manufacturers sales tax
for the income tax boost, gasoline
tax, bank check tax and other
miscellaneous sales taxes, but the
effort failed, 1877 to 265.
Morgan Quiz a Factor
Backers Of the sales tax pro-
vision, bitterly iSappoin t e d,
charged that IDEALS were made on
highway allocations and political
pressure was used to defeat their
attempt. Several members who
had announced that they would
support the sales tax turned
against it on the roll call.
AS passed, the bill carried a tax
amendment growing directly out
of the fact that j. P. Morgan &
Co. paid no income tax for two
years.
Under this amendment taxpay-
erS cannot use net losses in one
year to offset income taxes in
the next. Claims were made by
Democratic spokesmen-and dis
puted-that the provision would
curtail the deductions made by
the Morgan company if SINH
lar situation arises n the future.
Tax Probe Promised
To quell the rebellion against
the tax provisions, the Ways and
Means Committee promised to
open next week a general inveSti-
CATION of the tax laws to plug
up loopholeS.
The industrial recovery bill,
called the capstone of the Presi-
dents program, authorizes:
Formation of trade assOcia-
tiOns to set up codes of fair
competition with approval of
the President, the codes being
| designed to fix minimum wages,
limit hours of labor, and fix
other working conditions.
Temporary repeal of all anti
trust laws with provisions.
Enforcement through the
President by licensing industries
and closing factories violating
the fair competition code.
Gifts, Loans to States
FlOtatiOn of $3,3OO,OOO,OOO
public works bonds issue for pub
lie buildings, highway, flood
control, rivers and harbOrS,
slum clearance, naval cOnstruc-
tiOn and similar projects.
Definite allotment of $780,
100000 public works bond issue
for public buildings, highways,
flood control, rivers and har-
bors, Slum clearance, naval con-
struction and similar projects.
Definite allotment Of $4OO,OOO,-
900 for highway construction,
designed to launch 100000
600 Of State, county, and mu-
nicipal projects, the Govern
ment giving 30 per cent and
I0aning 70 per cent of the cost.
In addition to levying 1921 ,OO0,-
600 in taxes to finance the bond
issue by raising income taxes of
small taxpayers, increasing the
gasoline tax "a of / per cent a
gallon, and making dividends sub
ject to normal taxation, the bill
continues for a year over $780,
100000 taxes which would expire