Evening star. [volume] (Washington, D.C.) 1854-1972, 1935-08-12
TAX BILL DEADLOCK
DECLARED LIKELY
BY REVISED PLAN
Entire Program Believed
Endangered as Leaders
Line Up for Fight.
100000 AFFECTED
BY NEW SCHEDULES
Borah and Norris Among Those
Ready to Oppose "Unjusti-
fed Changes in Measure.
BY JOHN c. HENRY.

BY JOHN c. HENRY.
Trouble was continuing TO pile up
today for a tax program that started
out to soak the rich" and which now
threatens TO soak everybody"
Drastlcally revised by the Senate
Finance Committee, the legislation
now applies first to the single man
with $500 net income per year and
extends through all the upward brack-
cts of individual and corporate in
come, increases estate taxes, excess
profits taxes, capital stock taxes, gift
taxes on donors and surtaxes.
With most of the major changes
being written into the legislation at
his insiStence. Senator La Toilette,
Progressive. Of Wisconsin. this morn
ing undertook to explain his reasons
for advocating lower exemption for
individual income tax payers. His
comment follows. in part:
In a crisis of this kind. 1t is i'm
possible to balance the budget in the
technical sense of the term. We must
continue emergency expenditures and
these total more than We can quickly
reach in revenue.
But we have reached point where
the taxpayers must decide whether
they are willing TO pay more than at
present or have uncontrolled wildcat
initiation.
Every country has been faced with
this choice, end only one thus far has
had the courage TO meet the problem
b. widening application of its tax
structure. That one is Great Britain.
Wildcat initiation leads 10 an upside
down condition in which those least
able to pay suffer most. Therefore. I
believe the taxpayers in the lower
brackets should be willing TO make a
small contribution in extra taxes for
their own protection. The money can't
all be obtained from other sources.
and I figure that the lowering Of the
Individual exemptions will bring an
added $40 060 600, while spreading the
load sufficiently to keep the individual
contribution extremely low The bulk
of the S220.O0OO0 expected from this
whole section of the present bill still
will come from the higher income
brackets. from those best able TO pay
Increase Declared Small.
Pointing at that the added tax bur-
den on couple OF $4,000 net income
would amount only to $40. the Wis
consin Senator termed this not ex-
cessive' as a contribution to meet the
effects of the depression. The in
crease on single persons would amount
only to So per year. he said.
Referring to the longtime posi-
bIlltieS contained in a broadening of
the tax base, the Senator said this
action might lead to a tightening of
the burden of indirect taxes. such as
high tariffs. excise levies, etc.
We can't remove these tolls at the
present time" he said, but if eco
nomic conditions improve, the broad
ening of the income tax base would
greatly improve the possibility of lift
ing some of these charges. These in
direct taxes are collected entirely
without regard to ability to pay"
Program May Be Blocked.
In its reduction of the single per-
sons income exemption from $1,000
to $500 and the married couples ex-
emption from S2.5OO to $4,000, how
ever, lies the principal threat of trou-
BILE. which may become so effective
as to block completely any enactment
of tax legislation during the present
session.
Experts have computed. for instance.
nc Of
ton levels will force the filing OF
income tax returns from 1000, 900 per-
sons, an increase of 100000. From
this added 100000 it could be ex-
pected that about half would be forced
to pay a tax. In political quarters,
particularly in the House of Repre-
SentativeS, where the will of the voters
is made known every two years, the
temper of 100000 voters will not be
regarded lightly.
AS the Senate Finance Committee
met to take final vote on the re-
drafted measure, Senator Robinson.
the Democratic leader. asserted the
revisions materially complicate the
situation" and probably will cause
|
Personally" he added. II do not
feel that the lowering of exemption
from income tax or the increase in
the lower brackets are justified at
this time"
Representative Doughton, Democrat,
of North Carolina and chairman of
the House Ways and Means Commit
tee, declined this morning to comment
at much length until the Senate COM
mittee actually reports the bill, but
he ventured the opinion that the
House will stand firm for legislation
in the same general form as approved
by that body.
Admits Chances of Deadlock.
With some pleasure, he pointed out
how the Senate Committee. after
criticizing the House for not follow
ing presidential recommendations, had
departed to an even greater extent.
Asked about the possibility of a House.
Senate conference deadlock preventing
any enactment, the House leader ad-
mitted such a chance.
Before the legislation reaches the
tax-timid House, however, a full meas
ure of controversy and conflict is being
promised it in the Senate. Already
the committee changes have precipi-
tated a rift in the so-called liberal
group with Senator Borah, Republican.
of Idaho, criticizing changes written
into the bill at the insistence of
Senator La Toilette, Progressive, of
Wisconsin.
Directing his criticism at the lower
ing of individual income tax exemp-
tons, Borah said:
81 do not see the justice or wisdom.
economically speaking. OF lowering the