The Waterbury Democrat., 1935-06-20

lect group of individuals whose in- comes are S1,000,000 or more q year would pay most--probably all --.cf new tax bill.
 The United Press was informed that the Roosevelt personal tax plan was aimed principally at mil- lion-dollar incomes, of which there were 4e in 1888.
 Presentation of this plan to en- courage "wider distribution of wealth" and to curtail "inherlted economic power" aroused partisan house cheers and some senate en- thusiasn as we'll as sharp differ- ences of opinion. It was presented yesterday In a special message tc congress.
 To Consider Proposals
 Chairman Robert l.. Doughton Oi of house ways and means commit tee said he would summon commit. teemen today to consider the pro- posals. Senate radicals are maneuvering for immediate enact ment. But New Deal congressional leaders generally desire delay until next session. Mir. Roosevelt's mes- sage suggested time would not per- nit congress to do the job until next year.
 He charged that existing tax policies have not prevented "unjust of wealth and eco- homie power"
 He said inherited economic power was as inconsistent with this gen. eration as was inherited political power when the colonies rebelled against the British monarchy of George III.
 Mir. Roosevelt warned that:
 Social unrest and a deepening sense of unfairness are dangers to our national life which we must minimize by rigorous methods"
 The message committed the New Deal to restrict" individual in- comes in the higher brackets--over 1,00o,000 a year.
 Roosevelt Plan Follows
 The immediate Roosevelt plan to obtain ample revenue without dis- couraging enterprise and to distrib- ute tax burdens equitably is as fol- lows:
 1. High inheritance and gift taxes on "all very large amounts received by any one legatee or ben cficiary." Segregation of this rev. enue for reduction of the ntaional debt.
 9. Tax levies to restrict "very great individual net incomes"
 3. Substitution of a graduated corporation tax ranging from i0% to 16% per cent for the existing 13N per cent rate.
 To thls immediate program Mir. Roosevelt added two longtime ob- jectives:
 |. Taxation to simplify corpor- ate structures by elimination of unnecessary holding ecompanies' in all business.
 ?. Submission and ratification of constitutional amendment to remove the tax exemption from federal state and local government securities.
 Ono Billion Annually
 Treasury officials estimated in- formally that approximately $1,- 00,000,000 of new annual revenue might be expected ultimately from Q tax plan along those lines. A rough unofficial estimate of the composition of that added revenue on the basis of normal business conditions listed:
 Inheritance and gift taxes $500, 900, ,000.
 Taxed governmental securities $100, ,o00, 900.
 Personal income tax--s75.oo0,- 00o.
 Corporation tax-$225, 900, 900.
 Total-$1,000,000, 900.
 Hottest dispute promised to cen- ter around the proposal to increase corporation taxes.
 Our Existing Taxes
 Existing taxes include: The 13% per cent income tax; a per cent excess profits tax on income in excess of 12is per cent of the de- clared value of capital stock; the various manufacturers excise taxes now being continued for another year; one-tenth of one per cent tax on the par value of capital stock issue; and a leavy of 25 per cent up to $100,000 and 35 per cent over that sum on corporate sur. plus funds accumulated to permit shareholders to avoid income sur tax.
 MT. Roosevelt proposed an am- plihed gift tax to supplement his inheritance levy. The existing gift tax ranges from three.quarters of one per cent In the lowest bracket to 45 per cent on gifts of $10.000,- 900 and more which may be made in contemplation of death and for the purpose of avoiding death duties. Both gift and inheritance ieyies would be against recipients.
 The estate tax--graduated up to GO per cent on sums over $10,O00,- 000A-is . levy on the estate before distribution by will or otherwise Although Mir. Roosevelt placed upon congress responsibility for establishing rates at which the in- heritance and gift taxes would be assessed, the plan he proposed has been revealed in detail by Secretary of Treasury Henry Morgenthau, Jr.
 Morgenthau Proposal
 Writing to the senate finance committee on April 24. when rev. enue to pay the war veterans bonus was under consideration Morgenthau proposed:
 1. Subject all inheritances and gifts to a system of graduated levies similar to those now prevail ing on incomes-from 1 to 63 per cent on $1.000.00O or more.
 2. Permit instalment payment to prevent nasty liquidation of large properties.
 Morgenthau estimated that tax system would have yielded $300,- 000,000 next year land might range up to $500, 100000 annually" He pointed out that the estate tax is expected to yield, $190, 900, 900 next year but that England, with one- third of the population of the United States. realized s400,O0O, 900 from estate and inheritance taxes to the past fiscal year. The committee was not favorably im- pressed.
 Only Speaker Joseph W. Byrns His conduct of the trial was eri .