Evening star., 1935-08-12
i. S. DEFICIT GAINS
DESPITE WIDER TAX
Present Measure Raises
Just Enough to Pay Bills
of Last SO Days.
BY DAVID LAWRENCE.


tional revenue is raised, barely enough
to pay the total deficits of the Fed
eral Government for the last 38
days-this is the story OF the income
tax bill just reported by the Senate
Finance Committee.
II there we're any more eloquent
way to hammer home the meaning of
the gigantic adventure in spending
public money embarked upon by the
New Deal, members of the Senate op-
position have not yet discovered it.
In fact, it begins to look as If Mr..
Roosevelt might wish he never men
toned the subject of taxation at this
time. From a political viewpoint 1t
would have been wiser to postpone the
new tax bills till next January and
then make them effective in March
1887, after the presidential election
had been held and thus permit the
campaign to be waged without having
the voters feel the pinch of taxation.
Whole Measure May Die.
But the Senate Finance Committee
measure is not what the administra-
ton wants, and it is unlike the House
bill with its inheritance tax feature.
The problem presented by what the
Senate Finance Committee has done
is so complicated that it would not be
surprising if the whole tax measure
died in conference and Congress ad-
journed without doing anything at all
to increase taxes. This would be very
sensible procedure anyway, because no
tax bill can be written and made real
ly effective from a revenue raising
standpoint If it is attempted in the
haste that has governed the commit
tee meetings Of the House and Senate
since Mr.. Roosevelt last month tossed
the tax at Congress.
There ought to be. of course. a
comprehensive tax measure, because
the need for balanced budget some
time in the next two or three years
is more than ever apparent now, as
the borrowings reach an all-time high
in the history of the republic A we'll
balanced bill, however, that gets large
revenue returns. cannot be drawn
without more time. If Congress ad-
Journed now and came back in No
vember with its recommendations
there would still be time enough to
put the new rates into effect in 1896
TO affect incomes of the calendar year
1885.
But the painful truth which anv
tax bill written now will emphasize
Is that there simply are not enough
tax revenues to balance budgets run
ming to 10 and IL billion dollars a
year, and that the only way to get
balanced budget is to cut expenses
drastically
The administration does not want to
cut expenses at present, with an cleo
tion coming on. 1t fears the vote of
those who would have financial bene-
fits taken away. 1t fears, too. the i'll
FEELING that must arise when the vot-
ters learn that, even with the high tax
rates aimed at rich and poor alike, the
sums raised are mere drops in the
bucket, and that the budget even
thereafter will continue unbalanced
just the same.
J. anybody examining the tax rates
Just submitted by the Senate Commit
zee on Finance will find that they cut
deeper than any tax bill the Govern
n1ent has ever had and that the i'm
position of surtaxes to begin with
S5.OOO-a-year incomes Is going to af-
1ect large number of voters. to sav
nothing of the increased number of
persons who will be added to the Fed
eral tax list when the exemption mark
goes down, as it does in some cases in
the Senate bill, to incomes of $500 a
year for an unmarried person. 1t
used to be at $1,000. Married persons
nave been exempt if their incomes
were S2,500 year or less. but now
more may have to pay taxes. as the
proposed exemption will stop at 81. 900
o year.
Adjournment in Danger.
Wnat will the final bill contain?
lne question is very difficult to an
swer. Thus the House bill contains
inheritance taxes, but increases the
rates on total estates of persons who
die. wiz
The passage, however, by the Sem
ate this week OF bill different from
ihat OF the House seems a foreeone
conclusion. Rewriting the bill In
conference committee of both houses
also seems inevitable. This NAV mean
Swo weeks of discussion, all of which
would delay adjournment, to attain
winch happy event there is at present
q genuine drive.
: PRESIDENT Roosevelt probably did
not intend in the first instance TO
nave tax legislation this session. But
senator La Toilette and his eroup
INSISTED, and by doing so put Mr.
hooseVelt In the awkward position of
having to back down publicly on his
own recommendations or insist on a
lax Dill now. So, when the Senate
has acted, the promise or assurance
gwen MIR. La Toilette that there
would be action at this session by the
House and Senate will have been full.
snlled. Mr.. Roosevelt then will not
oe to blame if the measure dies in
conference between the two houses
: AS Tor the millions of persons to be
eHected by the unscientif1c rear
rangement of surtaxes, especially on
small incomes, they, too, would not
De disturbed If the tax bill went over
I'LL business were a bit better. And
1t is rapidly improving.
(Copyright Iq25l