Evening star., 1935-04-05
SOCIAL SECURITY
MEASURE IS GIVEN
FORMAL APPROVAL
III Democrats on Commit.
tee Vote to Report Bill.
G. 0. P. AbStains.
| MAJORITY POSTPONES
GAG RULE DECISION
Official Estimates Place Taxes to
Carry Out Provisions at
$1,sO0,0o0, 900 in 1s49.

BY the Associated Press.
Final, formal approval was given by
the House Ways and Means Commit
tee today to the social security bill.
The II Democrats present voted for
a motion to report the measure to the
House. while the Republicans voted
present" Representative Lamneck,
Democrat, of Ohio, was absent because
of illness.
The Democrats, in later meeting,
however, deferred until later in the
day a final decision on whether to ask
leaders to let them bring the bill up
under a gag rule" 1t was indicated
the committees request would be for
a ruls,>permitting consideration only
of amendments offered from the floor
by the committee.
Cost Estimates Made.
Meanwhile. official calculations that
the bill would mean $500 ,000.0 in
new taxes in 1887 and a minimum of
81 800 100000 by 1949, brought new
energy to the fight over the measure.
The figures were prepared by Ways
and Means Committee experts.
Republicans Immediately seized
upon the estimates as providing new
support for their contention that the
bill puts too heavy a burden on busi-
ness. The minority members OF the
Ways and Means Committee talked
over the figures in a meeting pre-
liminary to conference Of the 103
Republican House members tonight.
They indicated that if it were pos
sible, they would try either to elimi-
nate the taxes. to reduce them or to
postpone their effective dates.
The Democrats on the Ways and
Means Committee already have de-
feated on several occasions attempts
to reduce the tax requirements of
the bill.
In its final form the measure levies
two types of taxes on pay rolls: One
for contributory old-age annuities and
one for unemployment insurance. The
old-age annuity taxes start at per
cent on January /, 1937-half paid by
the employe and half by the employer
and rise per cent each three years
to a total Of 8 per cent on January /,
1949.
8 Per Cent on Unemployment.
The unemployment insurance taxes
also on pay rolls-are all paid by
the employer and begin at / per cent
on January /, 1886, and increase / per
cent year to 3 per cent on January
l, 1888.
The committee experts calculated
the unemployment insurance tax
would cost the employer 5000, 900 900
next calendar year, $400, 100000 in
1887, 00,000,00O in 1888 and each
year afterward
They figured the annuities tax
would cost the employer and the en-
ploye each s2O0,OOO.OOO in 1887,
$500, ,000,0 900 in 1910, S40O, ,000, 900 in
1943. $500 100000 in 1916 and $780,
000, 900 in 1949.
Thus, they calculated, the total tax
burden would be $500, ,000,O in 1896,
$500, 900, 900 in 1887, $1,000 0,000,00O in
1888, 10000, 900 in 1910, s1,4O0,-
100000 in 1943, $500, ,000, 900 in 1946
and 1900, 900, 900 minimum in I949.
s9S,43s.000 More Needed.
Republicans also said that in addi-
ton to those sums, it would be neces-
sary to get S98, ,438 900 out of general
tax receipts next fiscal year for other
phases of the bill.
That total includes s49, 75O, 900 for
old-age pensions to the needy; $24,-
100000 for dependent children; $10,-
100000 for public health and So, 1900.
900 for maternal and child welfare.
In future years, the cost of old-age
pensions for the needy would decrease,
but after the next fiscal year there
would be Federal appropriation Of
$49, ,000.0 annually for administra-
ton of unemployment insurance un-
der systems set up by the States.
May Halt Sales Tax Drive.
Congressional tax leaders believe
the social security bill will enable
them to beat down with ease any re-
newed drive for Federal sales tax.
They had anticipated that some at
tempt might be made to put through
a levy on manufacturers sales when
Congress finally gets around to EXTEND
ing the nuisance taxes which will ex-
pire around June 80 and which now
return about $416, 900. But yes
terday Chairman Doughton Of the
House Ways and Means Committee
remarked:
I don't think you'll hear so much
talk about q sales tax this Congress.
This social security bill may force the
States to raise some money for old
age pensions and other things. In
fact, they won't get any Federal as
sistance unless they do.
And my idea is that a lot of States
will want to preserve the sales tax
field as their own to raise that neces-
sary money"