Evening star., 1936-02-29

ing for sl,137. 100000 in taxes and
they have been concealed or ignored |
when first levied as processing taxes"
but they will occupy a prominent place
In the forefront of public attention
when it is sought to do in another |
form that which the Supreme Court |
Of the United States, by its 6-to-3
opinion on January 6 and its unan-
imous opinion Of January 13. forbade
Congress and the Executive to do. as
a scheme to regulate agricultural pro-
duction.
Puts Burden on Congress.
Mr.. Roosevelt puts the problem of
how to raise the taxes up to Congress.
In an election year new taxes aren't
popular because they stir up antag-
onisms that are reflected at the polls.
Also they provoke discussion as to
"boondoggling" and "W. P. A. stage
money" and they introduce such con-
troversies as Senator Holt Of West
Virginia. Democrat, began when he
declared the West Virginia relief sit
uation was full of politics.
The President divides the $l,137.-
100000 into three parts. About $780,
100000 is to be a new yearly expense
to help pay off the new borrowings to
be made by the Government to pay
off the bonus in cash.
About $5l7,000000 is for benefits
and subsidies to farmers for the year
in which processing taxes were to have
been collected, but were prevented by
court action.
Another $5O0,000 900 is for 'per-
manent" subsidy for next year for the
farmers. And the President himself
uses the word permanent" This Is
the soil-erosion program that has
just passed both houses of Congress.
Expects to Recover S150, 1000 900.
Now of the foregoing Mr.. Roosevelt
has an idea that about s150.000,000
can be recovered by some sort of
special excess profits tax on process
sors who benefited from the Supreme
Court decision with respect to moneys
impounded In the courts. There is no
intention to levy retroactive excise
tax, but tax on income that was
swelled by the processing taxes. It
is interesting that Mr.. Roosevelt esti-
mates only about $3.50 ,00o, 600 recover
able that way.
But how is the remaining $685., 7,000,-
900 to be obtained? Clearly, Mr..
Roosevelt indicates he will be salts
fed II about half that sum is spread
over three years, because 1t is an effort
to replace lost processing tax money.
So the figures can be reduced to about
1862, 100000 or thereabouts for the
new tax bill. This is about the figure
the leaders in Congress would rather
deal with, though it is difficult to see
how this sum can be raised except by
some form Of processing tax or sales
tax. Certainly some of it might be
derived from a revision of individual
income or corporation income tax
rates, but the administrative problem
involved in trying to put it into effect
between now and March Is. when in
come tax payments are next due,
would he almost insuperable.
Would Mean Higher Prices.
So indirect rather than direct taxa
ton must be resorted to. It is likely
that taxes on all sorts Of commodities
will be levied. Probably the sales tax
principle will come into effect even
though there has been and still is
much oposition to the idea on Capitol
Hill.
But to impose taxes on food prod
ucts alone as was the case with the
processing taxes would mean higher
prices and diminished consumption
and would revive the opposition of
various groups to the A. A. A., es-
pecially the textile industry. What
will be sought is a tax that is spread
out IN such fashion as not to in
crease the cost Of living perceptibly
or to afford an opportunity for
pyramiding taxes between the pro-
ducer and consumer.
Mr.. Roosevelt would prefer to have
Congress do the taxing job, as what
ever the men on Capitol Hill consider
politically tolerable will be accepted
by the White House. If the President,
on the other hand, tried to dictate the
form Of taxes, he would have to take
sole responsibility at the polls for the
specific taxes imposed.
AS it is the White House is BEGIN
ming to transfer some of the RESPONSE
bil1ty 1t was so anxious to take three
years ago.
Cites Bars to Balanced Budget.
Mr.. Roosevelt told the press that
except for the relief expenses and
except for the bonus and except for
the Supreme Court decision, the
budget would have been In balance.
The relief expenses together with
the other so-called emergency agencies
would have meant a deficit of about
$4,000 100000 anyway. Now with the
bonus and the replacement Of the
lost processing taxes, it is likely that
the 1887 budget will exceed that for
1886 and the downward curve which
had been hoped for will be replaced by
another upward curve.
There seems to be no hesitation to
take On q $500, 100000 item for per
AIAo41CuG o0noAdy AOI tl4S 4aGIkISIc,
which, if justified. will mean "perma-
i1ent" subsidies for other groups. Con-
gress and the President have been Will
ing to authorize these expenses but the
Congress alone will have to find out
ways of meeting them by assessing
city folks and consumers generally
by sales taxes. And the Senators and
Representatives who are up for re-
election this Autumn will have to get
sanctions at the polls, which Is ell
right for some Of them who have
personal popularity In their districts
equal to that Of Mr.. Roosevelt. but it
isn't all right for those who will have |
opposition candidates Of strong per-
sonality and popularity committed to |
programs Of economy and lower taxes |
It would not be surprising II the new
tax bill cost the Democrats ct least |