Evening star., 1936-04-24
.LAMNECK ASSERTS
NEW TAX BILL WILL
DESTROY BUSINESS
Aims to Compel Distribution
Of Earnings of Corpora
tions, He Says.
REED TERMS MEASURE
"DRASTIC," "COERCIVE"
Senator Harrison Declares Com
mittee Will Report Legisla-
ton of Some Character.
BACKGROUND

BACKGROUND
Much to distress Of members of
Congress facing reelection cam
pdions this Summer and Fail,
President Roosevelt last February
requested new tar legislation. Pro-
poSal WaS for complete revision Of
corporate tar structure uith SIM
pifed" levy on undistributed PROFITS
replacing present assessments.
After nearly tiUo months OF eff
fort, House Ways and Means Com
mittee this treek reported out one
OF most compiler and inUolUed
pieces OF tar legislation euer to
face Congress- In attempt to make
it understandable, Representative
Hill OF committee yesterday turned
House chamber into class room, but
certainty that administration
Stedm-roller UiH force measure
through House without major
changes left membership indifer-
ent to real content. ReUrite job is
expected in Senate.
BY the Associated Press.
The administration 1903 900. 000
tax bill struck its first blast of Demo-
cratic opposition in the House today
when Representative Lamneck, Demo
crat, of Ohio contended it would de-
stroy the Nations business.
Lamneck, a member of the Ways
and Means Committee, which wrote
the measure, took the floor after Rep
resentative Reed, Republican. of New
York, renewed the republican opposi-
ton to the intricate tax plan with
such terms as drastic" and 'coercive."
This bill" Lamneck said, will de-
stroy absolutely thousands of business
concerns of this country"
He added that it attempts by tax
alton ito compel business institutions
to follow our bidding" and contended
mo such power is vested in the Con-
stitution."
The principal aim Of the bill, Lam
neck said. is to compel the distribu-
ton of earnings of the closely held
corporation, the most striking exam-
pie of which is the Ford Motor Co."
Questions Revenue Powers.
Then he questioned the bills money
raising capacity and asserted belief
that the revenue this year will be less
than under existing law
Appealing to the House to consider
the bill on its merits and not from
party standpoint, Lamneck said:
TT will tend toward monopoly.
TT will prevent weak corporations
and those with impaired capital from
rebuilding their capital structures
which have been terribly depleted dur
ing the depression.
1T will prevent the accumulation
of the necessary surplus for the rainy
day to pay dividends during the de-
preston. to keep men employed during
the depression years; it will prevent
business from accommodating earnings
for plant improvement and for de-
velopments generally.
1T will tend toward overcapitaliza-
ton; it advocates policy exactly op-
posite to our past history of saving
and paying our debts"
Takes Second Lesson.
The Senate Finance Committee took
its second lesson on the complicated
revenue plan, after which Chairman
Harrison announced:
Il don't anticipate any great amount
of trouble in getting a bill out"
Only of the 81 members Of the
committee attended the executive
meeting. L. H. Parker, chief of staff
of the joint Congressional Taxation
Committee, explained the new ccrpo-
ration levies.
Harrison reiterated that If the
House bill did not provide sufficient
revenue his committee would consider
adding new levies.
There will be no tax bill next
year." he asserted fatty.
This bill (now before the House)
or one carryingout the general purposes
will be reported by this committee,
Harrison said.
Lamneck Is Cheered.
To the accompaniment of loud Re-
publican cheers, Lamneck assailed
Chairman Doughton. who is in charge
(see TAXES, Page %