Evening star., 1936-05-18
--LATEST TAXPLAN
YIELD $642,OOO,ODO,
TREASURY THINKS
Senate Committee Still Is
Cropping for Ways Out of
Revenue Maze.
THREE SUBC0MMITTEES
NAMED BY HARRISON
Word Passed President Desires
Congress to Stay in Session
Until Bill Is Passed.
BACKGROUND

BACKGROUND
President Roosevelt last Febru-
dry recommended substitution of
tar on undistributed corporation
profits for ertSting corporate leuieS,
StreSsing "sinplifcdtton" possible
by tolloiCing this procedure. Two
months later, House passed bill fol-
lotUing suggestion, but so compli-
Gated that te1U members understood
T1nifcGtionS.
Senate Finance Committee is nom
considering raising ertra reuenue
through higher rates for eristing
corporate and individual tareS.
By the Associated Press.
The Tareasury estimated today that
the latest compromise tax plan of the
Senate Finance Committee would pro-
duce s642, ,000,0 900. of which SITS. .000.-
900 would come from individual in
come taxpayers.
committee still is cropping for an
agreement on how to rewrite the tax
bill as it passed the House were re-
quests for additional estimates on
other ways of raising the 1923 600, 900
of permanent revenue sought by Presi-
dent Roosevelt.
Chairman Harrison named three
subcommittee, to report Wednesday
morning on the "windfall' tax feature
of the measure, on a provision for re-
funds on floor stocks on hand at the
time of invalidation of the A. A. A.,
and on "the question of insurance
that might be applied to pay the
Governments taxes"
Adjournment Must Wait.
The committee planed no further
sessions until Wednesday,
In the face of the delay in reaching
an agreement on the tax controversy,
word was passed in responsible Capitol
Hill sources today that President
Roosevelt considered tax legislation eS-
sential and believed Congress should
stay in session until bill goes on the
statute books.
The Treasury. Harrison told news
men, handed over figures today to
show also that by retaining perma-
nently the present excess profits and
capital stock taxes, which would be
kept only temporarily and at half rates
under the House bill, $168,000,0 Of
annual revenue would be produced.
In addition, the Treasury estimated
that s107, 100000 in additional income
would be brought in by putting IS
per cent tax on undistributed corporate
income in excess of half of total in.
come.
Individual Burdens Increased.
The compromise tax plan would
place an 18 per cent tax on corpora
tons statutory net income, which the
Treasury said would yield S244 4,000,.
600; per cent tax on undistributed
adjusted net income, which would
produce $255 100000, an increase the
present normal income tax from to
per cent. which would bring s173,-
900, 900.
Corporation dividends to stockhold-
ers would be subjected to the latter
tax from which they now are exempt,
and this alone, Harrison said, would
account for $lls,OOo,OOO Of the s113,.
000, 900.
Although he said last week he
thought the bill would be reported
out by the middle Of this week the
chairman told reporters today he had
IAN optimistic hope" for the end Of
the week.
Split on individuals Tax.
On the proposal to increase the
normal tax rate on individual income
from to S per cent, the committee
was split so badly that it appeared
uncertain whether it could obtain q
place in the bill.
There also was division in the com.
mittee as to how high the surtax on
undistributed profits should be, but
sentiment was veering toward a
sitter levy than was contained in
the compromise which committee
members considered last week.
That compromise would have placed
a per cent surtax on income which
corporations fail to distribute to
stockholders in the form of dividends,
Some members of the COMMITTEES
argued privately that the compromise
plan would meet with no more favor,
and perhaps less, among business men,
(See TAX Page A-2l