Evening star., 1937-11-27
CAPITAL GAINS TAX
REPEAL ADVOCATED
Representative Ludlow Of
fers 3-Point Plan to
Aid Business.
By WILL p. KENNEDY.

4
Outright repeal of the undistrib-
uted profits and capital gains taxes
at this special session is advocated by
Representative Ludlow, Democrat. of
Indiana, spearhead in the drive OF
House leaders to reduce congressional
appropriations considerably below
budget recommendations in an effort
to balance the budget
In announcing this as the out
standing feature in his three-point
program ito head off business recess
sion and promote sound recovery" the
Hoosier legislator breaks away from
his party representatives on the spe-
cial subcommittee working on tax re-
vision and strongly supports the Re-
publican stand repeatedly stressed by
Representative Treadway Of Massa-
chusettS, ranking minority member on
the Ways and Means Committee. Mr..
Ludlow declares that Congress must
take the fetters off buSiness-especial-
ly small, honest business enterprises.
Already Mr. Ludlow, chairman Of
the subcommittee considering the first
and largest Of the 10 regular appro-
priation bills-that for the Post ONCE
and Treasury Departments, which
sets the policy for all the supply bills
has cast Federal pump printing in
the discard and started on strict
economy program to cut under budget
estimates
Three Point Program.
His three point program is:
/. Congress and the administration
should make the best possible ap-
proach toward balanced budget.
2. Congress should repeal outright,
or at least drastically modify. the un-
distributed profits tax, the capital
gains tax, and other laws that bear
''unjustly and harmfully" on small,
honest business concerns.
3. Business must then be left alone,
so that it may orient itself to new con-
ditions with minimum of "unneces-
sary' governmental interference.
Representative Ludlow emphasized
that neither Congress nor the admin
istration alone can execute the pro-
gram necessary for recovery"
If We are to put the country on its
feet for a program of economy and
retrenchment, there must be will to
economic. both in the executive de-
partment and in Congress- he said.
Away to Early Start.
Because of the special session, Rep
resentative Ludlow's committee got
away to an early start on the Post
Once and Treasury appropriation
bill. In his opinion, the approprla-
tions for the postal service brings the
proposed strict economies directly
home to the people in every commu-
nifty while the earnest holding down
on funds for the Treasury depart
ment would support Secretary of the
Treasury Morgenthau in advocating a
balanced budget. Chairman Ludlow
feels this is key measure for these
reasons His colleagues on the COM
mittee are Representatives Boylan Of
New York, ONeal Of Kentucky, DAILY
of Pennsylvania, Johnson Of West Vlr-
elnia, Taber of New York and Otter
of Pennsylvania-the latter two Re-
publicans
to prime the pump when the pump
no longer needs priming simply would
not make sense" declared Mr.. Lud-
low. We cannot spend vast sums
every year above receipts without in
viting imitation, reputation and ma
tionaI bankruptcy" He points to the
Presidents message to Congress on
November Is. as giving a splendid
text" when he said:
obviously an immediate task is to
try to increase the use of private capi-
tai to create employment Private en-
terprise, with cooperation on the part
of the Government. can advance to
higher levels of individual activity
than those reached earlier this year"
Sound Philosophy.
This recommendation of the Presi-
dent lis founded on sound philoso-
ply" said Mr. Ludlow Immediate
repeal or modification of drastic laws
that are strangling honest, small busi-
nesses would 60 a long way towards
putting business on its feet and giving
1t the encouragement necessary to ab-
sorb into regular jobs millions now on
the relief rolls.
The big corporation does not feel
the undistributed profits tax like the
small business man. The big corpora
ton can cushion itself against that
tax, but it Is milestone around the
neck of the small business men.
While we are marking time and wait
Ing on other legislation We should re-
peal or greatly modify that tax. Such
action on the part of Congress right
now would have vitalizing and stim-
ulating effect on business all over the
country, and would do more than any,
thing else to check the business recess
sion that started go or 80 days ago"
"A fear complex is Representative