Evening star., 1937-05-02

! surance from Senate Finance Chair
man Harrison that no tax legislation
was contemplated during that session.
Hardly had Senator Harrison re-
turned from his next round of golf,
! Roosevelt startled lot Of people,
/ among them Senator Harrison and
Senator Long. by submitting to Con-
| gress request for tax legisla ton that
would extend the very sound policy
of encouraging a wider distribution of
wealth"
Three Levies Proposed.
Specifically, the President proposed
| three levies, as follows: % -.
in addition to the present estate taxes
| there should be levied an inheritance
/ succession and legacy tax -
recommend further the imposition OF
| gift taxes ="
! t2) %" the duty rests upon
the Government to restrict such in
comes Cthose over 81 900, ,o00) by very
| high taxes"
| t3) 90 the substitution Of
corporation income tax graduated &C.
cording to the size of corporation
income in place OF the present uni
form corporation income tax tand) a
tax on dividends received by corpora
tions."
At the same time he gave a hint
as to what would follow by saying:
We should likewise discourage un-
Wleldy and unnecessary corporate sur
| pluses. These complicated and diff
cult questions cannot adequately be
DEBATED in the time remaining in the
present session of this Congress-"
Like q good soldier, Senator Harri-
son went to work on the unexpected
chore. Like frustrated politician,
Senator Long went to work on the
administration-with gestures.
Finally, the House and Senate con-
Cured and presented Mr.. Roosevelt
revenue bill calculated to raise an
extra s249,ooo,ooO, broken down as
follows:
Surtax increases, $45, 900 900: grad
uated corporation tax, s35,OOO,0OO;
capital stock tax $44,0OO,OOO: ex-
cess profits tax, sl0,O0O,0OO; estate
tax increase. ss0,ooo,0oo; gift tax,
s2l 100000; intercompany dividends,
$29, 100000.
Included was provision allowing
corporations deductions for gifts to
charity, At an estimated saving OF
Sl5,OOO,000 to the corporations Not
included, however, was the President S
request for an inheritance tax.
1t was during enactment of this
legislation that Senator La Toilette
fought his best fight for more uni
versally applicable individual income
taxes, the Senate Finance Committee
actually voting approval of his amend
ments to reduce exemptions and to
start a sharply increasing surtax
schedule at lower point.
BY his provisions Senator La Fol-
lette estimated an increase in revenue
Of $2l5,000,000, but the committee
back-tracked few days later, with
the final result being passage Of the
plan to soak the rich" by $249 ,0OO,-
900. Despite various devices for eva
sion, revenue for the first II months
under the 1885 bill did approach ex-
pectations.
President Pleased.
That Mr. Roosevelt felt reasonably
pleased with the bill as passed was in
dicated in 4 budget summation" re-
leased on September 80, 1885, IN which
he declared:
1T is clear to me that the Federal
Government under provisions OF pres
ent tax schedules will not need new
taxes or increased rates in existing
taxes to meet the expense of its nec-
essary annual operations and to retire
its public debt"
The matter OF tackling the problem
Of overlapping taxation, however, had
not been dismissed from the Presi-
dents mind. and on November 10,
1885, he addressed the United States
Conference of Mayors, just then cut
ting its eye teeth on Federal relief
funds. After remarking that taxes
had grown up like Topsy. Mr.. Roose-
welt said:
| sThe RerePnl AAR rtsaa<Son ~ the