Evening star., 1938-04-26
BY JOHN c. HENRY.

and salaries.
BY JOHN c. HENRY.
House and Senate conferees COM
pleted agreement this afternoon on the
$500, 100000 revenue act of 1898.
Containing important notifications
Of the present tax laws. the compro-
mise measure is expected to come be-
fore the Senate for acceptance late in
the week, with House action to follow
Immediately
The legislation in the form finally
agreed to was hailed by Chairman
Harrison of the Senate Finance Com
mittee as the most forward step in
years toward helping employment by
private initiative through a fiscal
policy of the Federal Government"
Through its generous and fair
treatment" Senator Harrison said,
especially with respect to capital
gains and liquidation, it should result
in the releasing of billions of frozen
securities to be invested in private
enterprise and development
Increase in Receipts.
"Under normal business conditions"
he added. 1.-The tax bill should in
crease receipts to the Government. +"
Although the term normal busi-
ness conditions" was not defined, it
Is known that the estimates of yield
from the tax structure as now about
to be amended we're based on indices
OF business activity some IS per cent
above the present level.
In their final session today the
conferees decided to eliminate the
Senate amendment permitting tax
alton Of income from future issues of
Federal securities. The action was
taken at insistence Of the House dele
cation on the grounds that separate
legislation would take care of exemp-
tions granted all public securities and
all public salaries
Such legislation was asked yester-
day by President Roosevelt in a mes
sage to the Congress.
Senator Borah, sponsor of the
amendment, may appear before the
conference later to ask reconsideration.
1t was learned that the conferees
have agreed to the House provision
raising the liquor tax from 50 to
$225 per gallon, an increase vari-
ously estimated to yield between
Sl9,000,000 and $50. 100000 The Sem
ate had rejected this proposal, but
earlier compromises on corporate tax
alton had reduced the potential yield
OF the measure to point where the
liquor tax increase was believed nec-
essary.
Working quickly in order to COM
plete their agreements on the legis-
lation early today, the conferees are
understood to have agreed to Senate
provisions relating to estate and gift
taxes and to Senate provision ex-
empting holding companies in liquida-
ton from certain transferred taxes.
With regard to estate taxes. the
House had combined two existing
schedules and had reduced credits
allowed for payments to individual
States. The Senate, however, favored
retaining the present law in this con-
nection as well as in the matter of
deductions allowed for gifts.
The amendment relating to utility
holding companies had been SUBJ
mitted by the Securities and Exchange
Commission. 1t would apply to liqui-
dations proceeding under the so-called
death sentence" clause.
Tho Eouee nopfaro,e ,,r.,.;,.S 4. I.
understood, in retaining the present
excise tax on tires and tubes. which
had been reduced by one-third in the
Senate.
1t was also reported that House
conferees had refused to accept a
Senate amendment which would have
ended the requirement Of swearing to
individual tax returns before a notary
public.
Senator Barkley of Kentucky, the
Democratic floor leader said mean
while 1t was ''in the realm Of doubt
whether the Senate would approve
President Roosevelt's tax exemption
recommendations.
Mr.. Roosevelt suggested yesterday
that Congress enact a bill removing
all income tax exemptions from future
Federal and State securities issues and
salaries. Legislators, while generally
favoring hts objectives, disagreed over
the question Of whether they could be
effected by mere legislation or whether
Q constitutional amendment would be
necessary.
Similar Plan Defeated.
A plan similar to that outlined by
the President was submitted to the
Senate by Senator Clark, Democrat
Of Missouri when the tax revision bill
was under consideration and was
voted down, II to %. Administration
followers, including Barkley, were
among the opponents.
Mr.. Clark said today that Mr.. Roose-
velt's message might bring many Sen.
ators around to supporting tax-exemp.
ton legislation. Mr.. Barkley, however
said the previous vote made general
change Of sentiment appear doubtful
A bill to end existing tax exemp-
tions would have to originate in the
House Ways and Means Committee
which initiates all revenue legisla-
tion., Chairman Doughton, Demo-
crat Of North Carolina, of that group,
declined to predict whether action
could ~ faka,a .>.sS>-