Evening star., 1938-04-08
Nv JOHN E. HENRY.

conference.
BY JOHN {. HENRY.
Reduction in social security taxes
was proposed in m amendment to
the Revenue Act of 1888 laid before
the Senate today by Senator Lodge,
Republican. of Massachusetts.
No immediate consideration was
given the proposal. as the Senate
nearing a final vote on the bill, quickly
rejected the House provision for rails
ing the liquor tax from 81 to s225
per gallon. The Finance Committee
had disapproved the increase and its
recommendation was accepted on a
voice vote after a brief protest from
Senator Frazier. Republican, of North
Dakota
Under Senator Lodges proposal the
old-age benefits tax payment. which is
divided equally between employers and
employees, would be graduated upward
over a longer period OF time than now
provided and would reach a ma ximum
OF per cent total tax on wages after
December 81. 1857. Under present law.
the total tax reaches a maximum of
s per cent on December 81, l948.
Frazier Urges Approval
The liquor tax increase mad been
opposed by the Treasury and the
Finance Committee on the ground it
would increase bootlegging Senator
Frazier urged the Senate to approve
the increase. which ne said would have
yielded s19000.O0O
Today's pace was slowed f1rst. when
a protracted dispute arose over pro-
posed elimination of the tax on trad
ing in commodity futures The House
bill already would reduce the levy.
Senator Frazier fought for nearly an
hour against the outright repeal with
Senator Connally. Democrat, OF Texas,
uphoiding the committee recommended
ton.
On a roll call vote. the tax was
stricken out by so to %.
Driving for passage by nightfal,
Senate sponsors of the bill planned to
continue their strategy Of discouraging
debate and speeding the measure into
conference with the House by the first
of next week.
Following disposal OF the future
trading provision, the Senate accepted
the amendment relieving American
citizens in the Philippines from pen
alties and interest due on income
taxes Of 1917 through 1920.
Behind them were their somewhat
amazing accomplishments of yester-
day in which five hours Sufficed to
gain consent of the Senate to reject
ing the undistributed corporate profits
tax. drastically modifying the capital
gains levy and approving more than
a score of other important revisions
in the Federal tax structure.
Faced With Obstacles.
Facing them were several potential
obstacles to quick approval Of the
entire measure
In the background are amend
ments likely to be called up by their
sponsors to broaden the income tax
base, to apply schedule of processing
taxes and to authorize imposition OF
schedule of import excise taxes.
Senator La Toilette Progressive, of
Wisconsin. 4 member of the Finance
Committee, is author Of the income
tax amendment by which individual
exemptions would be cut to $500 and
$4,000 instead Of $1,000 and $2,5O0
as at present. Although only mar
rowly defeated in committee and sure
to have considerable support on the
floor, this proposal is not expected to
require protracted discussion, even If
called up for vote.
Would Increase Surtax Rates.
Accompanying it is a suggestion
from Senator La Toilette to increase
the surtax rates In the middle income
classiflcations.
The processing tax plan, authored
by Senator Pope, Democrat, of Idaho,
probably contains most danger of
delay If the whole question of farm
prices and rural prosperity Is thrown
into debate.
An early indication of how much
strength can be mustered for the
tariff equalization plan, proposed by
Senator McCarran, Democrat, of Ne
vada, was given yesterday in the only
record vote Of the day. with the ad-
ministration regulars voting down q
pork import tax, Al to ~.
Not even on the undistributed
profits tax did opponents of the COM
mittee recommendations succeed in
gathering sufficient sentiment yester-
day for record vote Hearing from
Chairman Harrison Of the Finance
Committee that this system Of taxing
corporate wealth had proved unsuc-
cessful and restrictive to business, the
Senate displayed little concern at
perfunctory appeal from Majority
Leader Barley for retention Of the
House notifications of this levy and
then accepted . voice vote against it
without question.
The important capital gains tax
drew even less attention as the read
ing clerk tore through this section of
the bill and the presiding oficer
gaveled acceptance Of the committee
m0dif4ca kions u{fhaa,k v,erA ~ Az.