Evening star., 1939-05-25

0y President RooseDelt, cabinet
members and other officials,
there has been considerable con-
fusion in recent months as to the
administrators attitude to,pard
tar rertston designed to remope
business deterrentS. Chairman
Harrison OF the Senate Finance
Committee has been the leader
OF the congressional group insist
ing on repeal of the undistributed
profits tar.
BY tbs Associated Press.
Secretary of the Treasury Nor
yenthau reported today congressional
leaders had agreed on a tax program
with President Roosevelt that would
dehnltely' contribute to business
recovery.
The Treasury head said the tax
conference held at the White House
yesterday cleared up final details of
corporation tax revision program
and that no further conferences
were expected.
He replied with an emphatic "yes"
when asked if the tax program was
ready to go before Congress.
He added, however, that he did not
yet know on what date the House
Ways and Means Committee would
summon him to present the plan.
The President conferred yesterday
with Chairman Harrison of the SEN
ate Finance Committee, Senator
Byrnes, Democrat, of South Caro-
ma, and Representative Cooper,
Democrat, of Pennsylvania.
Good Will All Around"
Secretary Morgenthau said he
could report that more progress
has been made in the last couple
OF days than was made in the last
couple OF months toward a solution
OF the tax problem"
He added that good will all
around" was responsible for the
agreement after months of conflict
ing statements by the President.
treasury officials, legislators and
others as to what ought or could be
done about taxes to help business.
The Secretary explained that when
tne house committee calls him to
testify, he will make a general state
ment about tax revision and then
Undersecretary John w. Hanes will
take charge of the Treasury's par
ticipation in the tax hearings.
Mr.. Hanes is a former Wall Street
broker and former member of the
Securities and Exchange Commits.
sion, who has been active for mora
than year in promoting friendship
between the administration and
businessmen.
To Seek Party Unity.
Before the Morgenthau announce.
ment, Senator McNary of Oregon,
the Republican leader, disclosed he
would ask his % party colleagues
to determine their stand on tax re-
vision in advance of Senate debate
and then vote as unit.
Senator McNary's plan would
match proposed Democratic STRAIT
egy OF holding a party conference
on suggested tax changes before they
are presented to the Senate.
Although Democratic leaders said
their plans for a caucus were in
definite, Senator McNary indicated
he would call one on any corpora
ton tax bill sent over by the House.
The latter must act first on revenue
measures.
A Democratic caucus would be
designed to hasten action on the
legislation and to preserve party
unity on an issue which has found
members divided in the past.
Quick Approval Seen.
There were strong indications that
If the House adopts business tax
revision plan, it will be given quick
approval by the Senate Finance
| Committee.
Chairman Harrison, who advo-
Gates limited changes in corpora
ton levies, was reported to have re-
ceived encouragement for this pro-
gram at yesterdays conference at
the White House.
The President was represented,
however, as having reiterated his
concern that there should be no re-
duction in revenues and that no
tax leaks" should be created.
A compromise plan under con-
sideration would permit the present
undistributed profits tax of 2hz per
cent to die December 81 and would
establish maximum tax of 18 per
cent on corporation income. The
maximum now is 10 per cent, de-
pending on the amount of profits
distributed.
Loss Carry-0ver Provided.
The present preferential tax treat
ment for small businesses with in
come of less than s25,0Oo would be
retained.
Other changes would extend loss
carry-over provisions to three years
instead Of one, and would allow
corporations to revalue their capital
stock, increasing the amount paid
under the low-rate capital stock tax,
but decreasing the total paid under
the higher-rate excess profits tax.
There were authoritative reports
that the Presidents attitude was
such that Congressional leaders were
encouraged to believe a program
calling for removal of so-called busi-
ness deterrents could be pushed
through In the next six weeks with
a minimum of opposition.
Senator Byrnes, who was credited
with bringing about the meeting In
the interest of outward Democratic
harmony on an early adjournment,
would not comment.