Evening star., 1940-05-19
Treasury Has Scores
OF Tax Plans 10 Pay
For Defense Costs
Borrowing Thought Chief
Quick Method, but
levies Must Come
BY the Associated Press.


Treasury files contain scores OF
tax proposals which could be used
to pay for the new $1,182 900 900
defense program, with levies rang
ing from stiff increases in income
taxes to imposts on bachelors.
President Roosevelt has left to
Congress. for the present at least,
the problem of paying for the ex-
traordinary expenditures.
Privately. administration circles
regarded borrowing as the only inn
portant. method to be used i'm
mediately. But new taxes, possibly
at the next session of Congress after
the presidential election is out of
the way, were not ruled out. In
creasing the Treasury's $45 900 ,000,-
600 debt limit to make borrowing
possible was believed by most off,
Gals to be virtual certainty, at
least by next year
Books Might Be Juggled.
A third group of possible methods,
mostly opposed by the Treasury as
trick methods but favored by
various members of Congress, in
wolves using idle assets of the Treas
ury. This group includes taking
money out of the $4,000 900 900
stabilization fund, spending part of
the estimated $4,000, ,000,0 paper
profit" which the Treasury has
made on silver purchases, printing
$1,000 100000 of "greenback" paper
money as authorized in 1888, and
converting into cash some Of the
Treasurys 1862 $50 900 interest in
Government corporations.
Last January, Mr.. Roosevelt Or
dered Government corporations to
give the Treasury s700, ,000,0 900 on ac-
count within the next year.
officials indicated that no sub
stantial amount of cash could be
realized on the Treasury's $l8,800.-
000,000 gold hoard, because nearly
all the gold purchased in recent
years was Immediately cashed in at
the Federal Reserve Banks.
Treasury Studies Tax Ideas.
The Treasury has stated that 1t
has not been asked yet to draft any
tax proposals, but corps of officials
there studies such proposals regu-
larly.
One source of tax ideas they use
is a list of what foreign countries
do. Files of this sort show bachelor
taxes in Italy and Germany, a tax
on trees in Siam, on bills-the kind
that clutter up the first-of-tile-
month mail-in France, on race-bet
bookmakers in Australia, and on
funerals in Rumania.
One tax thought current in WASH
ington, which the President is re-
iably reported to like, is Super
tax" on incomes.
This tax, usually proposed at 10
per cent, would be determined by
adding that percentage on to what
ever income tax person or corpora
tion would regularly pay. At 10 per
cent, this levy would raise about
$500, ,000,O a year.
Tax Base Might Be Extended
Senator La Toilette, Progressive,
Va VAoNOIASlIl, dA1u SO11lc duIlllIlIS.
tration officials have favored at
various times broadening of the
income tax base" This would mean
reducing personal exemptions =
probably from $2,500 to $4,000 for
heads of families and from $1,000 to
$500 for single persons-and in
creasing tax rates on moderate in
comes, up to 100000. It has been
estimated these two proposals to-
gether would yield slightly more
than 5000, 1000, 900 a year.
A general sales tax, similar to
those levied by many States, also
has been suggested. However, pres
ent Federal excise taxes on liquor, to-
bacco, gasoline, automobiles, radios,
theater admissions and many other
items already have taken the cream
of this source. A per cent sales
tax on everything, the stiffest rate
proposed, would raise about 81 ,00O,-