Evening star., 1941-09-03

", w Elm LCDA L, L
to have deductions sufiicient to obvi-
ate any tax payment.
Draws Comparison.
To sustain his argument that the
pending bill bears too heavily on
the individual as against profits
from the defense expenditures, Sen
ator La Toilette drew a comparison
between the revenue situations Of
1917 and 1912. He continued:
In many respects the present
fiscal situation is directly parallel
with the World War tax problems
two decades ago. The war then
and the defense program now have
entailed unprecedented government
al expenditures. which. in turn, re-
quire unprecedented general taxa
ton. Production and profits have
scared. Just as in World War /, the
Government is struggling to bolster
the Treasury revenues by imposing
new taxes. ""'
Despite the gross inadequacy Of
tA4S baA OIL Ill IItC WOI w i,
how does it compare with the pres
ent tax structure?"
The Senator then submitted
table. which, he said, showed that
since 1920 excise taxes have almost
tripled and individual taxes have
more than doubled, while corpora
ton taxes ARE yielding only slightly
more revenue than in 1920" 1t is
significant, also, he added, that the
bulk Of the present corporate tax
levy is being derived from the in
come tax instead of the excess
profits tax.
Senator La Toilette told the Sen
ate that "the singularlv harsh
treatment accorded the low-income
taxpayer under the committee bill
is entirely reversed when dealing
with the wealthy taxpayer be-
qUcathing huge estates and gifts"
Exceptionally generous exemp-
tions of $4,000 are allowed" he
continued, "53 times as great as
the exemption for a single man
under the income tax recommended
tion--and only moderate rates are
applied. Although the Treasury
proposed to lower these exemptions
to $4,000, neither the House Ways
and Means Committee or the Sen
ate Finance Committee would
concur"
Assails Auto Use Tax.
Senator La Toilette also attacked
the fiat $5-a-year tax on the use
Of an automobile, pointing out it
would fall with equal weight on the
owner OF q small and a large car,
and on the motorist who drives 500
miles year, or 10000 miles. The
average motorist, the Senator said,
Is already paying more than his
share IN gasoline and excise levies.
Reliable estimates. he said, showed
that In 1889 each motor vehicle
paid an average tax of s50.82. If
further automobile tax is neces-
sary, he advocated that the excise
levy on new cars be made 10 per
cent instead Of the per cent rate
In the bill.
Criticism of the new tax measure
also came from Senators Bailey,
Democrat, OF North Carolina, and
alsh. Democrat, of Massachusetts,
but, like Senator Clark, they said
they would vote for it in the alb
sence Of something better.
Senator Bailey called the lepisla-
ton the worst tax bill in history"
and saw its burdens falling on more
than $4,000 900 persons.
Yield Held Insignificant.
1T cuts exemptions to the bone,
and then cuts into the bone" he
asserted.
Senator Walsh found these de
fects'-the measure would yield in
sumcient revenue, would afford no
protection against imitation. would
not prevent excess profits resulting
from Government contracts and
would impose new burdens be-
fore possible economies in Govern
ment spending were affected.
Although agreeing with Treasury
experts that the bulk of additional
revenue yielded by lower exemptions
could come from persons already
paying taxes, Senator Clark added:
While / always have favored
broadening the tax base and while
I believe every one should contribute
something to the Government. it is
unfair just arbitrarily to increase
taxes on the lowest income groups
without at the same time attempt
ing to revamp scientifically the ex-
cess profits, corporation and other
taxes"
Reaches Small Incomes.
The reduced exemptions would
bring under the income tax struc-
ture single individuals earning sI490
week and married persons with q
$3.50 weekly income.
This bill, burdensome as 1t will
be-" Senator Clark declared, "is
merely drop in the bucket of the
expenditures already made and in
the making. 1t is simply a forerun-
ner for even more drastic taxation.
1t is entirely conceivable that a cap
ital levy will be necessary. ..
I'VE may as well face the fact that
unless there is an immediate and
comprehensive overhauling of the
entire tax structure, none of the
taxes now being imposed in the
guise Of emergency levies will ever
be removed in our lifetime or the
lifetimes Of our children and grand
children"