Evening star., 1941-10-22
Social Security Tax
OF So on Workers
Being Considered
Employers Share
Would Be Boosted
To Same Figure
By the Associated Press.

By the Associated Press.
Treasury sources said today the
administration was considering a
request to Congress 20 hike the en-
ployes share of social security taxes
from l per cent to per cent of his
paycheck.
Under this plan, if adopted, EN-
ployerS would increase their contri-
button to old age pensions from to
2 per cent, and would continue pay
ing 3 per cent for unemployment
insurance, making their total also
5 per cent. At present, the en-
ployes pay no Federal unemploy-
ment tax, only l per cent for old
age pensions.
Even while this far-reaching pro-
posal was under discussion, how
ever, a possibility developed that the
House soon might take an extended
recess which would force postpone
ment, until after the first of the
year Of not only the projected boost
in social security levies but also a
contemplated revision of admins
trative provisions of the general tax
laws.
Recess BY Thanksgiving Sought.
Speaker Rayburn said the leader
ship was hopeful that the House
would be able to recess not later
than Thanksgiving, for the balance
of the year. He pointed out, though
that such a recess would not block
committee study of both measures
Exact details of proposed social
security revisions were withheld,
officials said, pending the Presidents
reaction to suggestions of the Treas
ury, Federal Security Agency and
others.
The increase in taxes, however
was represented as the principal
change. Other recommendation deal
with possible methods of making
farm laborerS, domestic servants,
government employees, self-employed
persons and employees of educational
and charitable institutions eligible
for old-age pensions.
Another step would federalize the
unemployment compensation sys-
TENS now operated by the 49 States.
The proposed change in taxes
would boost the Federal revenue
from social security from the S700.-
100000 collected last fiscal year to
approximately s5,0OO,O0O,O0O a year,
officials estimated
The agitation for higher social
security taxes has come from the
Treasury, where officials feel that
since the social security program
calls for ultimately higher levies. the
taxes should be raised Immediately
as an anti-inf1ation measure.
The experts here say that the
extra purchasing power which is
likely to boost prices of ordinary
commodities toward imitation levels
Is in the hands of wage-earners, and
that part of this purchasing power
should be diverted
Held Legitimate Diversion.
The Treasury officials argue that
social security taxes are a legiti-
mate method of diverting more pur-
chasing power because the existing
law provides that old-age pension
taxes should rise gradually to 3
per cent each on employees and en-
ployers beginning in 1949. Because
OF its anti-inf1ationary purpose.
they also claim justification for
boosting the employees share more,
proportionately. than the en-
ployer's at this time. They count
on excess profits taxes to keep the
employers from getting too rich.
No comment was available from
Social Security Board circles. but
that agency's attitude was repre-
sented as somewhat aloof to the
tax changes, because of a fear of
entangling the social security pro-
gram with the defense program or
the fiscal needs of the Treasury.