Evening star. [volume] (Washington, D.C.) 1854-1972, 1943-02-20
RumI Plan Bdckers
Grid 10 Renew Fioht
For Pay as You Go
Ways and Means Group
Directs Subcommittee
To Draw Compromise
b the Associated Press.

Defeated in the House Ways
and Means Committee, but ap-
parently undismayed, supporters
OF the Ruml pay-as-you-go plan
today marShaled their forces to
fight anew for cancellation of a
years individual income tax OBJ
legations.
After three weeks of study the
committee yesterday voted down all
proposals before it for current tax
collections and set up a subcom-
nittee to draft an acceptable COM
promise.
A modified version Of the plan
originated by Beardsley Ruml,
chairman Of the Federal Reserve
Bank of New York, was among the
proposals rejected, but its sponsor
in the committee, Representative
Carlson, Republican, of Kansas, said
he would continue Ito press for that
kind of bill" One Representative
was surprisingly large"
Chairman Doughton said the COM
nittee's action did not indicate a
let-up in the effort to devise a cur
rent collection system for the a.
100000 income taxpayers. In addi-
ton, there were definite signs that
some pay-as-yo"-go system with
substantial abatement of one years
taxes would be approved.
Cooper Heads Subcommittee.
The i've man subcommittee,
headed by Representative Cooper,
Democrat, of Tennessee was in
structed ito produce new bill in
Guiding the principle of pay-as-you-
60 and collection at the source"
The committee thus went on rec
ord as favoring not only pay-as-
you-go system, but withholding
levy. as a means of making weekly,
semi-monthly or monthly income
deductions which would be accumu-
lated and applied against actual
taxes computed at the year end.
Other plans voted down by the
committee included two suggested
by Mr.. Doughton and one by Rep
resentative Robertson, Democrat, OF
Virginia.
Under Mr.. Robertson's proposal
the per cent normal and first
bracket surtax of Is per cent on
1912 income would be Cancelled out
for all taxpayers to ease the transit
ton to a pay-as-you-go program. |
This would wipe out last years |
taxes completely for millions OF
persons with small incomes and |
cancel the levy against the first |
$4,000 of taxable income for all |
persons.
Mr.. Doughton's first suggestion
vas that the pay-as-you-go transit
ton be facilitated by applying the
much softer l94I rates and exemp-
tons against 1912 income, with the |
remaining 1912 obligations to be
Amortized over limited number |
of years while the taxpayers also |
were renting on current years |
taxes. This would have abated all |
or a substantial part of 1912 taxes !
for millions of persons with incomes |
under $4,000.
Second Compromise Plan.
As second possible compromise
the chairman suggested the abate-
ment of half the 1943 tax obligation.
with all of 1912 and half of 1943 to
be paid in full.
Mr.. Carlson, who introduced a
bill containing the Ruml plan early
in the session, later modified his
proposal to provide that a taxpayer
would be obligated only for the one
of the two years 1912 or 1943 in
which his taxable income was high |
est. A clause provided that all serv-
icemen with incomes under $4,000 |
should have their 1912 taxes abated. |
The original Ruml plan proposed |
TO cancel the 1912 tax year COM
pletely.
Earlier, the Ways and Means Com
mittee made its rejection of Presi-
dent Roosevelt's salary ceiling pro-
gram ofiicial-"definitely and very
loudly" according to Representa-
tive Disney, Democrat, of Oklahoma.
1t adopted Mr.. Dlsney's plan to
repeal the Presidents order limiting
salaries to $4,000 after taxes and
peg them instead at their prewar
levels by the same 15-to-l0 vote with
which it approved Mr.. Disney's move
originally last Saturday, before Mr.. !
Roosevelt's counterproposal was re-
ceived. Reconsideration was necessi-
tated yesterday by parliamentary
technicality.
Mr.. Roosevelt pad offered to re-
scind his limitation on salaries If
Congress would approve super-tax
designed to limit all individual in
come to s25 900 net for single per-
sons and $4,000 for married couples.
Instead the committee voted that
salaries above SIS 900 might remain
at the levels existing before the Pearl
Harbor attack, and that no salaries
which were below that figure then
could rise above 1t now.