Evening star., 1943-04-25
Administration Bill
Cancels 44Per Cent
OF 1912 Tax Liability
Forsives About 5 Billion;
- Democrats Ask Passage
81: b To Show Nations Unity

70 Democrats Ask Passage
d: To Show Nations Unity
By the Associated Press.
- A new pay-as-you-go tax bill,
eancelling approximately "A per
cent of 1912 tax obligations,
emerged from the Ways and
Means Committee yesterday as
Che Democratic majority sought
to compromise the House dead
lock.
House Majority Leader McCor-
mack promptly bid for Republican
support for the plan, asserting it
results in forgiveness of about S.
QDO,o0o,0oo" and holding out this
olive branch of conciliation:
$ MY Republican friends need not
fear that such action would be con-
Grued as a defeat for them or a
Victory for the Democrats. 1t would
BE a powerful message to our enc
Hlies of legislative unity It
would be construed as legislative
Nctory for all of us"
|. Republicans Plan Fight.
But the measure gained commit
tee approval on voice vote, with
the outnumbered Republican men,
bers sitting silently by--and their
silence then and statements later
Eerved notice they will continue to
Urge version of the Ruml skip-a-
tax-year bill.
Indeed, the action which will bring
the second floor showdown on taxes
came only after the committee, also
Focally, had rejected the modified
Fuml plan and another compro-
mise advanced by Representative
Robertson, Democrat, of Virginia to
shate the per cent normal and first
13 per cent surtaX on AZ income
BY agreement. the Ways and
Means bill will reach the floor for
q single day of general debate or
May 3, but free-for-all fight is
Expected to develop the following
DAY, when both the Republicans and
Mr.. Robertson expect to offer their
substitutes, with the likelihood that
still other compromises may be
proposed.
, In an effort to get the Nations
taxpayers on current basis, the
Democratic plan-in contrast to its
previous no abatement" measure
calls for:
Democrats Proposal.
l. A 20 per cent withholding levy
on wages and salaries, beginning
July !.
.. Payment of 1912 individual tax
obligations on the basis of the lower
rates and the higher personal ex-
emptions of 1941.
3. Application of payments already
made on 1912 taxes to the tax bill
on income earned this year.
4. Provision that the payments of
last years taxes may be spread over
a three-year period to tighten the
load.
5. Discount of per cent, how
ever, for those who pay off their
complete AZ obligation by March
Is, 1914, and of per cent for those
who have paid in full by that date
in 1945.
Mr. Robertson reported that the
Treasury informed the committee
the Democratic plan would remit"
4,4OO 100000 of total 1912 levies,
leaving approximately $500 900 900
OF that years obligations remaining
clue, He contended its adoption
would preclude any increase in in
dlviaual tax rates this year, and
any search for new revenue would
have to turn to general sales tax
or an excess profits tax on indi-
vldual wages and salaries. similar
to that now assessed on corpora
tlons. Any general sales tax, he
argued, should be accompanied by
increased exemptions for those in
lower income tax brackets.
knutson Predicts Bill Defeat.
Representative Knutson, Repub-
lican, Of Minnesota. champion Of
the Ruml cause. declared the COP
committee members would file
minority report on the Democratic
plan. AS to his opinion On how that
plan would fare in the House, he
said, 1T will go like house afre-
in a heavy rain" Mr.. Knutson add
ed that the Republicans did not
attempt to force record vote in
committee yesterday lin order not
to embarrass the situation" 1t ap-
peared likely the Republicans hoped
to win over some of the Democrats
and wanted to keep from commit
ting them yesterday.
The Republicans are reported to
be debating whether to fight for
the original Ruml plan, cancelling
a complete years taxes, or a modi-
fec rs per cent version of it.
The text of Mr.. Mccormack S
statement follows:
The bill reported by the ma
jority of the Ways and Means Com
mittee is fair and practical solu-
tion of the problem. 1t enables the
great bulk of those who will be sub
ject to pay as you go or the with
holding tax to get on such a basis
in a sound manner. Applying the
194l rates and exemptions to 1912
taxable income is much preferable
and fairer than the plans offered
by the Republic",l members of the
committee.
Raps Republican Proposal.
Their last proposal placed no
taxpayer subject to the 1912 revenue
bill on a pay as you go basis. The
Republican bill favored the big in
come taxation, that taxes should
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