Evening star., 1943-03-06
Tax Abatement
Issue Put Up TO
Full Committee
House Subcommittee
Votes Pay os You Go,
Evodes Cancellation
BY the Associated Press.

BY the Associated Press,
The issue of whether Amer
lca's individual income taxpay-
ers will have all of one years
income taxes abated today
shaped up for another vote in
the House Ways and Means
Committee.
A subcommittee, set up to draft
a "pay-as-you-go" compromise after
the full committee rejected the skip
a-year phase of the Ruml plan two
weeks ago, approved yesterday a
system to put all of the $4,000, 900
income taxpayers on a current COL
lection basis July /. But it dumped
back into the full committees lap
the controversy over how much of
q years taxes should be Cancelled.
Representative Carlson, Republi-
can, of Kansas, author of a bill on
the Ruml plan, said he would ask
the committee to vote again on a
modified proposal to skip a full tax
year.
Although opposing outright can
collation. of 1912 taxes, majority of
the IS committeeman have indi-
Gated willingness to abate part of
these obligations to ease the transi-
ton to the pay-as-you-go system,
but they have failed to agree on
how much.
Full Committee Called.
Chairman Doughton called the
full committee to meet Monday to
tackle the problem again.
Under the subcommittee plan.
all taxpayers would file their 1912
returns and pay the first and second
installments March Is and June
Is, as usual. Beginning July /, it
recommended that individual in
come taxes be collected in this
manner:
l. Wage and salary earners would
pay Withholding levy of 20 per
cent covering both income and VIC
tory taxes) on the taxable portion of
their pay envelopes and salary
checks through weekly, semi
ly or monthly deductions. These
collections would nat be additional
taxes, but APPLIED 10 actual taxes
computed at the. year end. The
wage and salary earners would file
income tax returns the subsequent
March is as usual
2. SerVcemen, domestic servants
IN the home and agricultural labor
ers would be exempted from the
Withholding levy OF 20 per cent, and
remit on taxes as stipulated in pro-
vision No. 4.
Payments by Farmers.
3. Farmers would pay two-thirds
OF their estimated current-year liza
bility tincluding income and Victory
taxes) at any time on or before De-
cember 81 OF the current year and
the remaining amount when the an
nual return is filed March is of the
following year. The extent of paw
ment in 1943 cannot be determined
until the amount of abatement on
1912 taxes is decided on by Congress
T. All others would be required to
make quarterly returns and pay
each quarter-one-f fourth of their
estimated annual tax Gncome and
victory for the current years in
come.
Servlcemen abroad now have their
taxes deferred until they return
home.
If the plan suggested by the SUBJ
committee were adopted by Congress
without solving the abatement
problem, taxpayers would have a
double liability in the last half of
ls43, paying on current 1943 income
taxes and on the last half of 1912.
However. Chairman Cooper of the
subcommittee said the full commit
tee would decide whether all or part
OF years taxes would be Cancelled.
The subcommittee week ago ap-
proved tentatively the 20 per cent
withholding against taxable portions
OF wages and salaries. and its action
yesterday brought under pay-as-
you-go virtually all other classifica-
tions Of income.
In writing the provision for farm
ers. the subcommittee borrowed
language from Canada s new system.
The Withholding tax of 20 per cent
on wages and salaries includes a 3
per cent Victory tax above an ex-
emption of 1924 annually, regardless
OF the number of dependents, plus II
per cent on wages and salaries above
exemptions of $3.50 for single per-
son and 81 ,320 for married persons
plus $685. for each dependent.