Evening star., 1943-10-07
Tax Group in House
Unmoved by Vinson's S
Plea 10 Boost Leyies

threatens the Nation, voiced by
Economic Sterilization Director
Fred M. Vinson, failed today to
klndle congressional enthusiasm
for the administrations S1O,5OO,-
100000 new tax program.
Mr.. Vinson pleaded apparently in
vain for the program before the
House Ways and Means Committee
declaring the additional taxes were
"a minimum requirement. to head
of imitation and bring in needed
wartime revenue.
However, the bipartisan opposi-
ton to so large a tax increase con-
tlnued unabated and leading men,
bers OF the Ways and Means group
indicated that bill would be drawn
for sharply-reduced figure, prob
ably nearer $5,000,0 100000.
Members of the committee repre-
senting both parties expressed over
Nheming opposition to the Treas
ury program, which would relieve
about 100000 present income tax
payers in the W-income brackets
from payment of taxes on next
years income and which would in
crease the burden progressively on
persons earning more than $4,000
a year.
Representative Robertson, Demo-
crat, OF Virginia, committee men,
ber, charged that the administra-
tlons bill would relieve persons
earning 35 per cent of the Nations S
income next year of all new f1nan-
cial responsibility toward the war
effort and that the untouched in
come would lead the way toward
inf1ationary movements which the
Treasury is trying to avoid.
The Virginian said he agreed with
Mr.. Vinson that excess purchasing
power must be removed, but he
said he believed the way to do it
was through a general sales tax.
Under the Treasury plan,' he
pointed out, no new contributions
would be asked from those earning
below Sl,700 a year and all persons
earning up to $4,000 would be asked
to make some small contributions
and will receive refunds after the
war amounting to more than they
paid in.
Warns of Later Burden.
"If exemptions are raised after
the war, which they probably will
be. the net result will be that the
$500 100000 which the Treasury
proposes we refund out of the So
100000 900 in new income taxes
would be saddled later on the backs
of the middle and higher bracket
taxpayers who are now carrying the
major portion Of the war burden"
Mr.. Robertson pointed out that
It is estimated persons earning less
than $4,000 a year will get $55 ,000,-
100000 Of the national income next
year-an amount greater than the
total national income in any of the
years 1882, 1888 or 1894.
Mr.. Vinson pleaded that the pro-
gram was necessary to ward off in
fl2 ton and to keep the Nations war
expenditures paid up by one-haf
on current basis.
Mr.. Vinson produced figures to show
there will be only 100000, 900 900
worth of goods and services available
next year. while the national income
is expected to rise to $l36 900 100000
The remaining $46,O0O.OOo, 900, he
contended, is an inf1ationary gap
unless absorbed in taxes War bonds
or other savings.
Ninson Against Sales Tax.
Some members of the committee
have advocated 10 per cent sales
levy, but Mr.. Vinson argued that
such a tax would in itself be in
f7ationary in that it would raise
the cost of living about per cent
and would create accelerated de-
mands for wage increases. Chair
man Doughton said he would sup
port sales tax only as a last
resort.
Mr.. VinSon warned the committee
that he did not believe initiation can
be prevented without a stronger
fiscal policy.
Congress has provided effective
machinery for controlling prices and
5tablllzing wages and salaries" he
said. The additional tool of in
creased taxation is essential if we
are to maintain stability in the
wartime economy"
He pointed out that failure to pre-
vent initiation would increase the
cost of the war and would lower
the standard of living for millions
Of white-collar workers dependent
on fixed salaries for their livelihood.
Believes People Willing.
He said he believed the American
people would accept added sacrifices
as called for under the Treasury
program.
The American people do not want
luxury and ease while their sons are
dying" he said.
In reply to a question by Repre-
sentative KnutSon, Republican, of
Minnesota as to whether the pro-
gram was designed ito control in
f1ation or events in the offing," Mr..
Vinson denied he had politics in
mind"
IF you let people earning five
siXths of the national income off
very easy" Mr., Knutson said. then
the plan resolves itself into a pro-
gram to soak the rich"
Representative Disney, Democrat,
OF Oklahoma, noted that no admin
istration witness so far mentioned
the possibility Of making savings in
expenditures"
Before Mr.. Vinson testified yes
terday, Mr.. Knutson issued
statement calling attention to
study made by Representative Ia
ber, Republican, of New York, in
which 1t was asserted the Treasury's
S10,500,000.0 tax program could be
trimmed by 40 per cent through
economies which would not be detri-
mental to the war effort.
Chairman Doughton objected to
the tax program on the ground that
there would not be enough dollars
left. particularly in business, to keep
business in operation, to maintain