Evening star. [volume] (Washington, D.C.) 1854-1972, 1943-01-28
Hearings Scheduled
Tuesday on Plan for
Pay -You-Go Tax
House Group TO Meet
Tomorrow to Study Move
To Lift Debt Limit

p TIE Associated Press.
House committee hearings will
begin Tuesday on pay aS-you-go
tax plans, separating this sub
ject from the general tax prob
lem in the hope Of putting many
income tax payers on a current
collection basis for at least
part of 1913.
Chairman Douehton announced
also that the Ways and Means Com
mlttee would meet tomorrow to con-
slider his bill to raise the national
debt limit from $l25 900. 100000 to
$4,000 900 900, and a favorable re-
port was expected.
Taxpayers Warned to File.
The chairman said general tax
matters. including a presidential re-
quest for $4,000 100000 revenue in
addition to the $4,000 900 900 ex-
pected from present laws, probably
would be considered after a pay-as-
you-go measure was put on the
Presidents desk.
Mr.. Doughton and Chairman
George Of the Senate Finance Com
mittee have Jointly admonished that
any pay -you-go legislation would
not remove the necessity of taxpav-
ers filing their returns by March Is,
as required by present law.
Asks 20 Per Cent Withholding lew.
Preliminary to the committee ses-
sion, Representative Robertson,
Democrat, of Virginia. member of
the tax-framing group, suggested
plan calling for eraSure of lower
bracket 1912 income taxes and i'm
position of 20 per cent withholding
levy on current incomes (after al
lowable deductionS) of all taxpayers.
This was a modified version of a
proposal by Beardsley RUM, chair
man of the Federal Reserve Bank
OF New York, to skip all 1912 in
dividual income taxes. high as well
as low brackets, in attaining a pay
as-you-go basis. Mr.. Doughton is
vigorously opposed to general for
giveneSS of 1912 obligations
Offering what he termed a middle
course, MI. Robertson said:
The only income take that all
pay alike is the normal tax of per
cent and the first bracket surtax of
ID per cent, total of 10 per cent. If |
that amount of the 1912 liability be |
eliminated, all taxpayers would be !
treated alike. Yet the Treasury |
would lose much money unless a
clhct q y9tio1 Of
bility be collected at the source.
Extends RumI Plan.
"A Withholding tax of 20 per cent, |
not upon gross but upon net tax
able income, would extend the RumI |
plan to 80 per cent of the taxpayers, |
making them 100 per cent current. |
And instead of causing loss to the
Treasury would add millions of |
dollars to the Treasury receipts for
the fiscal year of 1914"
The plan was designed to put
relatively low income groups on a |
100 per cent current basis.
Mr.. Robertson said he knew of no
practical way even with full adop-
ton of the Ruml plan, to make all
taxpayers current, especially those
working at no undetermined in
come, such as professional men,
businessmen and farmers.
Mr.. Robertson also suggested:
A 10 per cent ION net income)
compulsory savings levy and elimi-
nation of the present per cent Vic
tory tax. The compulsory savings
levy would have no connection with
the withholding levy, the savings
going into purchase of bonds re-
deemable by the purchaser after the
war.
Urges Lifting of S25, 900 Top.
Erasure of the $4,000 after taxes |
salary limitation imposed by execu-
tive order.
Consideration of Federal sales
tax as means of helping raise the
SIS, 1000 900 900 in additional revenue.
Mr. Robertson emphasized that he
was offering the plan as basis of
discussion and analysis, and that
he was ready to consider any sug-
ecstions for improvement of his pro-
posals.
Opposing forgiveness of 1912 indi-
vidual income taxes for all brackets,
he said: This is not the time for
Congress to adopt any plan that will
reduce the revenue"