Evening star., 1943-10-04

programs. he said, will absorb nearly
$1,000 100000 OF the excess and
added that other forms of non-
inf1ationary savings. such as life in
surance, must be subtracted from
the potentially dangerous dollars. -
Secretary Morgenthau testified
that while four-fifths of all income
is going to people earning less than
$4,000 year, Income is not dis
tributed in such way that it can
equitably be drawn of in huge
quantities straight across any given
income level"
Would Lessen Impact.
The postwar refund provision was
suggested by Mr., Morgenthau to
lessen "the ultimate impact Of the
increased tax on the lower income
groups"
IF such device should be used +"
the Secretary said, 1t is suggested
that the taxpayer be permitted to
purchase with his refund credit
fully paid-up life insurance policy.
There should also be a provision
/ permitting the immediate use for
/ tax payment of any postwar credit
| in cases where the taxpayers income
has not increased substantially"
mended that the rate at which taxes
are withheld at the source, now 20
per cent after exemptions be grad
! uated to further simplify collection
| machinery.
Would Simplify Procedure.
/ Graduated withholdings," he said,
could keep millions more OF our
| taxpayers on strictly current,
paldup basis, by covering the full
liability in all brackets instead of
just the first bracket, as at present.
This would materially reduce the
number of persons required to file
/ troublesome declarations of esti-
mated tax"
In suggesting the increased cor
/ poratlon taxes Mr. Morgenthau said
That corporations will have added
10 their capital out of earnings an
estimated ,o0O,0OO,O00 during the
three years l941-1 -1943, but added that
small corporations should be given
special favorable treatment"
He suggested that exemption for
estate taxes be reduced from $50 900
to 100000, and that both estate and
gift tax rates be increased through
out the scale.
VI the tax program as whole.
MI Morgenthau told the committee
enactment would serve the Nation
In many ways adding:
1T would enable US to finance
considerably larger part of our huge
war costs through taxation. and bv
so doing would relieve us and our
children of burden which could
materially retard postwar progress.
Discusses Security Levies.
1T would materially simplify our
tax structure.
1T would strengthen us in our
war in imitation as we'll as in our
war on the Axis"
Discussing the social security pro-
gram in separate statement, Mr..
Morgenthau said legislation already
pending would increase such taxes
paid by employees approximately So
10O,0OO, 600 and that the necessary
additional employers payroll tax
would raise another 1,600,0 900 900.
Asserting that such substan-
tlal increase in payroll taxes would
be OF immediate service in diminish
ing the threat of inf1ation," Sec
retary Morgenthau added:
There is no pretense on the part
OF loW-lncome people that they could
comfortably pay these additional
payroll taxes. 1t is known by them.
and admitted to be a sacrifice: but
1t is felt by leaders and spokesmen
for many such people, and by those
OF the people themselves with whom
I have talked, that because we
would be expanding social security's
advantages and permitting workers
to invest in their futures, this sac
rifices will be made willingly"
Would Hit Luxuries.
A large portion of any new rev.
enues probably will come from added
levies on "luXuries
The administration, as explained
to the Ways and Means Com
mittee, wants the excise on liquor
raised from s6 to $40 a gallon. One
lawmaker estimated the $40 figure
would mean-on the basis of 30
drinks to a gallon-that one jigger
would carry tax Of 121a cents.
Other exciSe changes planned in
the new program:
Beer. 81 to $40 a barrel; wine,
10 to so cents gallon; cigarettes,
$3.50 to IS per thousand (no differ
ential as to sizes; cigars, rates up
to add $66 100000 in revenue; to-
bacco Smoking. chewing and snuff,
lS to "a cents a pound.
General Admissions-10 per cent
to 80 per cent; cabarets-5 to 80 per
cent: bowling allevs-k1n a. al1sv