Evening star., 1945-10-16
Deeper TaxCuts
For individuals
Urged byC|0
Murray Spokesman
Also Asks Retention
Of Excess Profit Lew
By J. A. O'LEARY.

Deeper tax cuts for individ-
uals, especially in low-income
brackets, and retention of the
excess profits levy for another
year were urged today by a CIO
spokesman as the Senate Finance
Committee continued hearings
on the $4,000, 100000 revenue re-
duction bill.
Speaking for Philip Murray, CIo
president, Clifford McAvoy told the
committee the CIO program would
give individuals tax savings of S.
500 100000, but retention of the ex-
cess profits tax during 1916 would
bring in s2,5OO,OOO, 900.
Senator Vandenberg, Republican,
OF Michigan brought out that esti-
mates are not available to cover the
loss OF revenue from one or two
changes in the CIO program, and
concluded that the full plan might
reduce individual taxes by more
than s6,5o0,00o,0O0
Exemption Credit Urged.
One of the innovations Mr.. Nc
Avoy suggested was that, individuals
be allowed TO carry back and for
ward unused exemption credit from
one year to another, a privilege
already allowed corporations. He
gave no estimate of the effect of
this change.
Estimates also were lacking on
the probable cost of another pro-
posal that tax concessions to vet
Grams during the war be extended
for one year.
When Mr.. McAvoy read a recon-
mendation that personal exemp-
tions be increased to $1,000 for a
single person and 50 900 for married
couples, along with the present $500
allowance for each child, Senator
Taft, Republican, of Ohio inquired
how many more taxpayers would be
dropped from the rolls by those
changes. No estimate was available.
Purchasing Power Stimulation.
The House bill already drops
100000 low-income individuals
from the tax rolls by allowing the
same personal exemptions against
the per cent normal tax that al
ready prevailed for surtaxes. Sena-
tor Taft suggested the higher ex-
emptions proposed today might free
another 100000 from any tax.
Mr.. McAvoy stressed the need for
framing a tax program that would
stimulate purchasing power for the
great mass of consumers.
Senator Millikan, Republican, of
Colorado asked the witness for his
theory of increasing the purchasing
power of the dollar.
"By holding down prices and in
creasing wages to Offset the decline
in take-home pay" Mr.. McAvoy re-
piled.
Lucas Questions Minimum Wage.
The witness also agreed with SEN
ator Millikan that cutting down
the unit cost of mass production
goods would increase the purchas-
ing power of the dollar.
Senator Lucas, Democrat, of Illi-
nois wanted to know how the prices
of necessities can Be held down if
minimum wages are raised to IS
cents an hour, as proposed in a
pending minimum wage bill.
Mr.. McAvoy said increased pro-
ductivity and skill of workers could
do it. This prompted Senator Bark
ley, Democrat, of Kentucky to in
quire what effect on total employ
ment would result from increased
productivity of the individual
worker.
Ringer Asks Business Relief.
Mr.. McAvoy said that "if we took
static view of production it would
mean reduction in employment,
but he contended that the volume
of production can be expanded if
there is enough purchasing power.
Another witness heard today was
Walter M. Ringer, who urged tax
relief for small business as well as
individuals. A member of the Small
Business Advisory Committee of the
of Commerce, and of
the National Association of Manu-
facturers, Mr.. Ringer suggested:
That small business be freed from
the excess profits tax in 1916, and
that the S25, 900 exemption from that
tax recently voted by Congress be
made retroactive to last January;
that corporation tax rates be grad
uated up to 100000 of net income,
with uniform rate above that level:
that individual tax rates be reduced
to provide venture capital and to en-
courage consumption.
Plan May Be Rewritten.
AS the committee entered the sec
ond day of hearings, there were
growing indications the SIS 300 600, 900
House-approved measure will be re-
written by the Senators to follow
more closely the administration
(See TAXES, Page AID