Evening star., 1946-12-22

| ~ AU.pyHUi
| Promises by leading House Re
publicans of a 20 per cent slice Oh
personal income taxes for the next
calendar year are beginning to meet
opposition in Congress and the ex-
ecutive departments as the political
and fiscal experts calculate the pop
ular and budgetary effects of such
| a reduction.
A horizontal cut would have the
advantage of simplicity but would
| ignore the political realities and the
inequalities of the present tax
4structllre. Even some Of the Nery
fri id be the larges 81
! sfficiarieSk questioning the WaA ~
4of the rfslnises. ~
From the fiscal angle, 20~pel
cent cut in individual income taxes
jsaouId f - IreasuM about b
/ no, ,0O1 ~ at ti1e very fe the 6de
\ knme is trying to Valance n
budget and reduce the huge national
debt. The balancing of receipts and
expenditures isv in sight for the
current fiscal year, provided strike:
do not upset national and interna-
ltional economic stability.
Middle Bracket Hit.
Some expenditures will be reduced
and some will be eliminated. How
and where these savings will be
made are controversial questions
for governmental experts and politi-
clans. Whether there can be a cut
of s3,700, ,00O, 900 for the benefit oi
taxpayers is debatable. Whatever
saving is made, Democrats and Re
publicans will fight over the credit
From the political angle. riva
| parties are trying to figure ou'
whether fiat or selectiye reduc'
ton would attract the more voter:
in 1948.
Under the House Republican
promise of fiat 20 per cent SLASH
/ for all taxpayers, a man with ST.
100000 income a year would pay
fewer dollars in taxes than in 1899
1 whereas man in the S., 900 bracket
would pay 10 times as much as III
paid in that year before the war.
I The latest income statistics show
that there were only SO persons
with incomes of 100000 and ovel
in 1s42 as against 779, ,448 with in
comes between 5000 and $1,000
the same year. While no figures
are available for this year, the pro-
portion probably is about the same
! In 1929 there we're 513 persons witt
annual incomes of 100000 ar1t
over; these dropped to $50 in 1880
Since then the number has beer
under 100.
| For the current year, the 81 900,
900 man is paying ss38,85o in Fed
eral taxes and under 20 per cen
reduction he would pay $67l ,080. Il
other words, he will have $161, Is
after taxes this year; next year n
would have $328,920. In 1889, h
paid 1868, ,724 and had left $7,35
more than he would have next yea,
under the Republican plan.
/ The $1,000 man with wife an
two dependents-the family flgure'
in the million dollar example
paying 1898 this year; under 2
per cent reduction, he would pa
SAT- in 1947, saving of $118. AS thi
group usually gets its income in sal
larry cheeks, the monthly benef
would be $9.75. In 1889, the $5.ooO-a
s year man paid only s48 for the veal
Lowest Glass Relieved.
], The lowest income -payin
class was relieved Of income take
flor this year by congressional actiol
increasing personal exemptions an
j credits for dependents. At present
/ taxpayer gets $500 personal exemp
ton for himself, $500 for his Wit
and $500 for each dependent relative
Thus married man with $1,000 in
/ come, who has a wife and two chill
ldren, pays no Federal income tas
i These changes in the tax law too
l12 900 900 wartime taxpayers of tn
i rolls. A bachelor with no exemption
) or credits with $2,000-a-year in
come will pay $285 taxes this year.
q The increased exemptions an
!, credits for the current year in
-tcreased the savings to the lowe
) middle income bracket. For the So,
snn e-vaor foy,oiIv this ann0RY1ted I