Evening star., 1947-07-04
Both Houses Expect
To Pass New Tax Cut
Measure Next Week
Republican Leaders See
5 Billions Available for
Debt Payment This Yeor
By J. A. O'Leory

Republican leaders predicted
today that passage of their new
January l tax cut for $4,000, 900
individuals still would enable the
Treasury to pay off more than
$5,000,000,000 of the. national
debt in this fiscal year. a.. z: E
The bill, approved by the House
Ways and Means Committee late
yesterday, ,,l8 to 6, is expected to pass
both the House and Senate next
week. - y
1t provides the same rate cuts
President Truman vetoed before
ranging from 80 per cent In the low
brackets to 10.5 at the top, but the
effective date has been postponed
six months.
Although the previous veto was
sustained in the House by a two
vote margin, COP strategists be-
heve they will have two-thirds ito
override another veto in both
branches, unless Senate opponents
take advantage of the liberal de-
batting rules in that body to fill
buster in the closing days of the
session
Little Delay Expected.
The present plan is to adjourn
Congress July 26. A definite ad-
journment date always makes it
easier to kill a bill in the last
minute rush. On the other hand
if two-thirds favor the tax bill
they could easily postpone adjourn
ment 1t is doubtful, also, whether
many members would join in trying
to prevent vote on a tax-reduction
bill.
Congressional tax experts said to-
day that even on the basis of Presi-
dent Truman's $37,5O0, ,000, 900 ex-
penditure budget for the fiscal year
which began July /, the new tax
bill would leave $4,000, ,000,000 for
debt retirement. They figure that
when all the appropriation bills have
passed the economy drive will show
a saving of at least $4,000, 100000 in
the budget, making $5,400, ,000, 900
available for the debt.
COP spokesmen are counting on
this argument to meet one of the
chief objections the administration
raised against the first tax-cut bill
President Truman would still have
another peg left on which to hang
a second veto, namely, that the
unchanged rate structure provides
the wrong kind of tax reduction.
Two Amendments Defeated.
Democrats supporting the admin
istration made two vain attempts in
the Ways and Means Committee
yesterday to change the shape of the
bill. If they had succeeded the ad-
ministration could have embraced
the new bill, claiming the Republi-
cans had been forced to write more
reasonable tax plan.
Representative Forand, Democrat,
of Rhode Island, moved to raise the
personal exemption of each taxpayer
and dependent from $500 to s700, as
substitute for the percentage rate
cuts. This was beaten, Is to 7.
Representative Dingell, Democrat,
of Michigan, moved to repeal all of
the 1943 wartime increases in excise
taxes, including the tax on trans
portation of property, as substitute
for the income tax rate cuts. This
was defeated, 19 to S.
Representative Knutson, Republi-
can, of Minnesota, father of the tax
reduction bill, also took steps yes
terday to meet one source of opposi-
ton to the measure, by promising
action at the next session on the
community property problem in re.
lation to income taxes.
At present only nine States have
community property laws, permit.
ting married couples to divide theil
incomes for tax purposes, which re.
duces their combined tax load
Some members of Congress art
threatening to figh: the new tax bill
unless something is done to Civ
husbands and wives in the rest o
the country the same advantage
(See TAXES, Page A-5.)