Evening star., 1947-05-29
By J. A. o,leory

House and Senate conferees
reached complete agreement to-
day on a $4,000, ,000, ,00O-a-year
income tax reduction bill. with
individual cuts ranging from 80
per cent to los per cent to take
effect July /.
Inc agreement follows the Senats
version with this one exception:
The Is per cent cut would apniy
to the income brackets between
s136, 700 and $3o2, 1895.
Ihls was a compromise between
the House plan, which applied a 40
per cent cut to all surtax net incomes
from s1,400 up to $302, 900, and the
senate plan which stopped the 20
per cent cut at S79, TOO and applied
IS per cent from that point to
s3o2, 900.
1947 Reduction Halved.
For the full year of 194s, the bill
would give 80 per cent cut In tha
low brackets, and a 1o.5 per cent
above s302,000
BY agreeing on July | as the
starting date, however, the reduc-
tion for the last half of this calen.
dar year will be half of these rates
In each bracket, in other words.
Is per cent for the low incoms
groups and 5.25 per cent at the ton,
The original House bill made the
cuts retroactive to last January.
which would have granted the full
percentage reduction in each bracket
this year.
The compromise reached today on
the middle brackets adds $62 300. 900
to the Senate cost figures, which
become approximately $685.. .00o, 900
for the next fiscal year, or S4,o62,-
100000 when the bill is in full effect.
The difference is due to a normal
lag in collections not on with
holding basis.
Chairman Knutson of the House
Ways and Means Committee will
seek House approval of the confer
ence report Monday after which
Chairman Millikin of the Senate
Finance Committee, will urge Sen
ate approval.
Speculation on Veto.
This should put the bill on Presi-
dent Trunan's desk by the middls
of next week.
The main topic Of speculation in
and out of Congress today was
whether Mr.. Truman will sign or
veto the measure.
Mr.. Truman has said repeatedly
ne does not consider this the proper
time to cut taxes.
No Hope, to Override Veto.
Even the most enthusiastic Re-
publican advocates of an immediate
tax reduction admitted that yester-
days 1924 Senate vote offered no
hope that a veto could be- overridden
in the Senate. A two-thirds' ma
jority is necessary to override.
AS approved by the conferees, the
bill provides for the following cuts
in present taxes. over a full year:
80 per cent off for persons whose
incomes after exemptions and de-
ductions are 81 900 a year or less.
20 to 80 per cent on net incomes
between $1,000 and approximately
81 400.
20 per cent between $1,400 and
$136, 700.
Is per cent from s136, TOO to $3o2,-
400.
105 per cent on all above 1902 400.
The bill passed the Senate In
exactly the form in which 1t had
cleared the Finance Committee.
BY margins ranging from 10 to
80 votes, the Senate rejected a series
OF amendments, including the fol-
lowing:
To raise personal exemptions from
$500 to $3.50 for single persons and
from $1,000 to $500 for married
couples.
Substitute Bill Rejected.
To allow married couples In all
the States to split their income for
tax purposes, thus getting advantage
of lower rates.s This privilege now
is granted only in 10 States with
community property laws.
To recognize family partnerships
for tax purposes.
And complete substitute bill by
Senator Lucas, Democrat, of Illinois,
which would have increased personal
exemptions 800, allowed the COM
munity property split everywhere,
lowered each surtax rate by 2 per-
fSee TAXES, Page A-40