Evening star., 1947-04-20
Truman Estimates U.S.Surplus
At $1,25O>OOO,OOOl But Warns
Tax Cut Would Be |nfIationary
Lucas Offers Bill
For Equitable
Slash in Levies
(Tert q Presidents Statement on
Page AS.
By J. A. O'Leory

President Truman last nlgnt
predicted the Government will
end the fiscal year June 80 with
a surplus of $1,250,000,000 but
warned again that tax reduction
now would promote imitation"
Recalling that his January budget
message forecast a $4,000, ,000, 900
deficit, Mr.. Truman said the i'm
provement has resulted from hold
ing expenditures down while
Treasury receipts were being in
creased by high levels OF economic
activity" ...
He observed with regret, how
ever, that the increase in prices
since removal of controls has in
fiated the entire economic struc-
ture and currently is resulting in
very sharply increased corporate
profits"
Debt Reduction Emphasized.
The President stressed the need
for reducing the public debt to
the fullest possible extent now
WIllle tiIIIcS d1S ROOQ.
Republican leaders in Congress
however, gave every indication last
night they are going forward with
tax reduction plans now. They also
lost no time in disputing Mr. Tru-
mans statement that Government
economies helped change the out
look from a deficit to a surplus for
this fiscal year.
AS the Senate Finance Commit
tee prepared to start public hear
tngs at 1890 am. Tuesday on the
$4,000, 100000 tax-cutting measure
Republican leaders put through the
House, Senator Lucas, Democrat,
of Illinois made public substitute
plan he said would distribute the
same AMOUNT of tax relief more
equitably.
The Lucas bill, however, would
put off all tax reduction until jan
uary /, 1948, and to that extent
fitted in with the administration S
policy of putting debt retirement
first. Senator Lucas made it clear
the bill represents only his individ-
ual views, but he is a member of
the Finance Committee.
Sees Imitation in Tax Gut.
The President said a good start
has been made by bringing the pub
lie debt down from its all-time peak
of almost $280,000, ,0O0, 900 to the
present level of $3.50, ,000, 900 900, but
added "the most important thing
we can do in debt management to-
day is to continue to reduce the
debt as rapidly as possible" Then,
turning to taxes, he closed his state
ment with these words:
ut Is natural for taxpayers to
wish to see taxes reduced. But to
do this now would promote imitation
so that the benefits of any reduction
would be largely dissipated."
After learning of the President S
statement, Chairman Millikin of the
Senate Finance Committee said he
thinks Congress can provide for both
debt retirement and tax reduction
"and we're going to do both
Representative Knutson, Repub-
lican, of Minnesota. told reporters
the surplus is entirely due to in
creased revenues, which is not un-
expected because We are still on a
wartime tax basis two years after
VI Day" 1t was Mr.. Knutson
who, as chairman of the House
Ways and Means Committee, put the
tax bill through the House.
Taber Gives House Group Credit.
Chairman Taber of the Appropria-
tions Committee said it is because
his committee screened all appro-
priations very carefully" that "sav-
ings have been effected, which are
going to balance the budget"
I'VE have had to fight with every
department in the Government to
get the truth out of them with ref
erence to the budget" Mr.. Taber
added
Senator Butler, Republican, of Ne
braska, also on the Finance Com
mittee. Joined in predicting the Sen
See TAyEC pora AZ