Evening star., 1947-01-29
COP. Rebellion
Against TaxCut
Into Open
Across Board Slash
In Income Levy Is '48
Peril, EngeI Warns
BULLETIN

BULLETIN
House advocates of contin-
ued wartime excise tax rates
on liquor, furs and other Items
scored an initial victory today
when they overwhelmingly
beat down move to open the
legislation to amendments. A
humping voice vote to leave
the bill unchanged presaged
it's passage later in the day.
By the Associated Press
Representative Engel of Mich
igan told his fellow Republicans
today that enactment Of the
GOP-backed bill to cut income
taxes 20 per cent might spell
defeat" for the party in 1948.
The long-brewing rebellion in Re-
publican ranks against across the
board" tax cutting broke into the
open as the House neared vote on
legislation freezing excise taxes on
liquor, furs and many other items at
high wartime rates.
Signalling for the floor during de-
bate on that measure, MIR. EngeI
aimed his fire instead at House Bill
No. / by Chairman Knutson Of the
Ways and Means Committee to trim
income taxes a fiat 20 per cent for
all persons earning up to 100000 .
year.
Radical Departure.
Mr.. Knutson's bill would give only
meager tax relief to the poor, the
Michigan Republican declared, while
granting large benefits for high in
come persons.
Calling this a radical departure"
from past Republican tax policy, Mr..
Engel continued:
II like to think of the Republican
Party as the party of Abraham Lin
coin. Lincoln once said, God must
have loved the poor because he made
so many of them I am afraid the
present leadership of the Republican
Party does not agree with Abraham
Lincoln in this view"
Mr.. Engel, who has bill pending
to double the present $500 personal
Exemptions and thereby provide the
greatest tax relief for low income
groups, handed reporters copies Of
his speech before the House actually
began consideration of the excise tax
I. freeze.
without the freeze the exeises
would drop automatically July and
wipe out 100000, 900 a year in
Federal revenues.
Seek to Slash Budget.
But by keeping the so-called luxury
rates at their present levels indef-
initely, many Republicans have
said the going will be easier for
their campaign to push down income
taxes.
Moreover, COP leaders are driving
hard to slash down President Tru-
mans $37, SOC, ,000, 900 budget for next
year to make still more room for
tax cutting.
Chairman Taber of the Senate
House Budget Committee said after
the first closed door meeting OF the
groups 20-man subcommittee he
believes Mr.. Truman's figure can be
slashed by from $4,50o, 100000 to
S., SOC, ,000, 900.
Another Republican member who
attended yesterdays session, told
reporter privately, however, that the
conference got nowhere because
every member had different idea
and pushed for it,
The budget group, charged with
reviewing the Presidents figures and
putting its own ceiling on Federal
spending. will meet again Friday.
Wants Debt Reduced.
President Truman has urged ex-
tension of the high excise rates.
and is in agreement with Republi-
cans on this score.
But in his message to Congress he
emphasized that he wants the extra
money to apply to the national
debt and not for tax cutting.
Mr.. Engel conceded that he may
find it hard to block Mr.. Knutson's
bill for 20 per cent income tax cut.
He said the Knutson measure ap-
pears to represent "the tax policy Of
the Republican Party which now
has control of both houses Of Con-
gress" and added:
IT seem to receive no appreciable
support from other Republican men,
bers of the Ways and Means Com
mittee nor from the Republican
leadership for my bill"
Neither has been considered for
mally by the Ways and Means Com
mittee, step which must precede
any House vote.
Conflicting Theory Offered.
There are many people in both
the Republican and Democratic Par
ties" Mr.. Engel continued. "In fact,
believe they constitute majority
of those parties who believe that II
you will only give tax relief to the
man on top, the benefits will trickle
or percolate down to the little fell
low below.
But my theory is that in order
to have permanent prosperity, one
has to begin by increasing the pur-
chasing power of that great mass Of
people in the low-income groups"
Mr.. Engel contended that under
Mr.. Knutson's bill worker making
$12 week would receive tax re-
duction of only cents week or
81 .O4 year, while the financier who
had a 100000 annual income would
receive $12,790 year reduction
in taxes"
Southern California Hit
By Blizzard and Winds
| By the Assoeiofed Press