Evening star., 1947-01-15
Committee May Act
Friday on Extension
OF High Excise Tax
BY the Associoted Press

By the Assoeiotsd Press
Republican tax managers gave
a green light today to legislation
continuing indefinitely the high
wartime excise rates on such
items as liquor, furs and jew
elry.
The surprise decision to head of
an automatic $500 900, 900 rollback
in levies July l brought COP law
makers and President Truman eye
to-eye on the first major tax prob
lem to confront the Eightieth Con-
gress.
But Republicans expressed re-
newed determination to cut indi-
vidual income taxes 20 per cent
a move strongly opposed by the
President.
Chairman Knutson said the House
Ways and Means Committee may
approve a bill continuing the high
excises at its first meeting on Fri
day. Such quick step, he said,
would erase business uncertainty
caused by consumers delaying pur-
chases in anticipation of the other
wise automatic reductions six
months hence
Grant to Offer Bill.
The bill. to be offered by Repre-
sentative Grant. Republican, of
Indiana would remove the the in
centive to stop buying In anticipa-
ton of tax cuts" Mr.. Knutson said.
However, he told newsmen, the
continued large collection of excise
revenues would make it easy for
the Republicans to slash individual
income taxes by fifth this year,
at total estimated saving to in
come earners of $3.50, 0,00o, 600.
If Chairman Taber of the House
Appropriations Committee is correct
in declaring that the budget can
be held down." Mr.. Knutson said,
then:
, "A 20 per cent tax reduction will
be comparatively easy, and we
should be able to pay four or five
billions on the public debt.
Big Saving Held Possible.
. "If Mr.. Taber's figures are cor
rect, anybody who says we can't
cut individual income taxes 20 per
cent is talking through his hat" :.
Mr.. Taber's latest estimate Is that
"three to four billions" can be pared
from the Presidents $37, 7,o28,oOO,0oo
spending figure.
Unless Congress intervenes, the
high excuses, provided by the l945
Revenue Act, will revert to old rates
.Julv l under the Presidents proc
lamation declaring hostilties at an
end.
Mr.. Truman recommended IN MS
budget message last week that Con-
eress maintain the wartime levles,
but Republican sentiment then
seemed to be against him.
Position Reversed.
The reversal of position came at
the first meeting Of COP members
of the House Ways and Means
Committee yesterday.
Continuation of the excise rates
would prevent these decreases:
Liquor-from So proof gallon
to Sc. A reduction in the liquor rate
alone would mean an $500 ,00o 600
annual loss in revenue.
Furs, jewelry, luggage, cosmetics
and theater tickets-from ~ per
cent to 10. -.-.-- -----.-,
Night clubs-From 20 per cent
to S.
Telephone bills-Long distance
calls from 25 per cent to 20, local
seryice from Is per cent to 10. g g
Transportation of persons-From
IS per cent to 10.
Liquor and fur interests in New
York said indefinite continuation OF
the excise 1evies undoubtedly would
further retard sales, but they agreed
"it will be a relief to have it settled
even if against U.S."
Budget Group Meets Monday.
Mr.. Knutson announced the joint
House. Senate, 102-member Budget.
Committee will meet Monday for its
first look at President Trumans
1o48 fiscal estimate, preparatory to
writing it's own ceiling on Federal
expenditures as required by the
Congressional Reorganization Act.
Both Chairman Taber of the
Appropriations Committee and Rep
resentative Dirksen, Republican, OF
Illinois, an Appropriations Commit
tee member, took the House floor
yesterday to demand sharp shear
ing of the Presidents recommended
tions for expenditures.
Mr.. Taber told the legislative body
that you must tell the bureaucrats
you have got to clean house MIR.
Dirksen declared "the best approach
Congress can make is to bebuild
the budget from the bottom up,
rather than to start cheese pairing