Evening star., 1948-01-19
Horrimon Urges
Revenue Level
Be Kept Steady
BY the Assoeio,sd Press

Bernard M. Baruch today pro-
posed restoration of an excess
profits tax on corporations-but
he refused to go along with
President Truman and congress
sional leaders who have asked
income tax cuts.
Mr.. Baruch opposed any tax re-
duction for two years.
Mr.. Truman wants a $40 income
tax cut on taxpayers and each de-
pendent but only if Congress taxes
corporation profits to make up the
revenue loss.
Secretary of Commerce Harri-
man supported the Presidents posi-
ton by warning, Our economy Is in
an inflationary situation and sound
policy demands that the level of
taxation be maintained"
Senators Hear Baruch.
Mr.. Baruch, longtime adviser to
Government leaders, appeared be-
fore the Senate Foreign Relations
Committee. He urged that the ex-
cess profits tax be restored at so
per cent of wartime levels, basis
different from that Mr.. Truman
proposed. He offered 1t as one point
in a program for building peace.
The Truman plan calls for IS
per cent tax on corporation profits
above the average 1885 1889 earnings
of individual corporations, plus IS
per cent, plus $4,000.
Mr.. Hartman testified before the
House Ways and Means Committee
which is considering income tax re-
duction proposals.
Commenting on suggestion by
Mr.. -Baruch that half of the war
time excess profits tax be restored,
Senator Barkley said he was one OF
those in Congress who had been
persuaded to vote for repeal OF
that tax two years ago, because
a lot of people came down here and
predicted we would have millions
of unemployed" and that business
would need an incentive to prevent
that during reconversion.
Lets be careful we don't get
such had advice again." MIR. Baruch
interposed.
Might Reverse Stand Now.
Senator Barkley said the dire
predictions at the close of the war
about unemployment did not
materialize, and that If he had it
to do over again he might vote
against repeal Of the excess profits
tax. Declaring that corporations
are making unprecedented profits at
present, Senator Barley said the
question now Is whether they need
any more incentive to expand
production.
Mr.. Baruch said his position is
that while we are rich and taking
in a lot OF money, we ought to
reduce the debt"
Senator Smith, Republican, of
New Jersey, wanted to know if the
plea of the witness against tax
reduction now means he would not
even favor any readjustment of the
tax load. The Senator said he
had in mind small businesses.
Mr.. Baruch said he tried to take
care of that by suggesting that
restoration of the excess profits
tax be accompanied by the war
time amortization concessions for
new plants.
Farm Bureau Would Keep Taxes.
Opposition to "any material re-
duction in income tax rates" was
expressed to the Ways and Means
group by the American Farm
Bureau Federation. President Allan
B. Kline said in a statement that
"a period of imitation" is not the
time for such a move. The fedora
ton did urge, however, that the
community property principle in in
come taxation be extnded to all
citizens.
Secretary Hartman did not
specifically refer to the Presidents
excess profits tax suggestion in his
opening statement to the committee,
but he anticipated objections that
such q tax would hamper invest
ments in business expansion. He
commented:
Since business needs for invest
ment are being reasonably met with
no evidence of lack of means of
financing by business, I do not
believe it is meaningful to say that
there Is shortage of savings to
satisfy business needs"
Hartman Lists Perils.
Mr. Hartman told the Republican
dominated Ways and Means Com
mittee that total private invest
ment in this country now consti-
tutes 13 per cent of the gross ma
(See TAXES, Page A-5D