Evening star., 1948-01-31
The Political Mill
Income Tax Reduction
Showdown Seen on Wuy
Expected Veto of Knutson Bill Sure
to Raise Issue in Election Campaign
By Gould Lincoln

to Raise Issue in Election Campaign
By Gould Lincoln
Another showdown between President Tru-
man and the Republican Congress on the mat
ter OF income tax reduction Is on its way
and the showdown. according to all accounts,
win not be long In coming. Ever since the
election Of 1916, when the Republicans won
control Of Congress, promising to bring about
reduction In taxes Mr.. Truman has found
it convenient not to permit Republican tax
reduction bill to become law. He vetoed two
of them during the first session Of the present
Congress. According to the Democratic leader-
ship. he plans to veto third bill.
If the President does veto the bill which
has now started on its way through the House,
and the veto is sustained his action is likely
to have vital effect on both the coming politi-
cal campaign and the November elections
and on the Presidents own proposals for
foreign aid and for domestic improvements
It will soon be three years since hostilities
ended In World War II-and the American
taxpayer is still paying wartime taxes-taxes
that are tremendous burden. They are be-
coming more and more burdensome too, as
the cost Of living rises. High prices and high
taxes are twins in the economic picture today.
They both exist while the country is under
the Truman administration-which makes 1t
bad for that administration, however you look
at 1t.
Practical Wage Increase.
material tax reduction-income tax re-
duction such as that proposed for the lower
brackets in the pending Knutson bill, and
which extends to the medium brackets as we'll
Is very practical wage increase for workers.
It is an increase which can be obtained without
the interruption of production In this country
by strikes or lockouts 1t can be obtained with
out prolonged strife between labor unions and
management. The Congress, which has the de-
sire and the will to put through the necessary
legislation is warned, however, that a single
man. the President Of the United States, is pre-
pared to say mo" If that mo- can be made to
stick, the people will have no tax relief during
the year 1948-just as they had no tax relief
during the year 1947.
Mr.. Truman must choose between the criti-
cism which will be heaped on him If he Is
able to prevent tax reduction and the advan-
tage which may accrue to the Republicans II
their bill becomes law. Which will lose him
the greater number of votes? This is prac-
tical political question. It Is question which
some of the Democratic members of the House
and Senate will also face If and when they are
asked to sustain presidential veto of the tax
reduction bill. They too, have stake in the
coming elections. 1t may be that some Of
these Democratic members may come to feel
that they will actually be aiding Mr.. Truman
by voting to override such veto, thereby
making it possible for the people to have tax
relief.
The fact that Mr.. Truman came forward
with a proposal for $40 cost-of-living tax
credit for every taxpayer, and another $40
nh of tov 10
going to help the Democratic President out
If all tax legislation fails. Forty dollars, di-
vided into 365 days. does not give much relief
to taxpayer. Between 10 and II cents as O
matter Of fact. This proposition did not even
make hit with Democratic members of the
Congress.
Attitude Held Political
At the same time that Mr.. Truman is de-
manding that high taxes continue to be i'm
posed, he is asking Ccngress-and the Amer
ican people-to consent to the expenditure Of
N$6 300, 900 900 during the next is months for
the Marshall European Recovery Program. II
would be far easier to obtain the consent Of
both the people and Congress for such expendi-
lures If the President were willing to conceds
something in the way of tax reduction AS 1t
Is, the prospect of ack-breakng taxation with
continued huge Government spending, both
abroad and at home Is more than discourage
ing.
Mr.. Truman's attitude Is more and more re-
garded as political-a desperate opposition to
any tax relief originating in q Republican
Congress-
The Knutson bill as presented to the House
proposes tax cuts amounting to $500, ,000, 900.
Presumably this will be reduced in amount
during its consideration in the Senate-perhaps
to "A, 500 o00000 II it is, there seems no doubt
that considerable number of House Demo-
Gratis will 60 along with the bill when the final
action comes.