Evening star., 1950-07-20
Cry Rises al Capitol
For Excess Profits
Tax on Corporations
BY the Associated Press

- Demands arose on Capitol Hill
today for multi-billion- dollar
excess profits tax on corporations,
to prevent prof1teering.
A general tax boosting bill
possibly putting larger levies on
individual incomes, along with
higher taxes on corporation profits
will replace the 81 billion excise
tax SlaShing measure that Con-
gress has put aside.
President Truman gave notice
yesterday he will ask for more
taxes-he didn't say just when
to help finance the extra SO bill
lion needed for the battle against
Communist aggression, to curb
imitation and to eliminate prof.
iteering.
His use of the word "profiteer-
ing" was interpreted in Congress
as meaning he is certain to ask
for an excess profits tax. # the
wartime 85.5 per cent rate and
base for calculating such profits
were restored, they would yield
the Government about So billion,
one expert said.
Softer Levy Rejected in ~.
The President proposed softer
excess profits tax early last year,
as an anti-inf1ation measure, but
Congress turned it down.
An excess profits tax drains off
for the Government corporation
profits that exceed those of a
specified normal profit period, or
are above those deemed reasonable
on the basis of invested capital.
The mood of Congress now ap-
pears to be that it will follow the
President far. if not all the way,
in providing more revenue. How
ever, action on a tax bill is not
likely before November-after the
elections-and possibly not until
January.
Nobody can tell now just what
form the tax-booSting bill will
take, especially whether individual
income rates will be boosted.
O'Mah0ney Asks Quick Action.
Chairman O'Mahoney of the
Senate-H House Economic Commit
tee issued a statement calling for
immediate action to impose "at
least an excess profits tax" He
said. too. that "the Nation is once
again face to face with the prob
lem of freezing prices"
IF We temporize, imitation will
make the job increasingly diff
cult" he said. There is no mem
ber of Congress who does not re-
member how impossible it is toI
roll back prices after they have
riSen." 4
Senator Russell, Democrat. of
Georgia said, ''The Nation must
face up to the fact that we've
got to have an increase in taxes"
Senator Aiken. Republican, of
Vermont said he couldn't under
stand why the President, in his
message to Congress yesterday,
didn't ask for excess profits taxes
now. He added: Obviously, he
will ask them at later date u
Robertson Sees Need.
Senator Robertson, Democrat
Of Virginia told newsmen: "The !
time has come to at least partially
offset defense spending with in
creased defense taxation. Uncon-
trolled imitation will hurt the aver
age consumer far more than any
emergency tax bill we may pass"
Mr.. Truman told ConsSess that,
as soon as necessary studies are |
completed, he will send up a |
message calling for stiff tax in
creases. He said:
"We must make every effort |
to finance the greatest possible |
amount of needed expenditures by
taxation. The increase of taxes
is our basic weapon in offsetting
the inf1ationary pressures exerted
by enlarged Government expendi-
lures. Heavier taxes will make
general controls less necessary.
eve must provide for a bal
anced system of taxation which
makes fair distribution of the
tax burden among the different
groups of individuals and business
concerns in the Nation. A bal
anced tax program should also
have as major aim the elimina-
ton of profiteering."