Evening star., 1950-11-18
Business Attacks
Profits Tax Ian
AsInf|ationary
Burden Put on Small
Firms, Retail Leader i.
Says at Hearing
By Cecil HoIIond

Representatives of retail and
service businesses today vigorous
ly opposed a $4-billion-a-year
excess profits tax suggested by
the Truman administration.
In testimony before the House
Ways and Means Committee they
described the proposed act as lin
flationary," unfair and discrim-
tnatory against many businesses.
The committee held an unusual
Saturday session as it pushed
toward its goal of concluding pub
lie hearings on an excess profits
bill not later than next Wednes-
day, and having a measure ready
for House consideration by De-
cember l.
Ralph w. Button. spokesman
for the National Retail Drygoods
Association, said public pressure
for an excess profits tax to help
finance the country's rearma-
ment program stems from mis-
understanding of the application
OF such a tax"
Plan Called Inflationary.
ut is believed by many that
such tax siphons off excess
profits from the national defense
program and that it is tax
on big business" Mr.. Button testi-
fed. World War II experience
proved this premise to be false.
Statistics show that in 1914, three
flfths of the corporations paying
excess profits tax were in the
small category"
Mr.. Button said such tax "en-
courages waste and extravaganza"
and is definitely inflationary. De-
claring that an equitable excess
profits tax cannot be written, the
witness undertook to offer some
other proposal for raising the rev.
enue from industry and business
for the defense effort.
But Representative Cooper,
Democrat, of Tennessee blocked
the presentation by pointing out
that the committee was limiting
testimony to matters bearing on
future excess profits tax. Mr..
Buttons prepared statement
showed that he favored increases
in the normal and surtax on cor
porations. .:
John F. Lebor. representing the
Retail Industry Committee. al
group of 81 national retail trade
associations, told the committee
it is impossible to write an excess
profits tax bill that does not "cre-
ate more problems than it solves"
Suggestions Offered.
He offered number of Sugges-
tions to moderate the impact of
such a tax if one is proposed.
Arthur J. Packard, represent
ing the American Hotel Associa-
ton, also testified in opposition to
the proposed tax and suggested
number of provisions bearing par
ticularly on the hotel business.
In all, Is witnesses were sched-
uled for testimony at today's seS-
sion.
Out of three days of hearings
already held a general pattern of
a bill the committee likely will
report seemed to be emerging.
It was indicated:
/. A ceiling figure based on all
taxes d corporation has to pay
may be written into the bill. A
member of the tax-writing group,
who asked not to be identified by
name, predicted this would be
done and said he expected the
figure would be so or IS per cent
of a corporations overall profits.
Hardship" Case Provisions.
2. More detailed provisions for
handling hardship" cases and
speeding the handling of applica-
tions for relief will be written into
the bill than those contained in
World War II excess-prof1ts tax
bills.
8. A special board or panel like
ly will be authorized for the
handling of relief cases arising
from the administration of the
bill.
4. Efforts will be made to write
into the law provisions setting up
procedures for handling the cases
(See TAXES, Page A-2.)