Evening star., 1953-05-19
Tax on Profits
For 6 Months
More Sought
Eisenhower Also
Plans to Urge No
Income Rate Cut
By Joseph A. Fox

FreSlQenC EISENHOWER plans to
ask Congress for a siX-month
extension of the excess profits
tax, which is due to expire June
30. He will also recommend that
individual income taxes be con-
tinued at the present level for
the rest of this year.
This was reported today by
congressional leaders who con-
ferred with the President in ad-
vance of his radio speech at
l0:30 tonight in which he will
discuss taxes and security.
The announcement immediate
ly brought opposition from Chair
man Reed of the House Ways
and Means Committee. He told
reporters mot a thing" happened
at the White House session to
change his determipation that
the excess profits tax must die
June 80. or his belief that indi-
vidual income taxes ought to be
cut sooner than January /.
Key Figure in Fight.
Mr. Reed is a key figure in the
matter, since his committee nor
mally must start all tax bills
through Congress. and it would
require new legislation to con-
tinue the excess profits tax. The
committee has already gone on
record, $50, against extending
the tax.
The congressional leaders said
that the President, in asking for
an extension of the excess prof
its tax, would move its expiration
date up to that of the II per
cent income tax imposed to
finance the Korean war. He will
recommend that the income tax
cut take effect as scheduled at
the end of the year.
Nets So Billion a Year.
The excess profits tax affects
about $4,000 corporations and
nets the Government about So
billion annually through a super
levy of 80 per cent on earnings
classed as excessive"
This Is above the So per cent
levy on profits making up the
corporate normal and surtax
rates. The extra income tax as
sessment has been netting about
So billion annually.
Gen. Eisenhower will outline
these figures and discuss the
prospects for a balanced budget
in tonight's radio talk, which
will be the first of the fire
side" variety he has made. 1t
is expected that his message to
Congress outlining his tax plan
will not be delayed long.
Congressional leaders said most
of todays hour and a half con-
ference with the President was
taken up in a discussion Of the
defense program.
Chairmen Saltonstall and Short
of the Senate and House Armed
Service Committees, who briefed
reporters afterward, said effective
airpower of this Nation has been
almost doubled since January 20.
73 Air Wings Now.
In an outline that Senator
SaltonStall said was designed to
answer critics of the administra-
tion'S arms plan, the two chair
men said there are now 73 COM
pletely equipped air wings COM
pared with At on January 20.
Twenty-three others will be
equipped in a few months. the
Senator said, and he added the
called for ia by July
l, 1854 and 100 by July /, 1855.
Senator Saltonstall said the
criticism was stirred because of
the administrations plan to cut
back from the 143 air wings con-
templated in the Truman budget.
He said the 120-Wing goal actu-
ally will provide more security
and efficiency" with less money.
Senator Saltonstall said also
that in the next fiscal year, ap-
preparations and carry-over funds
totaling 1886 billion will be avail
able for the armed forces and
that So per cent is going to air.
power, including naval aviation.
Both Senator SaltonStall and
Mr.. Short emphasized that the
administration is proposing to
provide a balanced military force
and, as Mr.. Short said, one that
will provide security without
bankruptcy"
Mr.. Short said the new mill
tary budget this year will pro-
vide for about $43 billion less
than contemplated in the Tru-
man budget, but the carry-over
funds will more than double the
figure.