Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-07-30
Congress Completes
Action on Bill Cufiinu
Taxes SIS Billion
BY j. A. oIeory

The first complete revision of
the tax laws in Is years is on
its way to the White House to-
day. following Senate passage
last night Of the final House.
approved draft.
Designed to remove inequities,
it will give SIS billion of addi-
tional tax relief TO many individ-
uals and corporations.
It brings to SIS billion the
aggregate Of tax relief put into
effect this year, but it also will
increase the pressure on the Sem
ate Finance Committee to do
something about increasing the
Federal debt ceiling subject
the Senate has sidetracked for a
year.
Before Congress adjourned in
1858 the House passed the adj
ministration's request to add SIS
billion to the governments bor-
rowing authority by raising the
debt ceiling from $275 to $3.50
billion. There is strong OPPOSE
ton to this increase in the Fin
ance Committee, however, and
the administration may have to
come up with a modest conipro-
mise to get action on the debt
limit before this session ends.
2 Major Bills in Q Days.
The general tax bill, which
President Eisenhower has called
the cornerstone Of his 1854 legis-
lative program, was the second
major bill completed In two days.
On Wednesday both houses COM
pleted action on the housing bill.
This still leaves on the legis-
lative docket foreign aid, the
farm bill. social security and UNI
employment compensation ex-
pansion. two appropriation bills,
Government employe pay in
creases and the debt ceiling in
crease.
This remaining work-load is
piled up on the Senate's door,
step, and it may take the body
until August Is to complete it,
allowing time for the contro-
versy over whether Senator Nc
Carthy. Republican, of Wiscon-
sin. should be censured.
An innovation in the tax bill
is the relief it extends to indi-
viduals on dividend income. The
compromise finally agreed upon
exempts the first $50 of such
income from taxation, and allows
a 4 per cent tax credit against
the remainder of such income.
Bill Approved, 61-26.
When the bill first passed the
Senate it contained only the $50
exemption, and several Senators
made a last-minute futile at
tempt to block the 4 per cent
credit. The Senate approved the
compromise bill, 81 to 26.
Another important feature.
which the administration be-
lieves will stimulate Industrial
expansion. is q new method of
handling depreciation of new
plants and equipment. Corpora
tions may write Off a larger part
of the cost in the early years.
Only major action in the law
on tax rates is a one-year extern
sion of the 50 per cent tax on
corporate income. This rate had
been scheduled to drop to Al per
cent, and its extension will pro-
vide $1.2 billion for the Treas
ury.
Democrats Lose Fight.
Senators johnson, Democrat,
Of Colorado, and Douglas, Dem
ocrat. of Illinois, led the unsuc-
cessful fight yesterday against
the four per cent tax credit on
dividend income. Senator john
son cited the Treasury's antici-
pated request for a higher debt
ceiling in the next few weeks, and
said this proves Congress has
gone as far as it can in tax re-
lief.
In the approaching congress
sional campaign Republicans are
expected to brag about the SIS
billion total of tax reduction put
into effect this year. Democratic
orators will reply that the two
biggest cuts. which took effect
in January, were ordered by a
Democratic Congress in 1851
These were the 10 per cent cut in
personal income taxes, amount
ing to SO billion, and the repeal
Il