The Key West citizen. [volume] (Key West, Fla.) 1879-current, 1954-07-30
LEGISLATORS COMPLETE WORK
on US. TAX LAW OVERHAUL
by JOE HALL

WASHINGTON B - Congress
completed action last night on the
first complete overhaul Of the ma
TONS tax laws in IS years, and
both Republicans and Democrats
claimed they would profit more
politically.
Whatever the political effects
may be in the coming campaign
for control of Congress, the action
sent to the White House for viz
tually certain approval the bill
President Eisenhower had desig-
mated as the cornerstone OF his
1854 program.
Before a 61-26 vote in the Senate
sent the bill to the President, DEM
ocrats seized q final chance to
snipe at some provisions.
Only three Republicans-Dwor-
shak (Idaho), LANCER (ND) and
williams (Del)-joined e Demo-
craas and Sen. Morse (Ind-Ore)
in voting ''no." Supporters includ-
ed AZ Republicans and Is Demo-
Gratis.
The revision bill carries 81, $685.
900 900 in assorted tax cuts for In
diyiduals and corporations in its
first year Of operation, more In
later years. It does not change
major tax rates except to main
tain the 81 per cent levy on cor
poration income which dropped to
a. per cent April / and is extended
retroactiyely.
Republicans hailed the bill as
Gaping q 7h-billion-dollar 1854
tax reduction program-biggest for
any single year. This already has
been used in COP campaign ma
terial.
Democrats interject here that
two big boons to the taxpayer took
effect automatically under a 1851
law enacted when their party con-
troIIed Congress.
These include two big reductions
which took effect Jan. three
billion dollars through q 10 per
cent personal income tax cut and
two billions through. expiration Of
the corporation excess profits tax.
On April / various excise tax
cuts totalling q billion dollars took
effect. These were fought by the
Treasury but enthusiastically sup
ported by Republican COMPRESSION
III leaders.
Republicans also contend the big
revision bill viii be politically help
ful to them because 1t contains
benefits for such groups as retired
persons, families with heavy medi-
cal expenses, mothers who must
work to support their children,
fathers with children in college
who earn part Of their way, and
farmers with big soil conservation
expenditures.
COP leaders from the President
down argue the bill will spur bust
ness by providing more funds tor
plant expansion and modernization
through a wide variety Of more
liberal deductions for businesses.
This win mean more Jobs, they
say. so
democrats, claiming they VIII
benefit. say the bill concentrates
benefits for big corporations and
the wealthy, but does little or MOTH
inq for the average little man.
They tried in House and Senate
TO put in a general tax cut, but
were beaten back on close votes.
The minority centers its fire on
4 provision in the bill giving relief
to stockholders on their dividend
income. This provision was sharp
w watered down from the form
n which the President first recon-
mended II. But Democratic ora
TORS contended that once the princi-
ME went into the law it could never
be uprooted and probably would
be extended. ,
Under it, the first $50 of dividend
income is excluded entirely in tig-
urine income tax. The major re-
Iief. though, comes from provi-
sion permitting stakeholder to
deduct from his tax 4 per cent OF
HE dividend income above $50.
supporters Of this argued It
would in part end double taxa
tom Of corporation profits, and
also would provide more equity
capital for business expansion.
democrats contended 80 per cent
Of the relief, estimated at 800 mil
lions a year when the plan reaches
fuIl effect, would 60 to one-sixth OF
/ per cent Of the population.
Most Of the benefits in the bill
are effective as of last Jan. l and
thus can be figured in on returns
filed next year. The bill. incidental
". losses out the traditional March
is filing date in effect since the
income tax law was passed in 1913,
and substitutes April Is.
The biggest revenue loss in the
bill results from new rapid de-
probation write-off system allowed
corporations and individuals. This
win cost s2s millions in the first
year, much more in succeeding