Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-12-07
Prospects, Dim
For Reduction
In Excise Tax
BY ROBERT X. WALSH

tomobiles and other items next
spring virtually melted away to-
day because Of GOODNESS Of one
House subcommittee and out
right opposition by the chair
man Of another.
A ways and means subcom-
mittee on excise tax problems
wound up two weeks Of public
hearings late yesterday after
hearing an AFL-CIO official and
several other witnesses urge that
Congress permit scheduled cuts
to go into effect April /. Mem
bers Of the subcommittee headed
by Representative Forand, Dem
ocrat of Rhode Island, voiced
sympathy for the idea but gave
little hope.
Calls Tax Extension Necessary
Moreover, in a speech before
the Federal Tax Forum in New
York last night. Representative
Mills, Democrat Of Arkansas,
chairman Of the Ways and
Means subcommittee on tax pol
icy, declared the Nations pres
ent fiscal situation requires ex-
tension Of the excise rates which
under present law would de-
crease on April /. These levels
were to have dropped in 1854 but
have been continued annually
by Congress. The decreases
would cause revenue loss OF
about 5000 million.
Administration spokesman dis
closed recently to the Forand
subcommittee that President Ell
senhower will ask Congress to
retain the present rate for an
other year.
In testimony before the sub
committee yesterday. Stanley H.
Ruttenberg, AFL-CIO research
director, recommended that the
cuts be made. He urged also that
Congress reduce still further
excise taxes which affect low and
middle income individuals un-
fairly"
He especially criticized pro-
posals by some witnesses last
week for Z uniform excise tax
on most products at the manu-
featuring level. He attacked such
q general sales tax as unfair,
unjust and most burdensome to
lowest income recipients"
Liquor Tax Cuts Asked
Excise tax rates on liquor, beer
and wine also figured prominent
~ yesterday in pleas by industry
spokesman and others urging
major reductions In the rates or.
at least as q first step, the
smaller April /. 1857, automatic
cuts In rates on alcoholic bev-
erages.
Many Of the witnesses warned
that the present high rates are
a boon to bootleggers. a go-sign
for moonshine making, an en-
couragement Of rackets and cor
ruption. and a possible invitation
to the return Of national prohi-
bition.
While the heaviest attack CEN
tered on levies on distilled spir-
It's. there were claims that the
existing tax Of SO a barrel on
beer was a trend toward monop-
oily whereby a few big companies
were swallowing the market.
Hits Tax on Bubbles
When the testimony turned
to wine. Frank Shoemaker Of
New York, introducing himself
as a wine expert" declared:
Gentlemen, what you are
taxing when you tax champagne
is wine plus bubbles. When you
ask sparkling wine to pay 20
times as high a rate as a still
wine. 80 per cent of the tax is
on bubbles. Why should the
bubbles in soda water and Coca
Cola and the bubbles in bubble
gum go untaxed when your tax
on bubbles in wine is at the
rate Of over So a gallon?"
Before ending its two weeks
Of hearing Spokesman for scores
Of industries and organizations.
the subcommittee heard Repre-
sentative Broyhill, Republican
of Virginia. support a recon-
mendation by witnesses from
Montgomery County, Md. early
this week.
This urged repeal of the 20
per cent excise tax on community
swimming pools. Mr.. Broyhill
said the levy not only is unduly
burdensome and unfair. but also
has led to confusion because of
conflicting applications by the
Internal Revenue Service in some
instances.
Speaks for Recreation Groups
Another among more than 20
witnesses yesterday was Nicholas
G. Penniman III. Of Baltimore,
appearing in behalf of ~ volun-
tary national health. welfare,
youth service and recreation or
carnations. He explained that
most Of the groups themselves
are tax exempt and receive con-
tributions that can be claimed
for tax deductions by donors.
But. he said. the organizations
nevertheless have to pay heavy
excise taxes on numerous things
they buy. ranging from automo-
biles and refrigerators to tennis
rackets. bowling balls and musi-
cal instruments.
Chairman Forand announced
the subcommittee will meet with
Federal Communication Com
mission officials Monday and on
Tuesday with Treasury repre-
sentatives to obtain further spe-
cific information on some Of the
excise tax revision suggestions
made by public witnesses since