Evening star. [volume] (Washington, D.C.) 1854-1972, 1958-03-04
Would Lower
Income Levy
Exemptions
By CHARLES L. HOFFMAN
Star star Writer

time, to lower personal ex.
emptions from $500 to $500.
The single theme tax pro-
gram was being promoted here
last night, as Senate-House
conferees prepared for their
second meeting late today.
Indications yesterday were
that at least half of the Senate
Finance Committee members
favored an income tax in,
crease as the means of raising
an estimated $33 million to
balance the State budget for
the coming fiscal year.
Dual Plan Favored
Reports, however, were that
a majority of the House Ways
and Means Committee favored
a dual program, with increases
shared between the sales and
income taxes.
One such proposal would
raise some $25 million by in.
creasing the income tax rate
from 2 per cent to 3 per cent,
and another $8.5 million by
lowering the sales tax starting
point from 81 cents to IA cents
and removing exemptions on
restaurant meals.
Increasing the income tax
rate from 2 per cent to 3 per
cent would raise an estimated
$25 million, and dropping the
exemptions to 5000 would raise
another 1882 million, tax ex-
pertS here reported. That would
be more than enough to balance
the budget.
The Senate-House confereeS
may be headed for a real dead
lock over the tax program,
committee sources reported.
Budget Fight Due
A battle, meanwhile, is ex7
pected in the House over the
Senate'S budget bill, which is
some STA million lower than
that recommended by Gov. Nc
Keldin.
Chief trouble spot is the big
slash the Senate Finance Com
mittee successfully pressed in
health and welfare spending.
The Ways and Means Com
mittee last night, for example,
almost voted to restore some
100000 of the $436,0O0 cut
from the medical care program.
The vote, on a motion of
Delegate Blair Lee III, Demo-
crat of Montgomery, stood at
IA to i3 and failed only when
Chairman A. Gordon Boone
cast tying ballot.
Noisy Protests
Mr.. Boone's vote-an almost
unprecedented option-brought
protests from committee menu
bers, who became so noisy the
meeting was adjourned until
today.
The general sentiment even
among those favoring restora-
ton was that the House would
stick with the Senate on the
budget bill which calls for $l77
in general fund spend
ing.
Senate Finance Chairman
John Grason Turnbull. in five
hours of debate yesterday,
guided his committees propos-
ais through the Senate, beating
down efforts to restore more
than ST million in health and
welfare funds. The reservations
had been urged by Gov. Nc
Keldin, who in a special mes.
sage to the senator's said the
Committee action "far
surpasseS anything we had inn
agined." y
The Governor, in presenting
his budget proposals. had rec
commended increasing both the
sales and income tax rates by
so per cent without tampering
with present exemptions.
The hope of avoiding a dual
raise came with the fiscal COM
mittee's successes in cutting
back the deficit.
Election Year
Legislators privately admit
here that holding the tax rate
increases to one tax source
would mean that next years
General Assembly will face q
ucIiClL problem anew,
But this is election year.
The Senate adopted the bud
get by a 27-to-2 vote with the
negative ballots being cast by
Senator's Joseph A. Mattingly
and Louis N. Phipps, Democrats
OF st. Marys and Anne Arundel
Counties, respectively. Neither
suggested any alternative bud
get proposals.
The Senate bill included a
provision worked out over the
week end by Senator H. Win
ship Wheatley, Democrat Of
Prince Georges, to increase the
coverage of salary adjustments
for State employees from 10000
to $4,000 employees. The adj