Evening star., 1960-06-09
SenatorsSee
Cut in Phone,
Travel Tax
By ROBERT X. WALSH
Star star Writer

0CIldJOIo 1dNOIluB bdA CuIo
on local telephone service and
passenger travel tickets pre-
dieted today that the Senate
again will vote such reductions
despite House passage of a bill
keeping present rates.
The 222 to 174 House vote
late yesterday sent to the Sen
ate a bill putting a $293 billion
temporary limit on the ma
tional debt until July /, 1861
and continuing until that date
the existing rate on corpora
ton income taxes. 1t also
would continue present rates
on Korean war" excises on
alcoholic beverages, cigarettes
and passenger automobiles as
well as on telephone service
and transportation of persons.
The measure, recommended
by the Eisenhower administra-
ton and approved by the
Ways and Means Committee.
aroused little opposition in
House debate yesterday except
for the freeze on local tele-
phone and transportation tax
rates.
Cut Okayed Last Year
Congress a year ago author
lied repeal of the 10 per cent
tax on local telephone service
and a reduction from 10 to s
per cent in the levy on rail,
air and bus transportation of
persons. Those cuts were to
take effect at the end of this
month.
The House bill, however.
would block those cuts and
thereby prevent a Treasury
revenue loss of about SAT- mil
lion during the fiscal year be-
ginning July /. An overall rev.
enue decrease of about $26
billion would be prevented by
extension of the So per cent
corporation income tax rate
which otherwise would go down
to AZ per cent on June 80 and
OF the Korean War" excise tax
rates which likewise would de-
crease automatically at the
end Of this month.
Kerr to Lead Move
Senator Kerr, Democrat of
Oklahoma, already has served
notice he will lead a move to
restore the telephone and
transportation tax provision.
Several other Senators as well
as House members said pri-
vately they believe the Senate
will do this.
1ney recalled that the tax
reduction provision was added
by the Senate to a similar
House bill last year and subse-
quently accepted by the House
to take effect July 1, 1860.
Representative Brown, Re-
publican of Ohio, warned that
the Senate may restore these
cuts and leave us in the House
looking a bit sheepish." Mr..
Brown was among many men,
berS who protested that the
tax extension and debt limit
bill came before the House
under a gag rule" giving no
opportunity for a separate vote
on the telephone and transpor-
tation tax provision.
A move to prevent House
consideration of the bill under
such a closed rule was defeated.
202 to 1871. This was regarded
as surprisingly close in view
of the usual House practice of
adopting most procedural rules
on voice votes.
Although requested by the
administration, the bill was
opposed by many Republicans
on the vote on the rule as we'll
as on final passage.
The voting however, was not
entirely on party or coalition
lines.
Urges Responsibility"
Representative Byrnes, Re-
publican of Wisconsin, Joined
Committee Chairman Mills.
Democratic of Arkansas in
urging passage of the bill to
maintain fiscal responsibility"
and prevent revenue decreases
that would wipe out all chance
OF a budget surplus. Mr.. Mills
also cautioned against piece
meal" tax cuts. He declared
that a tax on a particular in
dustry such as the telephone
company should not be reduced
Just because somebody has
presSured for taking it off"
In reply to Mr.. Browns
charge that Congress will be
accused of breaking a promise
to cut telephone and transpor-
tation taxes this year Mr.. Mills
recalled that the House and
Senate agreed last year to let
the tax reductions go in effect
this year only if they were
found to be justified by eco
nomic and budgetary condi-
tionS. He told the House the
Committee decided against
such reductions until there is
a demonstrated surplus in
Treasury revenues"