Not Yet

The Tax Reduction bill, having passed out of the hands of the House with 37 1/2% surtaxes (TiME, March 10), dallied in the Senate Finance Committee before appearing on the floor of the Upper House. What its fate will be there is uncertain. Some say the surtax rates will be lowered nearer the Mellon (25%) rates; some that they will be raised nearer the Garner (44%) rates. The latter opinion seems to be gaining. During the interval of expectation, there was last week a little comedy enacted over that section of the bill which promises a 25% flat reduction for all income tax payments made this year for 1923.

The Treasury Department suggested to the Senate Finance Committee that the 25% cut for 1923 taxes might be taken out of the bill and passed hurriedly in a separate resolution, before March 15, the date on which the first payments for this year were to be due. The reason for the Treasury's request was that returns had not been coming in as rapidly as usual, that it seemed that taxpayers were confused and were waiting to see what would happen before paying.

At once Congress began to calculate where it stood on the proposition. On the first day, it was generally opined that a separate resolution with the reduction for 1923 would be passed, although some of the Democrats would be opposed because they feared that President Coolidge would feel freer, politically, to veto the main tax bill if it did not include the immediate reduction. The next day, it was dubious whether the immediate reduction could be rushed through, because the Democrats were in arms against it. On the third day, several Republican leaders, notably Representative Green, Chairman of the Ways and Means Committee, and Representative Longworth, Republican Floor Leader, announced that they were against the attempt for rushing through the special resolution--because it could not be done--so in three days the attempt had practically blown over.

The reason was simply that all those who, for one reason or another, like the bill as passed by the House--either because it had higher surtaxes than the Mellon plan, or for some other reason, felt that 'the bill had a better chance of becoming law if the reduction for this year were blanketed in the same bed with their other pets.