SALES TAX ISSUE

Hokitika Guardian, 9 December 1932, Page 5

SALES TAX ISSUE

AMERICAN BUDGET

A HUGE DEFICIT DISCLOSED.

jTfcr Frets Association — Copyright )

WASHINGTON, December 7

The turbulent sates tax t.ssue was tossed! squarely bacK into the tap of Congress,' by the '(Secretary to the Treasury (Mr Ogden MEHs;, with a recommendation that two and a quarter iper cent, general manufacturers’ levy be adopted, f, , in his annual report, the Secretary j said that th© present specific, taxes, adopted la;#t session by ..(Jon-, gress, failed to produce the expected revenue. He proposed tueir repeal and directly aisked the House to reverse itself.

Only six months ago that body bolted from its leadership to voce oown the one and three-quarter per cent, sales tax ;/ after study of tne Canadian sales tax method.. The issue was not even brought to a vote in the Senate. The new sales tax is estimated to yield 355 million dollars. The budget provided! 586;477,(XX) for national defence compared with 632,466,C00 last jear. Mr Hoover, to-day, presented to 'Congress, a drastically reduced budget, recommending two and a quarter per cent, manufacturers’ excise tax, retention of the gasolene tax, rigid economies, including an additional eleven per cent, cut in Government salaries, and a big slash in the veterans’ benefits. He asked for total apceiptis 2'949,162,713 dolors,' leaving saying the net expenditures would total 3,256,354,900 dollars against receipts 2,949,162fi,713 dollars, leaving a deficit of 307,192,187 dollars. It was to offset this that the new taxation was proposed. Drastic reduction of Governmental expenditures was,insisted upon by the Secretary to the Treasury,. Mr Mills, who predicted that for the present fiscal year at the end of next June, the deficit would be 1146 million dollars, and the following year, at the present pace with a deficit of 307 millions, exclusive of debt ..retirement. He said that the 'Government spending could be reduced by 479 million dollars in the 1934 fiscal year, if the' recommendations mad© by the President in the Budget message, were followed. He had to provide for a resumption of normal reduction in public debt in (1934, but urgjemt or otherwise the budget would be balanced. Mr Mills said that while it had been estimated last May, the income of the Government in the 1933 fiscal year would amount .to 3098 millions, revised estimates indicated they would total 2624 million “ dolini's. Custom® duties were now estimated at 290 million dollars, a drop of sixty million, from the May estimate, and income taxes at 860 million, a drop of 176 million. No mention of war debts was made in the Presidential message, but*the report of Secretary Mills sent simultaneously, disclosed that payments dim from foreign nations had been included in striking the Government’s balance. Neither did the President make ■any mention of , legislation on beer, the estimated internal revenue collections including no figure from this source. In his veterans’ economy proposal, the President defied the clamouring for payments of bonus and maintenance of present benefits, hv recommending to Congress, legislation which would strip 127 million dollars worth of pensions, compensation and allowances off the rolls.