Two Billions Short

The Treasury Department's mammoth wartime tax bill will go to the floor of the House by mid-July some $2.1 billions short of the Treasury's $8.7 billion goal. This appeared certain as the House Ways & Means Committee, after months of work on the biggest, toughest tax bill of all time, finally got the measure near the floor. Prodded into belated action by the President, wrestling with frayed tempers, the committee:

> Killed the sales tax which could have made up the difference and tapped the major source of inflation, increased wages. If such a tax is revived, it must now be done by the Senate or in a separate bill. (Probability: immediate revival after the elections.)

> Adopted a modified withholding tax. As the plan now stands, a 10% tax deduction from wages would start next January.

> Rejected proposals to pay back to industry after the war 14% of the excess profits collected from it now. The committee also let stand the 94% excess-profits levy denounced as "a danger to the full success of the war production program" (because it gives industry no incentive for greater production) by Donald Nelson, Under Secretaries Patterson and Forrestal, and Admiral Land.

> Turned down Franklin Roosevelt's proposal for a $25,000 limit, after tax deductions, on annual income.

> Picked up some small change by taxes on pari-mutuel betting, jukeboxes.

> Authorized the Post Office to increase second-class mail rates to a point where they would wipe out an annual deficit of $78,000,000 in this classification. This struck hard at newspaper and magazine publishers, for $78,000,000 is more than the combined profits of all the publishers in the U.S. The Post Office now gets 1.8-c- a pound for second-class matter, claims a loss of 6-c- a pound.

All hands steadfastly promised a final bill before election time.

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