FISCAL: $5 Billions Down

Sad-eyed, hard-working Fred M. Vinson had a pleasant task to do this week. It was one that no other Treasury Secretary had done in 16 years—recommending a tax reduction. He told Congress that the Government could get along with $5 billion less revenue in 1946. That reduction was just about the total of tax collections in prewar years. By prewar standards, taxes would still be high (some $27.5 billion), but the Administration’s program was good news all around.

It would repeal the 3% “normal” income tax, thus eliminate some 12,000,000 low-income Americans from the collectors’ lists and lower the collectors’ take from many more millions of middle-income earners. It would also repeal the 85.5% excess-profits tax on corporations and would end (on July 1, 1946) the high wartime excises on furs, jewelry, transportation, cosmetics, etc.

The House had three weeks in which to argue the bill. There would probably be a lot of horsetrading there and in the Senate. But an accomplished tax cut would be dear to the hearts of Congressmen facing elections in November. Perhaps in less than a month U.S. citizens could figure exactly how much lower their 1946 taxes would be.