The Incredible

A bill was signed last week which actually lowered income taxes. It was not signed by the President--Federal income taxes were still on the way up. It was New York's Governor Herbert H. Lehman, in Albany, who scratched his name across a bill cutting the State's income tax (one of the highest in the U.S.) by 25%. Net saving to taxpayers: $18,000,000 this year, $21,000,000 in 1943.

New York is one of some half a dozen States which turned up with a nice fat surplus this year. Mississippi also cut its income tax--from a base of 3% to 1 1/2%. But very few States are expected to follow the example of New York and Mississippi. From now on, most States look for bigger budgets (new war expenses, such as civilian defense) and less income (from tire and auto rationing, shortages generally).

Some tax experts thought a better idea than tax reductions would be for States to invest their surpluses in U.S. war bonds--thus helping the war effort to go forward faster, and at the same time restricting the public's power to spend.

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