Tax Program

This week the Eisenhower policy on taxes crystallized into a clear-cut, five-point program. The five points: P:Extend the excess-profits tax on corporations six months from next June 30, the scheduled expiration date, and let it expire next Jan. 1.

Allow the reduction of approximately 10% in personal income taxes, as scheduled, next Jan. 1.

P:Continue the present regular corporation income tax instead of allowing the 5% reduction scheduled for next April 1. The reasoning: demands of the U.S. defense budget will not permit a cut in both corporate and personal income taxes; and the President believes that personal taxes should be brought down first. P: Continue thesocial-security tax at its present rate (3% on the first $3,600 of annual income, divided evenly between employee and employer) instead of permitting a scheduled increase to 4% to become law next Jan. 1. P:Continue the present excise taxes instead of permitting reductions next April 1. In their struggle with the tax-budget problem, Dwight Eisenhower and his aides are now well aware that they inherited a solid contradiction from the Truman Administration: defense expenditures were scheduled to reach their peak in the same years that taxes were scheduled for sharp cuts. The President and his advisers ultimately decided that there was no way to cut taxes this year and still protect the defenses and the economy of the U.S.

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