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Show I . Washington Snapshots The Knutson tax reduction bill now before Congress recognizes the need for allowing each taxpayer taxpay-er to retain and spend a larger share of his own earnings. It would cut the present high taxes by from 10 to 30 throughout the income scale, and by permitting husbands and wives to divide income in-come for tax purposes, and by increasing in-creasing exemptions, would reduce tax bills by an estimated $6,300,-000,000. $6,300,-000,000. However, thoughtful observers in Washington say the Knutson measure fails, by a big margin, to do enough toward rebuilding the nation's supply of "risk capital" the equity capital needed to start new businesses and expand existing businesses. Consequently, say these observers, the Knutson bill, even if passed without crippling amendments, amend-ments, will fall far short of reme-r dying the shortage of risk capital that already is threatening to turn the nation's present boom into a "bust." Federal statistics show that this risk capital has been provided, pro-vided, historically, by individuals with incomes of $10,000 a year or more. Under the present system of "soak-the-rich" taxation, individual indi-vidual income taxes up to 85 for the highest brackets have been skimming off most of the individual individ-ual savings that historically have been plowed back into businesses to finance expansions, reconditioning, recondition-ing, and improvements. The only remedy for the risk capital shortage, these observers say, is a much more far-reaching thorough revision of the whole income in-come tax rate structure. |