The Commission of Federal Paperwork's final report to be sent to President Carter by Oct. 3 will contain 750 recommendations for cutting paperwork that could result in annual savings of $10 billion.

Yesterday the White House issued its own blast against red tape. President Carter declared, "Many existing federal requirements are confusing and unnecessarily difficult to comply with. They produce mounds of paper. Some applications for grants arrive in Washington in crates rather than envelopes.

Reforms he recommended include cutting the number of forms, standardizing and simplifying others, reducing required federal audits, and increased use of letters of credit to allow recipients to draw funds when needed.

In the course of its two-year study of 85 major federal programs and organizations, the commission found that government paperwork costs the public and private sectors over $100 billion a year. The cost of the federal government is $42 billion: to industry $32 billion. Filling out long, duplicative, often unnecessary forms also causes an immeasurable amount of anxiety, frustration and anger.

The problem begins at the legislative level where Congress routinely chooses paperwork to set up monitor and evaluate programs, depending on universal reporting rather than on-site inspections, audits or sampling. It is compounded at the executive level by agencies that either do not realize that other agencies have requested the same information from individuals and businesses.

The commission concluded that perhaps as much as a quarter of the $100 billion burden could be a eliminated without impairing the government's ability to function effectively.

At a meeting yesterday, the commission conditionally approved the establishment of a Department of Administration, whose chief would have cabinet rank. The new entity would consolidate policy, service and operations now handled by other agencies.

The commission will recommend that the Department of Administration:

Combine the functions of the National Archives and Record Service: the Automated Data and Telecommunications Service, now under the General Services Administration, and the Burneau of the Census. It is also considering encompassing the Civil Service and the Federal Supply Service.

Publish the Federal Register.

Develop and maintain an information locator, and index registering all data already collected by the government. It would not, however, actually store the data in a giant computer.

Standardize federal, state and local programs, such as tax returns.

Of its 750 recommendations, 301 have already been accepted by the agencies concerned for first year savings of $3.5 billion. Twenty-two were rejected, and the remainder have not yet been acted upon.

Not surprisingly, the commission found the single largest economy could be realized by reducing the paperwork surrounding welfare programs. Having one application blank for the six major programs would result in savings of $1 billion annually. The administration's proposed merger of three welfare programs will save $750 million annually in paperwork costs.

Although the commission was unable to develop a comprehensive picture of just how many forms Americans fill out unneccessarily, it did find some surprising statistics. For example, the Department of Transportation requires truckers to fill out logs every 15 minutes whether driving or not. This results in 1.2 billion sheets of paper a year. All these sheets of papers lead to only 300 prosecutions a year of drivers who worked more than 10 hours a day.