The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1909-11-26
CUT THE TAX ON OLE
THAT is THE PLAN OF THE SEC
RETARY OF THE TREASURY.
How the Law Can and Is Evaded: the
Dealers Color the Product Enabling
the Manufacturer to Get Away
From the Ten Cent Assessment;
Now the Scheme Is to Repeal the
Statute.


This is a story sent The St. Paul
Pioneer Press by its Washington COR
respondent:
Washington, Nov. 20.-One chapter
of the forthcoming annual report of
the secretary of the treasury will be
read with alarm by dairymen of the
northwest, and it is expected to give
an impetus to the movement that has
been started to push a bill through
congress reducing the tax on oleomar-
garine made in semblance of butter
from 10 to cents pound. Secretary
MacNeagh is now working on his re-
port, and it will soon be made public.
Northwestern senators and represen-
tatives knew when they left Wash
ington i'll August that one of the big
fights in the coming session would be
waged over measure providing the
repeal of what is known as the anti
oleo act. Manufacturers of oleomar-
sarine bitterly opposed the enactment
of the law, and they are determined
to wipe it off the statute books if pos
sble. This effort will be resisted by
the dairy interests of the United
States.
May Repeal or Modify the Law.
The present administration of the
treasury department is in favor of
modification or repeal of the anti-oleo
act on the ground that it is difficult
of enforcement, and that it offers loop
holes for fraud. as result of which
the internal revenue bureau loses thou
sands of dollars year in money that
is withheld illegally.
In place of the present anti oleo-
margarine act Secretary MacVeagh
favors the passage of bill imposing
flat tax of cents pound on oleo-
margarine, colored, instead of "a of
cent on the uncolored and 10 cents on
the colored product as provided by the
existing law. The fiat rate, it is ar
gucd, would remove the temptation of
dealH"s to defraud the government.
Dealers Color Original Product.
Under present circumstances, it is
pointed out, dealers buy uncolored oleo
upon which the lower tax has been
paid, and by the use of artificial mat
ter color it to resemble butter, sell it
as such, thus saving the amount of
the maximum tax. Instances of such
violations of the law are not sporadic,
but general, according to officials of
3 the treasury, and they insist that there
will be no improvement IN this state of
affairs until congress revises the law.
Under the bill to be presented at the
coming session of congress it will be
provided, first, that colored and uncol-
ored oleomargarine shall bear fiat
rate of taxation, and the amount will
in all probability be fixed at cents
a pound. This tax it will be further
provided, shall be, paid by the manu-
facturer.
To Be Sold in STAMPED Packages.
As precaution in safeguarding the
revenues there will be a provision in
the bill prohibiting the sale of oleo-
margarine except in subdivisional pack
ages, each such package to bear an in
ternal revenue stamp, such as is used
by manufacturers of cigars. With such
law In force, it is contended the
special agents of the internal revenue
would be required to watch only the
manufacturers, whereas under the pres
ent conditions it is impossible for these
officers to keep under surveillance the
dealers that buy uncolored cleo, color
in %
competition with the legitimate product.
Treasury officials assert that the pro-
posed law would be beneficial to the
dairymen, and produce more revenue to
the government than is now collected
on oleomargarine manufacture. They
argue that oleo is now illegally sold as
butter in such tremendous quantities
as to seriously affect the business of
buttermakers.
Dairymen Vigorously Object.
When the tariff bill was up in con-
gress last summer the senate commit
tee on finance gave some consideration
to proposed bill containing provisions
as outlined above. The dairymen heard
of it and entered an emphatic protest
against the passage of such measure.
During the recess the packing inter-
ests have continued the agitation for
the repeal or an amendment of the
anti-OleO act, and it is understood to
be the purpose of Senator Lorimer and
Representative Boutell, both of whom
live IN Chicago, to introduce a bill re-