The sun., 1919-07-19
SOFT DRINK TAXES
ARE BEING EVADED
Collector Edwards Sends Out
Investigators to Watch
Small Stands.
DIFFICULTY OF THE JOB
There Being No Check Upon
Sales, Guesswork Is Re-
quired-S50,00O Sought.

Any one who knows Of any system by
which william II. Edwards. Collector Of
Internal Revenue, can collect for the
Government the coda water and ice
cream tax that the little soft stun stalls
Of Park Row, the East Side and The
Bronx should produce will be received
with open arms at big BiTs' Office in
the Customs House
The new 10 per cent tax on ice cream
and soft drinks that went into effect
May 1 should yield, according to the
Treasury Departments figures and facts
regarding the New York city dispen-
saries of such luxuries, an income ap-
proximating 100000 every thirty days
| during the summer months. Nothing
like that amotnt has been collected for
either May or June. Figures for Greater
New York were not available yesterday
because Mr.. Edwards was not in his
Office and his subordinates declined to
talk. but 1t Is known that four Of his
agents are doing the rounds of the little
stands hoping to find tax return delin-
quencies amounting to $4,000 or more.
1t was learned that Brooklyn and
Long Island yielded a return of about
| s65,000 in this sort of taxes for the
month of June. Furthermore II Is ad-
| United that this amount Is far below the
| sum that should have been collected.
1t was explained that the larger drug
stores confectionery shops and other
! more responsible establishments. where
| soda water. Ice cream and the like are
| sold to the multitude, keep check upon
their sales by medium Of the tax
| ticket. Likewise they keep record Of
such sales. and tho collection Of taxes
from these places Is automatic.
Problems OF Small Stands.
But II is the small. cheap stall In the
| congested districts-the three by four
stalls where once the cent ice cream
| cone, the two cent ice cream brick, the
| two cent soda water and the five cent ice
cream soda was to be had that develops
| the problem that Is worrying the revenue
collectors.
1t is estimated that $500 of these
places have sprung up since the prohibit
| ton law went into effect. Added to this
number are $500 already existing. max
ing 5000 little one fixture soda stalls
that should be sources of large tax re-
| turns. The difficulty in collecting these
| taxes Is fourfold.
First these small stands do a heller
| SHELTER business that is conducted on no
| scientific lines. A cent tax Is added to
| every purchase of 10 cents or less.
| About SO per cent OF the sales at these
places average much less than 10 cents
each. Conceding that the stall proprie-
| tor knows the law and intends obeying
| II, he throws the one cent tax into a
| cigar box and there II accumulates. In
many cases the amount becomes SO great
| that temptation overcomes the proprie-
| tors honesty.
| And again q great majority OF these
proprietors are aliens unable to speak
English or to understand It. The new
law means absolutely nothing TO them
as they do not understand Il. They
manage to learn enough to add few
| cents to their former prices because raw
| materials are more expensive and the
word has gone around that all the big
places have raised their prices. Natur-
ally no taxes are returned from these
| places.
There are those who plead that they
| believed that no tax return was to be
made upon a scale OF less than 10 cents.
The fourth class comprises those who
| know the law but have no intention of
obeying it; the out and out dishonest
type.
MT. Edwards's Hope.
1t is from these small dispensers that
Mr.. Edwards and his staff hope to collect
about $4,000 or so a month If they
can find a way to do 1t. There are at
present just four investigators trying to
locate these unbridled sources of revenue.
1t Is admitted that such a number is
totally inadequate. but the staff is short
of men.
There being no check upon sales, the
| Investigators compute by observation the
daily sales of a stand and multiply by
thirty, thus giving them an approx
mate monthly figure on which to tax the
proprietor. To the legal 10 per cent tax
is added per cent by way Of a factor
of safety. 1t is a hit and miss propo-
sition, but so is the business
| It was learned yesterday that not
only have these small stalls been de-
lnauent, but some of the larger estab-
lishments have not made honest returns.
The prosecution of these proprietors will
be prompt, ipasmuch as they keep books
and their books will be subpoenaed.
Sot only have the ice cream and soda
water places been found careless. but
| mo