Capital journal. (Salem, Or.) 1919-1980, 1921-09-30
PROPOSE
MAKERS
SALE TAX
Smoot Introduces a
Manufacturers Tax
AS Substitute For All
War Taxes


Washington, Sept. 30.--A man
ufacturers sales tax OF three per
cent was formally proposed to the
senate today by Senator smoot.
republican, Utah.
The senator explained that this
would be in substitution for "all
OF the various war taxes, the ex-
else taxes, luxury taxes, stamp
taxes, capital stock tax, transpor-
tatfon, telegraph and insurance
taxes. the taxes on soft drinks, Ice
cream, cosmetics. admissions and
dues, and all Of the other 81
varieties OF obnoxious. discrimin-
atory forms OF taxation" which
would be repealed on next JAM
uary / under a. series Of amend
ments to the revenue revision bill
II offered by the senator.
Retroactive Repeal
Repeal Of the excess profits tax
as of last January | instead OF on
next January 1, as planned by
both the House and Senate finance
committees, also was proposed by
Senator Smoot. Under his amend
ments, the corporation income
tax would remain at 10 per cent,
but there would be no change In
the present tobacco, liquor and
inheritance taxes.
The sales tax amendment read
tThat In addition to all other
taxes there shall be levied, as
sessed, collected and paid upon
every commodity manufactured,
or produced when sold, leased or
licensed for consumption or use
without further process of manu-
facture. a tax equivalent TO per
cent OF the price for which such
commodity is sold, leased or
licensed; such tax to be paid by
the manufactures or producer"
Non Cumulative
TT should be noted" said Sem
ator Smoot, that as the tax is
Imposed only when articles are
sold for consumption or use with
out further process of manufac-
ture' that the tax will be non
cumulative In effect and will
give the integrated business no
advantage over the disintegrated
business There will be but one !
tax. If commodity is sold for |
or use in further
Process of manufacture no tax will }
.bo Imposed. For example, crude
OH sold for fuel would be taxable,
out IL sold to refinery for the &
making of gasoline or like COM '
nicdities would not be taxable. b
$4,000 Exemption d
in order to avoid administra- s
tive difficulties with small sales, a
the bill provides for an exemption b
of all sales OF less than $4,000 Il
during one year. This will exclude
about one per cent OF the manu- a
factured goods In the country, ac- h
cording to the census OF manu- "
facturers. II will practically ex~ !
empt all the agricultural products h
since the average value of pro- .
ducts OF farms for this year has =
been estimated by the department
OF agriculture at between $1,000 :,
to $4,000, but as most agricultural Z
products would find their way :,
into manufactured products, they :
would be exempt anyway under q
the definition OF the tax. 8
Provision Is made for a like u
tax upon similar imported com :
so that there can be no :.
discrimination against American 81
products.
Yield A Billion IT
THE yield Of this tax has been q
estimated and approved 81
,y one of the foremost economists h
n the country. professor Charles al
!. Bullock of Harvard. to produce
Turing the calendar year 1922,
1859, 1855. 900. Conservatism has sa
'een exercised throughout this vi
stimate. The yield will undoub- co
edly be close to $1,000, 0,0OO,O 900. he
'ut the figure given Is more than tn
mple TO provide the revenue he
which will be lost by the repeals an
Which ] propose. WI
Il want to see a real revision
I our tax laws and not the per- =
in times OF peace
Z revenue laws which were div
led under the emergency OF war.
II want to see a return OF pros
Gritty for the American people
nd believe We can bring Il thru
he enactment OF a proper tax sys-
IN.
Il believe that these amend
ents will accomplish the desired
suit and / know that the people
lroughout this country are OF
milar belief. from general ap-
oval which the plan has re-
lived -