The New York herald., 1921-06-29
FIRST LUXURY TAX
INDICTMENT FOUND
Century Old Fifth Ave. Fancy
Goods Firm Pleads Not
Guilty to Charge.

Martin ,& Martin. 100 year old firm
selling saddIery. leather goods and
fancy articles. at 61S Fifth avenue. New
York. and also in Philadelphia and Lon
don, and Herbert P. Martin. their sec
rotary and treasurer. were indicted yes
terday by the Federal Grand Jury. They
are charged with defrauding the Gov
ernment by withholding luxury taxes on
articles sold.
William Hayward, United States At
torney, said this. was the first indict-
ment against "ewaders of the luxury
tax whom he purposed bringing to
book mo matter whether they are a
large firm in Fifth avenue or a small
merchant on the East Side who makes
q shop girl pay cent tax on soda
water and failsito pay 1t to the Gov
ernment.''
Mr.. Martin appeared before Judge
Knox in the United States District
Court and pleaded not guilty for him
self and his firm. He gave $4,000 bail.
According to. Mr.. Hayward and AS
sistant United States Attorney Maxwell
S. Mattuck the firm was In the habit Of
making ouu two sales slips for an article
on which a. luxury tax Is imposed. One
properly listed the article sold, the
other named some other article on which
there Is no tax.
They did not attempt to save their
customens from the payment, but on the
contrary made them pay every time. but
put the amour. OF the tax in their own
pocket" Mr.. Hayward said. 1T was
just plain stealing This was emphat-
icaliy denied by Harold A. Content,
counsel for the firm. He soid that in
hastily scanning the indictment he had
found one item on which he knew the
tax had gone to the Government. and
that any omission on the part Of the
firm was due to a mistake such as
might be- made in any business.
The Indictment has thirteen counts,
twelve OF which charges violation of the
reve que act OF 1918 and the other con-
spiracy to defraud the Government.
One Of the counts says the firm coll
lected from Mrs. Cornelius Vanderbilt
tax Of 50 cents on a suit case sold to
her onl Jhnuary Z last but did not re-
port the ttax to the Collector OF Internal
Revenue. on April 90 Constance Tai
madge, actress, paid $40 for n silver
cocktail shaker bought as a present for
her hustslnd. J. Pialogu. The luxury
tax should have been $3.50 and Miss
Talmadga paid it, but, according to Mr..
Hayward. the sale was recorded as
SADDLE. harness and spurs. $780," ar
tN-bcS ofl nFiicl tdA WIS Quc.
Among other sales on which, accord
ing to the indictment, luxury taxes were
not paid TO the Government are First
National Pictures. Inc, coat case. tax
81 : Mrs. NJ. w. Ryan, leather riding
crop, tax 60 cents: Glen Craig Tobis,
two walkfng sticks, tax $3.50; II. j.
Halle, kite bag, tax $3.50. and John"
Ferguson. trunk. tax $3.50.
Me- Cot ttent said last night: 1.-THE
main busir ess OF Martin & Martin is the
sale Of saddles. harness and brides and
nine-fenths of what they sell Is not
taxable. 1t would be surprising IL no
mistakes were made in tax returns on
the other articles when you consider
such facts vas this There is no tax on
suit case sailing for $40. but there is on
n subt case selling for s51. I have not
had time to study the indictment care
fully, but have already found one mis-
take. l nave known Mr.. Martin for
twenty years. His reputation is of the
highest"