Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1921-04-11
one PER CENT TAX !.
ON SALES IS PLAN
Senator smoot of Utah Will
Introduce Bill in Up
per Chamber
$4,000 EXEMPTION
Estimates Proposed Measure Will
Yield Two Million fear-.oees
Less Price Jumps.

Washington, April 1.-THE texC 2t
the sales tax bill introduced by Sdia,
tor Reed Smoot. of Utah, in the Sen
ate today was made public last night.
The bill imposes a. tax CT l ner
cent. on all turnovers, with an an.
nual exemption of $4,000, the effec:
of this being to exempt smaller farm
ers and tradesmen. 1t has been esti-
mated that the per cent would yiela
more than $2,O00,O00 annually.
In a statement n behalf of the gen
eral sales tax plan Senator Smoot de-
clared that its advantages are eX-
treme simplicity of assessment ana
collection, low tax rate applying un!
formly on all commodities, and ah-
sence of complicated features which
make it difficult for the taxpayer 20
know at any time what his tax ia
bilities are.
While the bill, as it will be intro
duced, provided Tor tax Of ! PEI
cent, Senator Smoot indicated that
the rate might % limited to one-hat
of ] per cent, or other alternatives
might be adopted. In his statement
he proposes thee alternative pro2o>
sitions. as follows:
/. A rate Of one-haf of ] per cent,
not to exceed per cent on all s@iesj
without distinction of .tEse-Tst.et ot'
.aaintegratef .eonserassss
2. e rate of three-four ms u ! pef.
cent, out rot to exceed ! L PER cant.
with credit for taxes prey 9's.y paid
on goods bought for resale.
3. A rate, of l per cent, but not to
exceed 2 per cent, without dist!nc-
ton of integrated OF unintegrated con
Germs. but exempting each dealer on
the first $4,000 Of annual sales.
SOP simplicity Of administration
and collection of the tax have con-.
c.uded to support the flrst-named
plan, and for the purposes of this h:l
have specified a rate Of per cap..
said Senator Smoot. IF at any time
the amount TO be raised from such a
tax IS to be reduced or increased. the
only amendment required TO the law
would DC to change the rate OF tax.
"The bill follows closely the provi-
sions of the Philippine sales tax,
which today is he most satisfactory
tax to all classes and the most pro-
d,active that is imposed in the lslan"s.
Merchants and Others making sales
subject to the tax would make quarter
" payments to the Government.
The bill exemgts sales and leases
made by the. United States Govern
mcnt States and municipalities, fore
ion Governments, mutual ditch or 1r-
rieation companies and hospitals ana
o.her corporatiohs organized and op-
era,ed exclusively for religious, charl-
table scientific or educational pu-ros-
pc and also goods sold or leased Tor
export.
The sales tax does not apply TO oes-
er,sges. cigars ano tcoacco, on "h:ca
taxes already are imposed by titles VI
and VII Of the present Revenue ac5.
l; also does not apply to few COM
modi:ies on wh.ch shere is now an eS-
else tax and waici is not repealeo ps
the bill. such as automobiles, automo-
bile trucks and wagons, motorcycles
and tires, parts and accessories yaehs
and moto,boats.
Senator Smoo. says that the TURF
over tax will % shifted to the ni1l-
mate consumer. but he contends 1ha'
the f;na! Increased price OF com
modify which has passed through hatE
a dozen hands will not be more than
ID per cent. Tie refers to De-
par5men, of Justice investigation II
connection with TIC Lever Focd Con-
trcl act in which the assertion vas
made ;ha: the excess profits tax was
responsible for az increase of % pc.
cent. in prices.