The Rock Island Argus and daily union. (Rock Island, Ill.) 1920-1923, 1921-09-30
SM|O0T ASKS
3 PER CENT
SALES TAX
Would Do Away With Oh
noxious Fifty Seven
Varieties.

Washington, Sept. 30.-A manu-
facturers' sale tax of three per cent
was formally proposed to the SEN
ate today by Senator Smoot, Re-
publican, of 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, transporta-
ton. telegraph and insurance taxes,
the taxes on soft drinks, ice cream,
cosmetics, admissions and dues, and
all of the other ST varieties of OBJ
noxious, discriminatory forms of
taxation which would be repeal
ed on next Jan. l, under a series
of amendments to the revenue re-
vision bill offered by the senator
Wants Profits Tax Repealed.
Repeal of the excess profits tax
as of last January /. instead of on
next January l, as planned by both
the house and the senate finance
committee, 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 inherit
ance taxes.
The sales tax amendment read:
THAT in addition to all other
taxes, there shall be levied. assess
ed, collected and paid upon every
commodity manufactured or pro-
duced, when sold, leased or licensed
for consumption or use without fur
ther process of manufacture, tax
equivalent to three per cent Of the
price for which such commodity
is sold, leased or licensed; such tax
to be paid by the manufacturer or
producer"
Explains Amendment.
at should be noted" Senator
Smoot said, that as the tax is i'm
posed only when articles are sold
for consumption or use without
further process of manufacture
that the tax will be non-cumulative
in effect and will give the integral
ed business no advantage over the
disintegrated business. There will
be but one tax. If commodity is
sold for consumption or use in a
further process of manufacture no
tax will be imposed. For example,
crude oil sold for fuel would be
taxable, but if sold to a refinery
for the making of gasoline or like
commodities, would not be tax
able
I'm order to avoid administrative
difficulties with small sales, the
bill provides for an exemption of
all sales Of less than $4,000 during
one year. This will exclude about
l per cent of the manufactured
goods in the country, according 20
the census of manufacturers. 1t
will practically exempt all the ag-
ricultural products since the aver
age value of products of firms for
this year, has been estimated by
the department of agriculture at
between $1,000 and $4,000, but as
most agricultural products would
find their way in manufactured pro-
ducts, they would be exempt any
way under the definition of the tax.
Tax on Imports.
Provision is made for a like tax
upon similar imported commodities
so that there can be no discrimina-
ton against American products.
The yield OF this tax has been
carefully estimated and approved
by one of the foremost economists
in the country, Professor Charles
]. Bullock, of Harvard, to produce
during the calendar year, 1922,
$3.50, 756 900 Conservatism has
been exercised throughout this esti-
mate. The yield will be undobuted-
ly close to 81 600 900 .0G0 but the fig
ure given is more than ample to
provide the revenue which would be
lost by the repeaIs which l pro-
pose.
"Return to Prosperity
81 want to see a rate revision of
tax laws, and not the perpetuation
in times of peace of revenue laws
which were devised under the
emergency of war.
Il want to se6 a return of pros
perity for the American people and
believe We can bring it through the
enactment of a proper tax system.
Il believe that these amendments
will accomplish the desired result
and / know that the people through
out this country are of similar be-
lief. from general approval which
the plan has received"