Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-08-24
Controller Orders Postmas.
ter General to Demand
Refund From D. c.
GOVERNMENT MAY GET
$4,000 UNDER DECISION
All Other Departments Likely to
Be Affected-$3 Permit Fee
for Drivers O. KID.


cision to the Postmaster General,
made public today. ruled that the
Federal Government shall not pay
the gas tax in the District of Column
bia.
The decision was rendered in the
case Of the Washington City Post
Office and the Postmaster General
was advised.
THAT demand should be made on
the tax collectors of the District OF
Columbia for a refund on taxes col
lected on deliveries of motor fuel for
official use in the motor vehicles or
the Washington City Post Office.
May Affect All U. S. Autos.
although the decision does not spe-
officially say that 1t will apply to the
whole Government. 1t was accepted
everywhere as precedent ana as
meaning that no tax can De paiu py
the Federal Government on all the
thousa nds Of gallons used in Its cars
among all Government departments
and establishments.
Collector Towers estimated from the
invoices which Postmaster mooney
had been sending him that the totai
refunds to the post office here wouiu
be more than $4,000. -.
What the entire Government mere
would have to pay had not been ng
ured out by District officials early TINS
afternoon. but they believed II would
he a very large sum, and would cut
dent in the revenue from the gas tax'
which is used for highway develop
ment in the District.
Expects 1t as Precedent.
District Auditor Donovan said he
had given preliminary. study 10 tne
decision by the controller general, ana
believed it would be precedent Tor the
whole Government machinery mere lil
Washington, He was going to make
an intensive study, he said. and go
into the matter thoroughly to see what
other State laws were. and how some
collected the Federal tax, while others
did not. e
At the Post Office Department Off
cials said that the decision OF the con.
troller general had been received, ana
that it seemed to be broad in its scope;
They said demand would be served
shortly upon Collector Towers Tor the
entire amount Of the tax paid on gaso-
line used by the city post office.
The controller general in his deci'
sion upheld a recent ruling by Auditor
Donovan that the District could tax
the operators of Government vehicles
bv collecting frohh them the So cost
of an operators permit. Trafnc ln-
rector Eldridge had started to issue
such permits free to Government OPP
orators. but Auditor Donovan held up
this practice until final decision coulo
be reached.
About 5000 Operators.
There are about 5000 operators ~
Government cars in the District. MAJ
Donovan said, and pointed out that
this part of the McCarl decision would
thus permit the District to coiiect
$4,000 This gain, however. he esil'
mated, would probably he EreatIE on
set by the huge loss to the local gas
fax through the controllers decision.
Under preyious decisions of the Con-
+roller General some States collect
gas tax from the Federal Government.
Including Maryland and Virginia.
while others do not.
Under advice of the corporation
counsel of the District, the dealers
have heen adding . cents to the cost
of each gallon in making up thelr
bids for the Government contracts.
Postmaster Mooney had been calling
upon District Collector OF IaNes
| Towers monthly for refund Of the gas
tax. but the collector had consist
emily refused to make the refund.
records at the District Building show.
This office" wrote Collector Towers,
.'is without authority to refund the
tax Maid upon gasoline which Is USED
in motor vehicles. Any abatement OF
| this tax is between your Office and
the importer" Collector Towers also
quoted the provision in the gas tax
act which provides for refunds to be
than" drivers of motor vehicles.
After q conference at the District
Building today Auditor Donovan and
Collector Towers said they tnought
provision in the gas tax law concern
| ing refunds might complicate the mat
! ter of making collections from the To-
| cal revenues. Collector Towers, now
| ever, would not indicate what action
| he will take when the demand ~
served upon him from the Post Office
| Department for return of the more
! than $4,000. A provision in the gas
| tax for making refunds. he pointed
| out referred only to the tax on gaso-
| line used in "other than motor vehi-
| cles, and in such cases the refunds
must be made within 80 days.
Virginia Tax Ruling.
| In deciding that the Federal Gov
4 ernmGnL pay td]N W ' IL SAhias
, which imposes 4 cents a. gallon, Con
troller General McCarl ruled in simi-
lar fashion as he did in the case of
! South Carolina and some other States
that the tax was on dealers for the
privilege of doing business and not
| on the consumer.
| The controller general in holding
| that payment must be made by the
Federal Government to the State of
! Maryland for gasoline tax said, In a
| synopsis of his decision:
THE Federal Government cannot be
required to pay the tax as such as
| sessed by the Safe Of Maryland on the
[ sale of gasoline. but II dealer in the
State In fixing the price of the gaso-
/, line to the Government included there.
In an amount sufficient to cover the
| tax no objection TO the payment of
the price thus fixed can be made upon
the ground that tax was taken into
consideration byGthe dealer in fixing
1t, the question of huw the price was
| arrived at being immaterial"