Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-11-01
TAX PLAN Brings
SWEEPING PROTEST
Restoration of Federal Excise
on Autos Opposed
by A. A. A.


The announcement to the effect that
the Treasury Department favors the
restoration of the Federal war excise
tax on motor vehicles as part Of its
tentative program for a "selectiye sales
tax" to balance the national budget, has
drawn q sweeping protest from the
American Automobile Association.
In defense Of its position, the national
motoring body quoted q resolution
unanimously adopted at It's recent an
nual convention, as follows:
Unanimous Resolution.
Whereas the motor vehicle is today
the most heavily taxed property In this
country, the American Automobile Assoc
citation Is unalterably opposed to Fed
eral tax on highway transport, whether
through an excise tar on motor vehicles,
accessories or parts, or through sales
tax on fuel, or through license fee for
motor vehicles or drivers"
In reply to the Treasury intimation
the American Automobile Association
said In part: leat M 5ys gs.lsg
THE placement Of the motor vehicle
on the tentative selectiye list Of the
Treasury Department is apparently
based on series Of false assumptions as
regards the character Of motor vehicle
property, the tax burden It already
bears, its contribution to highway build
ing and the effect Of q Federal levy.
The Treasury, for example, intimates
that the taxes now paid by motor
vehicles are nominal. Now, what are
the facts? In 1890 motor vehicle prop
erty IN the United States had valua-
ton Of approximately $500, 900 900
and maid than q f~fl1tnxa ALL .,~
In taxes. In other words, the motor
vehicle Is now paying at the rate Of
1873 per cent per annum Of its valua-
ton, which Is IL times as heavy as the
tax on rural real estate and times
IS heavy as the tax on urban real es-
tate. At the present rate, the average
motor vehicle through its life Of seven
years pays 1888 per cent Of its average
value. How can Treasury experts rec
oncile this fact with their intimation
that the motor vehicle Is today paying
only nominal tax2'
Answer to Treasury.
1.-THE Treasury Department init
mates that free roads are provided for
motor vehicles out Of public funds. To
answer this, it Is only necessary to
state the facts. In 1890 motor vehicle
taxes amounted to so per cent Of the
total highway bill. Considering that
roads benefit not merely the car own
ers, but the entire Nation, 1t viii be
seen that they are paying very large
share Of the cost of the right-of-way
they use. The Treasury Department
cannot solve the problem Of the rail-
roads by gripping highway transport
and the quicker this Is realized the bet
ter It win be for all concerned.
1.-THE reference Of the Treasury TO
Federal aid as o justification for
Federal levy Is another outcropping Of
the antagonism manifested by q GER
tain school Of political thought now
dominant in the Treasury Department
toward this great national policy. It Is
interesting to note that in mentioning
Federal aid, the Treasury makes no ref
erence to the fact that the motor
vehicle owners have already contributed
more than q billion dollars In the form
Of excise taxes which practically ball
ances the total outlay on Federal aid
to date.
without Foundation.
Equally without foundation Is the
the manufacturers would absorb Fed
eral tax placed on motor vehicles at
this time. It Is matter Of common
knowledge that the Federal excise tax
during its existence was passed on In
every instance TO the consumer. This
would certainly be done again.
mo American industry has been
harder nit by the depression than our
great motor industry. Last year there
was an actual decline in passenger reg
istration. and the indications now are
that there win be decline this year
In total registrations, including passen-
ger cars, trucks and busses A sales
levy would inevitably slow up the re-
covery of this basic industry and further
jeopardize employment.
Unfair Burden Alleged.
"Since the great majority Of motor
vehicles In the United States are of
the light weight, low-priced variety. q
Federal tax would bear hardest on the
farmers and the poorer classes Of the
motor-using public, for whom the car
has come TO be almost Is much Of o
necessity as food and clothing.
I'm the event that the Government
has to resort to new taxation In the
interest of balancing national finances,
1t Is most important that q policy
should be formulated with due re-
gard for facts as TO the tax status of
this or that article today. The con-
tention IL fair that the Treasurys in
timettens &c regards the motor vehicles
are No A accord with the facts"
the United states has TIA per cent
Of world passenger cars and 81 per cent