Evening star., 1932-05-27
The Senate's Opportunity.

The Sonates opportunity is at hand
to write into the pending revenue bill
a general manufacturers tax as a sub
stitute for host of special sales taxes
and nuisance taxes, some of them who'll
~ unfair to the producers and to the
public. After weeks of debate first in
the House and then in the Senate. 1t
has been clearly demonstrated that the
manufacturers tax, at low rate, levied
once on the business of general manu-
featuring, is not only the surest method
of raising the revenue so greatly needed
by the Federal Government to balance
its budget, but also Is the fairest to
the manufacturers and to the consumers.
The tax, as proposed by Senator David
I. Walsh of Massachusetts,. is at the
rate of It's per cent. Covering a wide
field. the tax will fall lightly on pro-
ducers and consumers.
Prices of commodities have reached
q low level. In December of 1881 the
prices of finished commodities were
approximately twenty-nine per cent
lower than in 1926 If the manufac-
turers tax were passed on to the con-
sumer, and in many instances it
would not be so passed along, due to
intense competition for business, the
consumer would find he was receiving
a reduction of twenty-seven per cent
in the prices he paid in boom times 1t
ie oI,I hot x,-;tb lou
manufacturers tax such as now pro-
posed is far less of hardship to the
people than in times of higher prices,
when the addition of a small tax merely
still more oppressive.
The Walsh manufacturers tax
amendment exempts from its opera
tions foods and agricultural products,
all except high-priced clothes. and
farmers and workmens implements and
tools, medicines. etc. So effective, how
ever, is this form of tax in raising
revenue that even with the exemptions
allowed aid with the low rate of taxa
tion imposed 1t is estimated to bring
into the Federal Treasury about $685.
100000. With this added revenue. the
Congress will be in position to strip
from the revenue bill many of the
special sales taxes on manufactured
products row carried in it and many
so-called nuisance taxes
The manufacturers tax. in the judg-
ment of the House Ways and Means
Committee when 1t had the revenue bill
before it, was the most effective and the
fairest and the least subject to objec-
tion of the forms of taxation presented
to that committee This was the view
of the Democratic and Republican
members alike. A very small minority
of the committee held otherwise. And
now it is reported that in the House
itself majority of the members have
come around to the view that their
WAYS and Means Committee which
studied the whole tax problem so thor
ouehly were. after all, correct in their
Judgment when they wrote a general
manufacturers tax into the bill Under
such circumstances if the Senate acts
favorably on the Walsh amendment
proposing the manufacturers tax. there
is every reason to believe that it would
be agreed to finally in the conference
which must come between the two
houses of Congress on the revenue bill.
The prompt adoption of the manu-
facturers tax by Congress would make
it possible to dispose of the revenue bill
and let the country know what it must
expect in the matter of taxation. For
months past many industries and busi-
ness houses and the whole people, have
been entirely at sea as to what to ex-
pect. The backing and filling of
Congress, the writing in and writing
out of tax items in the revenue, have
served to confuse and alarm the public.
The very fear that after all, the Con-
gress would not act to balance the
budget and maintain stability Of finance
has arisen in many minds. Happily,
the leaders in Congress and the rank
and file as well have declared that the
budget must be balanced. Time, how
ever, has become of prime Importance.
The legislation for balancing the budget
must be put through now, not two
months hence.