Evening star., 1932-05-23

that reason, the people have accepted
the manufacturers sales tax with better
grace.
Some Oppose Levy.
Among the editors replying are some
who hold views opposing the manufac-
turers' tax on the ground that it is 6
tax on consumption and retards busi.
ness. and that it falls on the poor mar
as well as on the rich. But even its
opponents admit that the manufac-
turers' sales tax does what is expected
of tit raises revenue so badly needed
by the government. They say further
that people have accepted it and ap-
parently feel the effects of the tax less
than had been expected.
The manufacturers sales tax wa.
levied as an emergency measure to meet
some of the costs of the World War. II
has been at rate as high as per cent
and as low as l per cent. Recently il
was raised again to per cent because
of the great falling off in revenue due
to tthe business depression. An effort
was made to substitute for the present
manufacturers sales tax turnover
tax to be levied every time an article
taxes. The turnover tax suggested was
at rate of 2 per cent. But the view OF
Canadian business was more favorable
to the present sales tax, levied only once
on the article sold by the manufacturer
even at the higher rate. Furthermore. a
turnover tax would be pyramided and
fall more heavily on the consumer, 1t
was argued.
Proves Least Troublesome.
L. H Dingman, president Of the
Times-Journal. St. Thomas. Ontario
said in his reply to The Star:
Canada has adopted the sales tax as
one of the least troublesome means of
raising revenue, and it seems to be
working satisfactorily. To allege that
any tax is popular would be an over
statement, but the Canadian people
know that money has to be raised and
willingly fall in line with reasonable
demands.
1.-The sales tax has just been raised
from to cents as one Of the measures
needed to balance Canada's budget and
If there is any general or important
objection to the increase 1t has not been
made public.
zone factor that is more or less in
favor of the increased sales tax is the
instability of prices of merchandise.
The great uncertainties which have OBJ
tanned for some time have caused prices
to vary greatly. Moreover. retail prices
of many lines of merchandise are the
lowest in years, which is another factor
in an easy application of the increased
sales tax
"The effects were much more notice.
able some years ago, when the sales tax
was increased from l to cents. High
hot IN
added sales tax was felt by the buying
public.
THE increase from 4 to cents seems
to be accepted with the realization that
it would not have been imposed had the
federal government not found it abso-
lutely necessary in order to help in bal
ancing the budget.
Equitable and Effective.
D. Smith, manager, Daily Times
Journal, Fort William, Ontario, said:
The sales tax has been in force in
Canada for some IL years. and is recog-
nized as a satisfactory method CT rails
ing part of the taxes which the public
realizes have to be raised to meet ex-
penditures.
NO tax is entirely popular, but deal
ers and consumers with whom We have
discussed the matter think that the tax
is equitable and effective. 1t is fair
tax which reaches every buyer.
The tax for manufacturers has
varied at different times, having been
as low as per cent. Several years ago
1t was raised to 6 per cent, and after
dropping to 4 per cent. and then to 2
per cent, was raised this year to per
cent. at which figure it now stands.
The tax Is collected at the source
that is, from the manufacturer, who
either shows the tax as separate item
or absorbed it when billing the goods.
He is licensed, and all purchases from
other manufacturers must bear the
license number allotted to him.
"Mocthly settlements are made to
the government. Books of record are
checked periodically by government
agents.
at is important that the tax be COL
lected on the finished article as it
passes to the ultimate consumer, other
wise it's application to all sales would
be difficult 1t was selected by the Do
minion government in preference to a
turnover tax"
How the Tax Is Viewed.
J. S. Woodward, managing editor, the
Saskatoon Star Phoenix Limited, Sas-
katcheWan. said:
THE well known adaptability of the
human race makes it possible for us to
stand almost anything, and to get ac-
Customed to the sings and arrows OF
outrageous fortune. Consequently, !
Imagine that the majority of the people
of Canada do not in fact know that
there is such thing as sales tax in
existence. 1t operates, so far as the
consuming public is concerned, no
doubt quite effectively and almost pain
lessly. One objection to it is that it
operates so effectively that costs are
automatically raised without people
realizing it, and they are thus con-
tributing to the national eXchequer on
q large scale without appTeciating the
fact that they are being taxed to do So
1.-THE objection which the consuming
bubble, or that part of it which realizes
What is going on, has to the tax is that
It is unequal in its incidence. That is
to say, the people with large incomes
do not really contribute in this way
their share to the national eXchequer
Organized farmers and labor leaders
are frequently heard to this effect, but
I believe I am safe in saying that, by
and large, the rank and file OF the con-
Euniing public, do not realize that per
cent is being added to the cost Of their
purchases, and I suppose that 6 per
cent is not a very great proportion IN
some cases, at any rate. For example,
q aspackage of cigarettes which sells foI
rs cents, yields no less than l8 cents CT
that in the form of one tax or another
10 the federal treasury.
Machinery Is Simple.
$50 far as the business interest is
concerned, all organized business which
is vocal through chambers of COM
merce, manufacturing organizations,
and so forth, have gone on record 0S
preferring the sales tax with its simple
machinery to the turnover tax which
was under serious consideration by the
government at one time. The effect OF
The turnover tax would have been
cumulative in that every stage from
manufacturer to consumer would have