Evening star., 1932-12-14
MILLS SAYS BEER
TAX.N0 ENOUGH.
Secretary and Rainey Clash
| Over Treasury Estimates
i OF U. S. Income.
tcontinued From First Page.)

' VI ~ ~
tContinued From First Page)
the House probably would take up the
beer proposal next Tuesday He hopes
to have q vote before the Christmas
recess.
Citing the need for additional reve
nue., Mills urged the committee ito
take the leadership in promoting q
non-partisan program to balance the
budget by the adoption of general
manufacturers excise tax" He also
recommended continuation OF the i
cent-a-gallon gasoline tax.
Democratic sponsors OF the Collier
bill who see in it q means of cutting
down the deficit, have estimated that
with a tax of S. barrel on beer and
20 cents a gallon on wine, about $780,
100000 would be returned in revenue
annually.
The department believes" Mills
aAid, that the administration OF the
beer tax would be practicable though 1t
is not clear why the distinction IS
made between the fermented liquor
covered by the bill and cereal bever-
centum of alcohol by volume, the tax
on the latter being retained at the rate
of IA cents per gallon.
This seems illogical and may give
rise to difficulties of administration ana
l think you should consider whether
taX-paid beer should not be dlstlnc-
lively marked by stamp or otherwise.
License Tax Ambiguous.
Furthermore, the bill is ambiguous
on the question of whether the license
tax imposed on the wholesaler ana re-
taller Of fefmented liquors under the
internal revenue laws appneS 10 The
seller of the new beverage.
THE provision, however, relating to
the taxation of vinouS liquors appears
to the Treasury Department as lmpos-
sible of administration, in that 1t gives
no working definition Of what liquors
are subject to the tax.
"As to the revenue which might be
expected from the proposed tax on beer
at the rate of SIS per barrel, the Treas
ury estimates the amount at S125,O ,OOO,-
600 to S150000,000 for the fiscal year
1884. If, however, malt slrup, Whlch IS
taxed at a relatively low rate under the
present law, is subjected to compensa-
tory tax, the ultimate yield OF the tax
on beer could be increased somewhat.
Mills said the Treasury figured that
beer consumption in 1884 might
amount to 33,000,O00 barrels, or 42,000,-
600 barrels" depending upon the num-
Der of States in which its sale might
be made legal in the coming fiscal year.
He listed Is in which immediate sale
could take place after enactment OF
the legislation and nine IN which 1t
might be sold. But he then scaled
down for various reasons the Treasurys
estimate of beer consumption to from
n ho rro1c
Public Reaction Uncertain.
TT should be remembered that the
industry, at least as tar as legitimate
production and distribution are con-
cerned, is not now established ana that
home brew and bootleg beer are ap-
parently manufactured on very con-
siderable scale he said. The time
which would be required Tor the COM
mercial production and normal dlstrl-
button is problema.lcal.
Moreover, there is very considerable
uncertainty as to the change Whlcn
may have taken place in the pubic
taste for a beverage OF the alcoholic
content provided in the bill, parucu-
larly when consideration IS given 70 lne
number of younger men from u 10 50
who have not been accustomed 10 tne
use of such beverage.
After making these further ADJUST
rnents. we estimate the probable con-
sumption of tax-paid beer in the fiscal
wear 1894 at IS ,000, 900 barrels and
40 600 900 barrels, respectively, Tor the
two lists Of States. These figures IN
dicate collections in the amount Of
s125.OOO,O0O and Sl5000O,0OO, rcspec-
lively
states in which Mills said "the i'm
mediate sale of beer is reasonably Ger
tain" were listed as Arizona, California,
MARYLAND. Massachusetts,, Michigan,
Missouri. Montana, Nevada, New Jersey,
New York, North Dakota, Oregon, Penn
sylvania. Rhode Island, Washington
and Wisconsin.
Those in which "the early sale of beer
may reasonably be expected ne nsteo
as Connecticut, Colorado, Indiana, New
Hampshire, Delaware, Illinois, louisiana,
Minnesota and Vermont.
inevitable Mills said. however, that
with the general manufacturers sales
tax and continuation of the gasoline
levy the budget could be brought into
balance in the following year.
Beer Alone Insufficient.
The tbeer) measure standing alone
bring the budget into balance he in
sisted But if the committee should
favor its adoption. it could, in combi-
nation with these other proposals, be
made to furnish base of taxation suf-
ficently broad to give adequate assur-
ances of balanced. budget:
IF the gasoline tax be continued for
another year and a general manufac-
turers excise tax along the lines of the
measure reported by this committee at
the last session be adopted, the budget
can be brought into balance, and at the
same time number of the more in
equitable unproductive and administra-
lively undesira BILE existing excise taxes
be repealed.
The necessities of the situation
clearly call fer some such program. BY
June 80, next. We will have closed three
successive fiscal years with large
deficits.
While in the years 1881 and 1882
the Treasury sold substantial blocks OF
long-term bonds these deficits have In