The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1933-06-27

The following article analyses
the workings of the sales tax law
in Mississippi one of the first
states to adopt the system and
pointed to as a model by advo-
Gates of this tax in North Dakota.
| BY J. OLIVER EMMERICH
| Editor, McComb (Mississippi)
| Enterprise
ut is soak the poor measure,
an annoyance to the public, and
an imposition on the shopkeeper,
believes this Mississippi editor.)
Budget troubled states of the ma
ton have centered eager attention
upon Mississippi's lately introduced
retail sales tax. In a sense this Stat'
has become q tax experiment station
and this experience can be relied upo1
largely to prove or disprove the sound
ness of the retail sales tax policy. i
is Mississippi's show, yet Mississip.
plans both applaud and heckle thu
program.
This new tax on bread and meat
and telephone bills and overalls ha.
balanced Mississippi's once badly dis.
torted budget. It has conserved Mis-.
sissippi's credit and preserved Missis.
sippi's institutions. It has been eff.
GENTLY administered by an able tas
commissioner, and courageously es.
poused by a governor devoted to the
task of balancing the income anc
outgo of a ship Of state whose finan-
cial sails have been badly battered.
The Mississippi retail sales tax is ar
emergency enactment. In fact, it Is
recorded as the Emergency Act OF
1882" and Is to be automatically re-
pealed on June 80, 1884. AS an emer-
gency revenue producer, it has helped
Mississippi. But after making these
admissions, there is preponderance
of injustices, fallacies, complexities
and impracticabilities which brand
the retail sales tax idea as unsound
in policy.
A physician wisely gave adrenalin
to patient who collapsed because OF
heart attack, but if he were to GO
about town promiscuously injecting
hypodermic needles into the arms OF
healthy men, he would soon be rushed
to an insane asylum or Jail. Start
ling and spectacular deeds may during
crisis be sensible, and yet be absurd
and ridiculous during normal times.
The chief trouble with our tax sit
uation during this emergency is not
altogether that taxes are too high but
that incomes are distressingly low
Many people could not pay their 1892
or 1888 taxes even if their tax bills
were slashed in half.
But let us get down to cold reali-
ties. In the first place, the retail sales
tax is founded on fallacy. Pro-
ponents contend that there are thou
sands of citizens who own no prop
erty and who pay no taxes, and that
the retail sales tax converts these tax
dodgers into tax payers. If this is So
then there has not been an individual,
company, or a corporation that has
collected dimes profit in fifty years.
Taxes must precede profit. The
renter pays the taxes with his rent.
Forget this emergency for the mo-
ment and consider this problem from
an all-time basis. If the retail price
OF an automobile does not carry a
proportionate part of the tax bill on
the automobile plant, the makers can
declare no dividends. The only way
man can dodge taxes Is to live in a
swamp, eat fish, and go naked. And
to make complete job Of it, he must
catch his fish with his hands or he'll
pay taxes on the factory that makes
fish hooks.
There can be no tax dodgers. Rea-
son declares it. Yet, friends of a re-
tail sales tax argue that a sales tax
puts the tax burden on an otherwise
taX-free people. Particularly is this
argument applied In regard to the ne
gro tenant farmers in Mississippi
The landlords, however, can be trusted
to take care of themselves. In Mis-
Sissippi 1t was reasoned that only fiji
teen per cent of the population paid
property taxes. Considering that only
family heads, and not babies and
school children, usually pay the direct
taxes, and that the average family
consists Of five or more, it would seem
from this figure that the percentage
Of property taxpayers Is surprisingly
high.
Printed reports of the Mississippi
Tax Commission indicate that the av-
erage monthly per capita sales tax
collected last year was only 81 cents
Yet, it Is freely admitted that prop
erty taxes are high; and Mississippi's
two million people paid four millions
IN ad valorem taxes to the state, which
is only 16 2-3 cents average monthly
per capita. All tax burdens, reduced
to per capita basis, seem compare
lively inconsequential.
A grievous objection to the retail
sales tax is that it is not equitable
In theory it taxes the capacity of an
individual to spend. In reality it
levies 100 per cent assessment on
the small wage Garner. The smaller
the income of an individual, the larger
is the percentage of his income that
goes into tax channels. It is "soak
the poor" tax. 1t Is paid in advance
particularly in the case of the poor
because they must pay before they
eat. 1t taxes most those least able ia
pay.
Indirect taxes shuttle to the bot
tom. The retail sales tax is q direct
tax which pyramids the cost which
the ultimate consumer must pay. II
broadens the base, so to speak, and
increases the cost of living Of those
least able to stand it. individuals
with larger incomes can make their
more expensive purchases from with
out the state, and escape the tax. Not
so with the poorer classes. They must
spend close to home. They cannot
travel.
The retail sales tax fails in that il
IS not economical to collect. Now il
Is highly probable that proponents Of
the retail sales tax will Immediately
think that have missed the facts
However, the trouble is that they havt
failed to think the matter through
The Mississippi State Tax Commits.