The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-02-21
M'NUTT SALES TAX BILLS TO BE
PASSED BY GAGGED LEGISLATURE
Both Houses in Caucus to
Shove Through Program
of Administration.
BAR PUBLIC HEARINGS
Approval Is Expected by
Night; Millions to Be
Melted by Plan.

legislature caucused today on
the highly controversial adj
ministration tax program,
which includes a $28,000,000
biennial sales tax.
Under leadership of Governor
Paul V. McNutt, and the whips of
his cohorts in and out of the legis-
lature, the bill is expected to re-
ceive caucus approval and be passed
by tonight without opportunity for
public protest to be recorded.
This will be the first time in leg
islative history that revenue bills
OF such Importance were acted on
in caucus and passed under sus-
pension Of the rules.
Public hearings always have been
held heretofore.
McNutt, so far, has been so sue
ceSsful with his caucus method of
putting bills across that it was de-
cided to follow the plan with the
revenue measures.
The major bill is a gross sales or
excise tax. 1t calls for one-fourth
Of l per cent on the gross income of
all manufacturers and wholesalers;
l per cent on all individual incomes;
l per cent on all retail sales, in
Guiding revenue of public utilities,
with general exemption of $1,000
of gross income on the excise tax.
Great Revenue Expected
Revenue from this bill was es-
timated by administration leaders
at from $12,OOOOOO to $14,OOO,OOO an
nually.
Companion measures, which will
aid in carrying out McNutts pledge
to wipe out the deficit and balance
the budget, call for restoration to
the state of half of the automobile
license fees now going to local gov
ernmental units and imposition Of
an annual 81 drivers license fee.
The state will assume a $500 SAL
airy payment for all common and
high school teachers and retain the
7-cent school tax levy. The 8 cents
Of the 15-cent total levy from prop
erty taxes will be wiped out under
the plan.
TEACHER salary payments will total
$12,480,000, there being 1890 COM
mon school teachers and 5000 in
high schools of the state.
School Cost Ont Soon
A 20 to 30 per cent reduction in
local school costs is estimated to
accrue from the plan of state pay
mentS.
McNutt, in explaining the bills,
said that the teacher bill will so
be amended as to prevent local
schools from merely considering it
additional revenue and not reduc-
ing costs.
The sales tax bill provides for
quarterly payments of taxes of more
than $25 annually, beginning April
10. Payments are due in January,
April. July and October.
Collections are under the state
treasury department.
IntangibleS tax bills, now pend
ing in the house, also are being
considered by the administration.
but will not be part of the major
program scheduled for action today.
Protest against the plan of pass
age through caucus and rules sus-
pension already has been voiced by
the Indiana State Chamber of
Commerce. Indiana Council of Re
tail Merchants, Retail Merchants of
Indiana and the indianapolis
Chamber of Commerce.
Balance Is Foreseen
Passage of the bills will leave the
state with substantial balance,
estimated at around S2,000.000, at
the close of the biennial period ac-
cording TO those who assisted in
drafting the program.
Here is how they figure:
Total needed for state expendi-
lures for the two-year period will
be s22,0o0,000. Taxes at AZ per cent
on a property valuation of $780,
100000 would produce an estimated
revenue Excluding delinquencies) of
S3,200,000; poll tax will add $780,
900; other revenues, insurance fees,
inheritance taxes and the like, So
100000. making an estimate total of
approximately s12,00O,000.
Diversion Of automobile license
fees to the state. including the
present funds that have not been
distributed, will be another $780,
900. Drivers licenses, which means
80 cents out of each 81, 10 cents 60
ing to collectors, means $4,000, 600.
since collections will start this year.
Other Revenues Listed
With a current estimated deficit
of $500 900, these revenues will
cover the s22,0OO,OOO expenditures.
leaving an estimated deficit of
s2O00,0O0
Estimated sales and excise rev.
enues are as follows:
Manufacturers, 81, 500 900; whole
salers, s350,000; retailers, $4,000 900;
railroads. $500 900: professional in
comes, 100000; public utilities,
100000; hotels and amusements.
100000, and all others, including
revenues from coal. oil and stone,
banking and the like, $50 900 900.
Total revenue produced by the sales
tax being s13,950,000 a year or APP
proximately s28,0OOO0O for the
biennium.
The bill providing for the $500
teacher salary payments is esti-
mated TO cost SIG 100000 for the
two-year period, with eight months
OF school.
This would leave exactly $1,000
600 to care for the deficit. Beer and
other taxes are expected TO add
S500 000 and intanpibles S3 600 900.