The times-news. [volume] (Hendersonville, N.C.) 1927-current, 1933-01-28
ARE DRAFTING
TNOIAX Bills
Both State Measures Are On
Sales; Will Be Held Pend
ing Developments
By J. c. BASKERVILL
The Times News Bureau
Sir Walter Hotel

kALElGH, Jan. 2S.-1WO sales
tax bills are in PREPARATION for in
PRODUCTION in the general assem-
bly, at the suspicious moment, it
YVES authOritatively learned here
today, in spite of the secrecy with
which those interested in these
bills have sought to shroud their
activities.
One of these bills is a straight
out . per cent sales tax on gross
retail sales only, and is scheduled
for introduction in the senate
when the time is ripe. Indications
are that this bill will have very
strong support from the industrial
bloc in the senate and that it will
get very strong backing from the
tobacco companies, power COM
panieS, railroads and the other
large corporations that are anxi-
Gus to see a general sales tax on
retail sales enacted.
The second sales tax bill now
in process of construction is a
combination bill that embraces all
three types of the sales tax ideas
so far proposed-the manufac-
turers' production tax, the tax on
gross retail sales and the so-called
luxury tax-according to the in
formation obtained today. 1t is
the belief of those backing this
particular bill that by broadening
it out to include the manufactur-
ers as we'll as the retail merchants
and by imposing slightly higher
rates on so-called luXuries than on
necessities, it will not impose a
particularly heavy burden upon
any particular class.
This bill is being very care
fully prepared and the belief is
growing that if it becomes appar-
ent that a sales tax will be neces-
sary to balance the budget that
this bill will probably receive the
approval of the present admins
tration, but only as a temporary
emergency measure. So far,
Governor J. C. B. Ehringhaus has
declined to express himself with
regard to a sales tax. But If a
sales tax becomes the only thing
that will balance the budgct-and
an increasing number are getting
to be of the opinion that it is the
only think that will balance it
it is believed that Gov. Ehringhaus
will be more likely to approve the
combination sales tax that will
carry low rate to be widely dis
over both industry and
retail business, than a sales tax on
retail sales only. In fact, it is I'M
derstood that he already knows Of
this bill and that it already has his
tentative approval.
Neither of these bills are ex-
pected to be introduced until after
the pending governmental reor-
ganization bills have been dispos-
ed of. There are three reasons
for this. The first is that those
studying the states financial sit
uation want to wait to see how
many of the reorganization bills
are enacted and how much money
will be saved as a result. The
second reason is that the sales tax
do not want to muddy
the waters now by injecting any
new issues into the legislative sit
uation that might delay the con-
sideration and enactment Of the
reorganization bills. The third
reason is that the sales tax advo-
Gates do not intend to bring out
their bills until after all other eff
forts to balance the budget have
failed.
That the sales tax advocates are
using good strategy in withholding
their bills until after the assembly
and it's committees have spent sew
eral weeks in trying to effect SUI
ficient economies to balance the
budget or to find new revenue in
other quarters, is being generally
agreed. For there was little SEN
timent for a sales tax at the be-
ginning of the present legislative
session and there is little sentiment
for it now. But as the finance
committees get farther into their
task to find sufficient revenue for
the state, they are beginning to
realize that some new money-at
least $5,00O,0OO-is going to have
to be found from some sort, even
with all the economies that can be
made. AS a result, the belief is
growing, even among these power
fully opposed to any form OF sales
tax, that a sales tax of some sort
is going to have to be enacted in
order to balance the budget.
The retail merchants will of
course oppose it, as they have al
ways done, although they are al
most resigned to one already. In
fact, their spokesman here has al
ready publicly admitted that they
would rather have an out and out
sales tax than the so-called mer-
chants privilege tax now contain
ed in the proposed Revenue Act
that rnus up as high as fourteenth
of one per cent on gross sales.
The industrial forces will also OPP
pose the tax if it touches them.
But indications are that more
taxes are going to have to be levi
ed on some one, and that the sales
tax will be the ultimate solution.