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

PEELED to serve as TAX COLLECTORS WIFI
out pay. It does not take into consid'
Grafton the efforts of tens of thous
andS of clerks who must make hun
dreds of thousands Of petty transac'
tons. It fails to consider that thes|
5000 imposed upon merchants ant
their thousands of clerks must make
these collections not once year, bu
every day; not in stores alone, but al
filling stations, hotels, restaurants
lumber yards and SO on.
This costly situation, which Is more
or less exasperating, may be ignored
in general consideration of this sub.
ject, but If merchants are interviewed
as have interviewed scores Of them
it would be readily seen that the ef-
fort and inconvenience, to say nothing
of the expense, are irksome. The cost
of collecting this tax from the mer-
chants may be low, but the cost OF
collecting from their customers Is i'm
measurably high.
The retail sales tax lacks fiscal ade-
quacy, that is, productivity. A two
per cent sales tax on all merchandise
sold, on all telephone, telegraph,
power, light, and gas bills, on all in
trastate railroad passenger and freight
receipts. and a one-eighth of one per
cent jobbers' tax, and one-quarter
of one per cent manufacturers tax,
all combined in Mississippi yielded but
two million dollars. Compared with
the total taxes paid to the state, coun-
ties, municipalities, and other sub
divisions, this is mere bagatelle. In
truth, the mountain labored.
| Eight mills ad valorem brought the
state only four million dollars. If this
were replaced by sales tax, it would
be necessary to increase the sales tax
to six per cent. A six per cent sales
tax would be confiscatory to business.
And yet, even with a six per cent
sales tax there could be comparatively
little property tax relief, for the
burden in this state, as in other
states, is largely with local, county
and municipal governments. A low
sales tax does not justify the immense
effort and annoyance. A high sales
tax would be ruinous to the business
life Of any state.
The structure of the sales tax is
simple, but the system Of collecting
it from the public Is both complex
and complicated. Many merchants
absorb the tax. Others shift it along
to their customers. There are varied
schedules Of collections. For example,
grocery merchants Of McComb, Mis-
siSsippi, population 10,05D adopted
the following schedule: sales from
Sol to SIC tax exempt; $40 to $50,
one cent tax; $50 to $1.19, two cents
tax; $1.20 to $1.59, three cents tax:
and on up.
After a few months 1t was discov-
cred that this schedule was made
quate for suburban grocers because
the average sales were so low that
most of the trade fell in the tax
exempt classification. Uptown stores
| in most instances lost q few cents
daily or broke even on this schedule.
Credit grocers found it simple enough
because they charged the two per cent
to their accounts at the end Of the
month.
Dry goods stores in this city adopted
the following schedule: sales under
SIS tax exempt; $.26 to STA, one cent
tax; SIS to SIPS, two cents tax. Drug
stores maintained schedule of their
i own arrangement. Five and ten cent
stores absorb the tax. Stores selling
| usually in odd figures such as %
cents, 48 cents, 81 cents, find it easy
to absorb and collect the tax.
One haberdasher whose chief COM
petitor absorbs the sales tax ex-
claimed, Most Of my items are sold
in even figures, Is cents, so cents,
and dollar. How can I absorb the
tax without a loss? But what else
Is there to do?" This lack of uni
formity indicates the complexity of
this type OF taxation.
The retail sales tax is also disturb
ing factor in business. Conditions
would be different If all states adopted
the sales tax law. But why fool our
selves? All states will not adopt such
a system. With border states free
from this commercial handicap, home
merchants are penalized. Particularly
Is this true in border counties, and
thirty -four of Mississippis eighty-two
counties are on the border.
Incidentally, we should not confuse
a federal sales tax with a retail sales
tax. If the federal government were
to impose a sales tax, 1t would be COL
lected directly from the manufacturer:
from the tire maker, for example, and
not from ten thousand retail tire
dealers. It would be a different Sit
uation entirely.
Mail order houses are indisputably
benefited by a retail sales tax. All
| out-of-state merchants can offer q
| discount equivalent to the sales tax
charged within the state. A discount
Is sales advantage. Large opera
tors would welcome a shifting of the
tax from property to a sales tax. It
would be simple enough for such OPP
orators to purchase most Of their mer-
chandise from without the state and
thus escape taxation. Talk about tax
dodgers! The retail sales tax points
the way. Furthermore, If a tariff is
protection to business, then, most
assuredly and undeniably, q retail
sales tax Is the reverse.
Now here Is another serious obiec-
ton. At best, people complain q great
deal about taxes. Why remind the
public every hour Of the day OF tribute
to Caesar? Why demand taxes every
time person buys a meal, q hotel
room, or pair of socks? There Is q
moral liability to good government In
this situation. It Is psychological
bad. Instead Of being q painless tax,
as advocates say, 1t Is a constant dull
headache. This form Of taxation Gre
ates resentment, and this resentment
Is registered against the government
People are human, and the human
element Of people cannot be disre-
garded. In Mississippi many COM
plants have been silenced because OF
9 patriotic realization that our state
is confronting an emergency, but de-
spite this appeal to patriotism and
| reason the sales fay il l,nr>nys,lor ond