Evening star., 1937-06-16
Further Study of D. c. Tax Bill
Reveals Likely Ne,c Inequities
More Questions Pop Up to Plague Payer
of Leuies, Who May Haze to Pin
Faith on Charges in Senate.

guard, such as is written. for instance
into the business privilege (sales) tar
Of West Virginia
Point Held Important.
At the District Building it is sug.
gested that such condition could be
covered fully in regulations and def
nitions which might be drafted by the
Commissioners under general authority
to be conferred on them in the bill. Or
the other hand. observers explain
there must have been reason why
the West Virginia Legislature inserted
such safeguard into its act.
That the point is important is seer
in the fact that Washington store:
generally follow the practice Of giving
customer credits for returned goods
whether or not the customer already
has paid for the articles, If there i;
reason for the goods to be returned.
The District bill defines gross re.
ceipts" as meaning the gross receipt.
received from any business in the Dis.
trict Of Columbia. including cash
credits and property of any kind OF
nature. without any deduction there.
from on account of the cost of the
property sold, the cost Of materials
labor or services or other costs. in.
terest or discount paid. or any Other
expenses whatsoever"
State Law Contrasts.
Yy, net 70
ginia law states that gross income anc
gross proceeds Of sales against which
the tax is levied) shall not be con.
strued to include cash discounts al
lowed and taken on sales: the proceed.
Of the soles Of goods, wares or mer.
chandise returned by customers wher
the sale price is refunded either ir
cash or by credit; or the sale price o.
any article accepted as part payment
on any new article sold, If the full salt
price of the new article is included
in the gross income or gross proceed.
Of sale"
There is another question: Suppose
q person invests q portion Of his gros!
receipts in bonds. He would be taxed
Of course, on all his original gros.
receipts. But when he sold the bond,
to obtain cash would he have to pay
the gross receipts tax again on the
same sum, or merely on the gros.
income represented by the interes
paid on the bonds?
An amendment which the Hous,
District Committee yesterday agreed
to seek to have inserted in the bill wa.
designed to take care Of such stu.
ations in financial houses, but it wa!
not clear today that this safeguard
would apply to other business con.
Germs or to individual business worker,
who invested funds on occasions as {
by-product OF their regular business.
Deductions Not Allowed.
Reference to the quotations from the
the District and the West Virgins
measures, cited above, also reveal that
the District bill does not provide de.
ductions from gross receipts ON &C.
count of discounts allowed in busines,
transactions. In West Virginia such
a provision is a part Of the law, not
left to possible regulations by taxing
authorities
The House District Committee. in q
move to protect the little fellow,
agreed it would seek an exemption OF
$1,000 for all persons from the taxable
gross receipts. This does not 60 nearly
so far as the exemptions written into
the West Virginia law. In that State
there Is a general exemption OF $25
from the tax to be paid. not from the
tax base. In other words, under the
suggested District exemption from the
tax base would figure down to IS in the
tax payment exemption, - against $2t
tu-West Virgins, - -~..,.,-..-- 2 :