Henderson daily dispatch. (Henderson, N.C.) 1914-1995, 1937-01-07

inheritance, license, special and sales
taxes. The problem of finding suff.-
Gent revenue to meet the imperative
needs OF an expanding state program
Will require the best brains and the
most industrious efforts of this en-
TIRE Assembly. I know you will ap-
proach this task with the sole pur-
pose OF doing justice to every person
and interest. In the pursuit of reve-
nue. North Carolina shall not go upon
any punitive expedition against any
class of our citizenship and, if addi-
tional taxes are necessary to be levied
the state should do so to meet the
pressing needs and not by way of pun
1shment to anybody.
There has been much discussion of
the sales tax. 1 know of the general
opposition to it and it would be a
source of genuine satisfaction to mo
II IL could be repealed, but after can
Vasslng the whole tax situation thor
oughly, l regret to say that 1 cannot
recommend this course, If we are to
MAINTAIN an efficient public service
TOT the simple reason that the neces-
sary revenue cannot be otherwise pro-
Vioed at this time. I do recommend
the exemption from the sales tax on
the basic necessities of life including
meals at hotels and restaurants and
the removal of determinations. I be-
heve better enforcement would re.
suit IN less unfair competition among
merchants. The merchant who deals
fairly with the state and his custom
ers in connection with the sales tax
ought to have protection from the
merchant who does not. The state is
going to see that the sales tax is col
lected from all and thus place all
merchants on the same footing.
This does not imply that the state is
not already doing we'll in the collec-
ton OF this tax, for more than one
thlrd OF the revenue, exclusive of
road funds, arises from this source.
ana 1t was collected last year for less
IMAM TWO cents on the tax dollar. How
ever, 1t is generally conceded that
many loopholes now exist for evading
the payment of this tax and, with the
ADDITION OF more auditors and a bet
ter check-up and some necessary
changes, increased revenue will be
realized
AT an early date 1 will transmit To
you the report of the Budget Commits
sion containing very full and well con-
sldered recommendations, at which
time 1 will make more specific sug-
gestlons to you with reference to the
revenue measure.
There is one thing of paramount i'm
portance in connection with the
adoption OF revenue measure-that
the receipts shall equal the expendi-
tures-that the budget shall be bal
anced. The federal government has
unlimited credit, hence it is not so
imperative that Congress immediately
balance it's budget. This does not an
ply to a state. An unbalanced budget
is disastrous to the state-its credit
suffers immediately interest rates adj
vance and financial embarrassment
follows quickly. North Carolina's
credit is good; she has never default
ed in any obligations and her bonds
sell above par, even at a low rate of
interest. We must maintain this fine
record.
CONSTITUTIONAL AMENDMENTS
Contrary to past experience, the five
constitutional amendments were an
proved by the voters in the last cleo
ton and this confers additional DOW
ers upon the General Assembly. The
adoption of these amendments was an
expression of confidence in the legis-
lative branch of government, but 1
nave no doubt that you will fully
JUSTIFY that confidence by prudently
ana wisely exercising these added
powers.
The authority to increase the mem
Dersh1p of the Supreme Court should
be promptly exercised because that
need is imperative and the instruc-
ZION was unequivocal. There seems to
be universal recognition of the wis
dom of this action.
The other four amendments deal
with our tax system and should be
studied with care and made effective
IN such manner as not to unduly dis
turb the economic balance Of either
the state, county or municipalities, or
make it oppressive upon any class of
cur citizenship. The proponents of
the homestead exemption amendment
wisely indicated that they would not
ask for it to be made fully effective
Immediately, but realized the neces-
sity of a gradual application of the
exemptions, beginning with q small
amount and increasing it as condi-
tons will justify. so that county and
municipal finances will not be seri-
ously or adversely affected.
The amendment authorizing the
classification of property is most vital
and should not be acted upon hastily
or without the fullest investigation
Unless you find it possible to make a
thorough investigation and obtain all
the facts necessary to Justify you in
formulating definite policy that will
be fair to the tax payers TO be affect.
ed and not injurious to either the
state, counties or municipalities, ]
would recommend that you authorize
the appointment of Commission to
study the question and subrnit the
facts, data and recommendations to
the next General Assembly. This is
embarking upon new policy and it
should not be adopted without proper
study and consideration, for the sue
cess of the plan will depend upon the
fairness and completeness of any Plan
adopted both with reference to the
taxpayers affected directly by the
classification and those not included
in the groups, but who may be vitality