Evening star., 1937-08-31
FOOD DEALER TAX
TEST CONSIDERED
Migration of Wholesale Mer-
chants to Virginia Secuted
at Meeting.

Threats Of court fight against
the new District business tax were
heard last night at meeting Of
wholesale food merchants at 5l4
Twelfth street southwest, but the re-
ported movement to migrate to Vir-
ginia apparently collapsed.
r. D. Marshall, controller of the
Terminal Refrigerating and Ware
housing Corp, presiding, advised the
commission men Lot to rely on upset.
ting the tax in court, but to concen-
trate their fight on upsetting 1t at the
next session of Congress.
Citing the taxes which Virginia
levies on food dealers, Marshall added:
II should think that would clarity any
talk of operating in Virginia"
Sees Prohibitive Costs.
After the meeting he termed re-
ports of a general exodus Of the COM
mission men to Arlington County
ridiculous" He said the taxes across
the Potomac and the added expense
of doing business from base there
would make the cost prohibitive.
There was no talk at the meeting
of an exodus to Virginia. although
several merchants previously had pre-
dicted this outcome unless way
could be found to exempt dealers from
the new tax of two-flfths OF l per
cent on gross income.
The meeting was devoted mostly to
q detailed discussion of the recently
enacted tax act and its application
to commission men. There was nc
formal action, but indications were
plans would be mapped at later meet
ings to form a united front for move
against the tax next Winter.
Several Of those present favored test
ing the new act in the courts. One tax
consultant said he planned to test the
act and invited merchants to join him
in court action.
Marshall, who has been a legisla.
tive representative Of business inter.
ests for years. said the commission
merchants should organize and EN-.
ploy counsel for a determined flgh'
to repeal the law.
Advises Tax Payment.
There is nothing the Commissioner.
can do but enforce the law mean.
while" he added. "and I advise each
of you to make your return and pay
| the tax. You could, of course, pay i
into court under protest and challeng'
the constitutionality Of the law, bu
I question whether you would get any
| where"
He said, however, that the Com
miSsioners and their tax experts
would be glad. If they could, to adjus
individual inequalities in application
| of the new law.
In reply to questions, he said Mary
land and Virginia merchants woult
have to pay the tax If they sent sales
men into Washington or consummatet
known sales here. He admitted ther'
might be ways to circumvent tn
assessment, such as telephoned O
mailed orders.
What" he was asked, "is to pre-
vent Maryland merchant from estab
fishing a food depot in Hyattsville ant
sending truck to pick up order
there?"
Expects Clarification.
Marshall admitted he didn't know
what could be done about that. Severa
features of the law, he said, rematnet
to be ironed out.
He said it might take an 20 @ P q
to determine whether an outside deale
was evading the tax.
Asked what would become Of tn
small commission merchant who di
not make sufncient profit to pay tn
tax, Marshall said he supposed sucl
dealer would have to 60 out Q
business.
He blamed the House for adoption
Of the present law, declaring tn
Senate District Committee had oppose'
it and most Of its members had agrees
with him that the food industr
should not be forced to bear such
tax.