Evening star., 1947-02-05

cost Of the item and collects 1t at the
time Of sale.
On the whole, business groups oppose
the sales tax. The Bosra Of Trade in
dorses it only If other taxes they
recommend are not acceptable. The
Federation of Business Mems Associa-
ton has turned against it and the
Merchants and Manufacturers As
sociation likewise objects. In general
terms the opposition of the business
man is based on his fear that customers
will desert him and buy in Maryland
and Virginia where the tax is not effec-
tive. Some dislike the idea of collecting
the taxes for the Government.
The Poor VS.. the Rich Argument.
Labor, liberal and veteran groups are
opposed also on grounds primarily that
it hits the poor man worse than the
rich, It is tax on spending, they say,
which Is what the poor man does with
his income while it does not touch
savings which are open to the wealthy.
Actually they look upon the sales tax
as a cut in wages for the poor man.
In general, this opposition group
wants sleeper rates and broadened
base for the income tax as substitute.
Proponents of the tax, however, argue
it is a proven money raiser and very
easy to administer and collect. It is
particularly adapted to Washington,
they contend, which has such a large
transient group of visitors annually
contributing nothing for the public
services they receive while here. All re-
cent amendments to the original West
plan are believed designed to tighten
the effect of the tax on low income
groups.
They deny it is unfair to the poor by
saying that the rich man buys more at
higher prices and hence will pay more.
Some of the champions of the tax come
from real estate groups who may feel
that unless the sales tax Is enacted real
estate levies will be boosted as they were
in the last revenue bills of 1937-8-s.
Some deny justification for the fears
of business, saying that New Orleans,
Los Angeles and New York have not
suffered although their surrounding
areas have no sales tax.
The argument has also been made
that ability to pay is already recognized
in the income tax here and rejection of
the sales tax Is only device for
exempting completely large segment
of the community that demands the
most from 1t. Under a balanced tax
program, it is contended, even low in
come groups should contribute toward
the services they receive.
While a number of key city officials
support the sales tax in principle, it is
officially to the District government
source of revenue. This is to say that
if substitute or groups of substitutes
acceptable to the community and Con-
gress can be found which will raise an
equal amount of money more equitably,
the Commissioners would gladly go along
with It,
Admitting, exclusive of prejudices.
there is merit to both sides of the con-
troversy, it is fairly obvioN that the
worst feature of the plan is the ''use"
tax simply on an enforcement basis. If
this could be covered with an alright
enforcement, business could have no
fear of outside competition because the
buyer would pay as much in "use" tax
as sales tax on big items.
District officials themselves have no
particular idea how they would admin
lister the use tax and apparently simply
want it on the books as a balancing
feature.