Evening star., 1949-05-15
Traveller; Notebook
Tax Dodge May Reopen Travel Levy Issue
BY Jacques Futrelle. Jr.
rha Ssars 1ruxsl EoiteF

near the Canadian border. Not
only are certain American busi-
nesses losing a substantial part Of
their income. but the Federal Gov
ernment Is losing revenue.
| Detroit an Example-The De-
troit area displayed. perhaps. the
most unrestrained eagerness to
beat the tax" When Canada
dropped the levy, Detroiters fiocked
to Windsor. Ontario. just across
the border. There they besieged
the Office of an American airline
company. Policemen were called
out to maintain order in the long,
slow-moving queue. What the
Americans sought were open
tickets" Under an international
agreement, airline Offices are per-
mitted to sell tickets from any
point in the world to another.
BY observing certain company
requirements. purchases can be
made by mail. In general. these
company restrictions specify that
the transfer of money has to be
completed within Canada. One
United States airline with an office
in Canada explained that fare
payments will be accepted by mail
in American cash. ,or its equiya-
lent in Canadian currency. Tele-
graphed money also is honored. as
are some forms of drafts.
| Any test case raised by Internal
Revenue is likely to revolye around
the question of whether payment
by the traveller actually occurs
within the United States. without
paying the tax.
The Office of another American
airline in Windsor Is reported do
ing a business of $4,000 or more
day. This is entirely out Of pro-
portion to its sales before Canada
repealed its tax. Meanwhile,
offices of all airlines of Detroit s
American area are withering on
the vine in a drought Of sales.
American business and industrial
companies with branches in Can
ada also are availing themselves
of the Is per cent saving by buying
tax-free United States transporta-
ton through employees across the
border.
Special Arrangement for Sales
i The mail-order business. prior u
| March %. was more or less tn
secret of smart money" travellers
And 1t could not always be worked
Some airlines profess to refuse u
sell to any one suspected OF rig
ging up a purchase with the pri
mary purpose of avoiding the tax
In fact. a particularly fiagran
case might come under scrutin,
Iof internal revenue for violating
the intent of the law. Offices o
Canadian steamship and railroad
companies in Canada are bi
more skittish than airlines IN thi
tax-free mail-order business.
The boldest approach to sellinl
untaxed airline tickets came las
week. The American Aviation
Daily. published here by American
Aviation Publications. told OF 1t IL
its issue last Monday The sale
Arrangement was worked out b,
LAMSA, a Mexican subsidiary o.
United Airlines. Aviation DAILY
reported;
i "Airlines travels throughout th'
United States will be able to avoie
paying the Is per cent transporta'
ton tax by buying tickets by mai
or wire In Juarez. Mexico. effective
today.
| Cashiers checks. postal none,
orders or O Western Union none,
| order may be sent to the LAMSf
Office In Juarez. Tickets viii b
sent by return mail"
&s,s
/ Contributed to European Repeal
Transportation tax avoidance
by the same methods as are nov
being used. was responsible ir
part for the sudden dropping oi
the levy on travel to Europe
Smart money" was buying trans
portation tickets. principally fol
1T-onfin,,ad IN page H-7 Col. a.