Evening star., 1949-06-23
City Heads Approve
First Of New Sales Tax
Amended Regulations

4ue urSL OF C0e new ana amend
ed regulations being worked out
At The District Building in prepa-
ration for the city's new revenue
act, which goes in effect August !,
have been approved by the Com
missioners. it was announced yes
terday.
One group of amendment per-
tains to income and franchise
taxes. and principally concerns un-
incorporated businesses.
Regulations concerning the sales
and use taxes were approved in
connection with natural or ar
tificial gas. oil, electricity and solid
fuel and steam.
Meanwhile, Tax Assessor Ed
ward A.. Dent is working on other
new regulations to govern admin
istration of the 2 per cent sales
tax.
Additional Clauses Seen.
Additional amendments to the
income and franchise tax regu-
lation with respect to individuals,
estates and trusts will also be nee
essary later. Those already ap-
proved pertaining to unincor-
porated businesses adapt the reg
u1ations to the new act. which re-
duces the exemption from $4,000
to $4,000 and places limitation
on the amount that can be de-
Quoted for salaries.
The regulations provide that the
aggregate deduction by such busi-
nesses for services by individual
owners or members conducting
the business shall not exceed 20
per cent of the net income of the
business. computed without bene-
fit of the deduction. =
The regulations dealing with the
tax on fuels and electricity pro-
vide the levy shall be imposed on
any sales for purposes other than
resale to persons registered under
the sales tax act or for use in
manufacturing. assembling. proc
essing or refining.
Examples of the latter excep-
ton would be use for operating
machinery. lighting and heating
q factory or shop.
Nontaxable Category.
Use Of the fuels and power in
cidental to. but closely connected
with production. such as lighting
drafting rooms where products
are designed. operating a first-aid
room and plant air-conditioning
is considered to fall In the nom
taxable category.
The fuel sales are taxable, how
ever. If consumed in the admin
istrative or commercial phases of
the business. such as in general
Offices, sales and display rooms.
retail outlets and the like.
The tax does not apply to re-
ceipts from sales to the United
States or District Governments OF
their agencies. sales which a State
could not tax under the limita-
tions of the Constitution and sales
to semipublic institutions when
the gas or electricity is used in
carrying on their work.
Must Present Evidence.
Purchasers of fuel or electricity
claimed exempt from the tax must
present satisfactory evidence 10 the
tax assessor that the sale is ex-
empt and must obtain a specific
exemption.
Under the definition Of sales
price" in the acts cash discounts
or sales are not included.
Meanwhile. representatives of
the Districts $50 drug stores will
be told just how to operate the
2 per cent tax on gross retail sales
by four tax experts at 8:15 o'clock
tonight in the Henry B. Gilpin Co.
auditorium, Ali South Capitol
street.
The speakers will be: Assistant
Corporation Counsels Harry L.
Walker and George F. Lynch;
Robert j. Wilson, executive direc-
tor Of the Washington Restaurant
Association, and H. j. Althouse,
auditor of the Peoples Drug Stores.
The proposed plan, which is sub
ject to final approval by Assessor
Edward A. Dent before the new
levy goes in effect August !, calls
for use of a taxometer in COM
putting tax collections.