Evening star., 1951-02-19
u. ). Can Hold Down
BootIegging ifLiquor
Tax Rises, Agent Says
BY the Associated Press

The chief of the Governments
'revenooers" confidently predicted
today that his agents can handle
any bootlegging and moonshining
problems that might arise from
increasing the liquor tax to $12 a
gallon.
The chief enforcement difficult
ties would be encountered in the
South. Deputy Commissioner
Carroll E. Mealey, in charge of
the Internal Revenue Bureaus
Alcohol Tax Unit. told the House
Ways and Means Committee.
AS part of the administration S
current program to raise a first
installment" of SO billion in
new taxes, the he~committee is con-
sidering a proposal to increase
the tax on whisky and other
distilled spirits from SO a gal
Ion to $12. 1t is proposed to boost
the levy on beer from SO a bar
rell to $12, and make various in
creases in the tax on wines.
Would Mean $7O6 Million More.
Altogether, the increases are
calculated to raise an additional
$706 million, bringing the Treas
ury's income from alcoholic bev-
erages to $3,206. 100000 a year.
This is entirely feasible, Mr..
Mealey told the committee, scoff-
ing at suggestions that the pro-
posed increases would raise an
insurmountable enforcement prob
lem.
Mr.. Mealy said that SO per cent
of the volume of violations for the
entire country in the last fiscal
year took place in the South. 9th
erwise, he said, there is little or
ganiZed traffic in contraband
liquor except in the metropolitan
areas on the East Coast. He said
several groups. made up mostly
of former convicts. are operating
on an interstate basis in the
Pennsylvania New Jersey New
York-Connecticut = Massachusetts,
area. producing and distributing
high proof beverage alcohol.
Earlier Predictions Recalled.
Mr.. Mealey said that every time
the alcohol tax rate has gone up,
there have been predictions it
would cause a serious law enforce
ment problem. Actually. he said,
the tax has been raised from $2.25
a gallon in 1888 to SO gallon as
of today. with considerably fewer
law violations in all sections of
the country.
Some members of the House
committee have said they fear a
widespread increase in illicit liquor
making and sales if Treasury Sec
retary Snyder's tax plans are
adopted.
Representative Dingell, Demo-
crat, of Michigan. is among COM
mittee members feeling that
higher liquor taxes will encourage
moonshiners, bootleggers and
smugglers-on the theory that tax
evasions become all the more
lucrative.
Soft Drink Tax Mentioned.
"This kind of tax is going to
stimulate bathtub gin again." he
protested. It'll bring back the
conditions we had under prohibi-
ton"
Mr.. Dingell and Representative
Eberharter, Democrat, of Pennsyl-
vania, another committee member, |
have mentioned the possibility of
taxing soda water and other soft
drinks. This was not among Mr.
Snyder's recommendations, but he
said such tax at penny a bottle
would bring in about $3.50 million
q year.
A Republican committee menl-
ber, Representative Kean of New
Jersey, recalled data submitted to
the committee that the cost of pro-
ducing legitimate whisky is only
about SIS Oh so cents a gallon. He
noted that means the proposed
tax is more than 20 times the cost
Of the product.
MI. Kean told reporters he Won
dered if retail sales tax on liquor
might be easier to enforce than
the present tax on liquor manu-
facturers.