Evening star., 1955-01-12
Food Tax Lag
Being Studied
ByAssessor
Entire Stoff Seeks
Reasons for Low
Rute Of Receipts

District Tax Assessor James
L. Martin said today he has
assigned his entire staff Of
auditors and investigators TO
checking the sales tax returns
of grocers.
The collections from the / per
cent sales tax on food, which
went into effect last August !,
have been running far below
expectations.
In fact, the collections have
been running at such a low flg-
lre as almost to indicate under
ilourishment of District resi-
dents. Mr.. Martin said the re-
turns indicate that only about
"a a week per person is being
spent for. food. He believes the
figure should be from SO to
$3.50.
Returns Tagging.
1--WE are not getting full and
complete returns from grocers
now," Mr.. Martin said. He added
that this is partly because Of
errors, but that in some in
stances small merchants may
have spent the tax money col
lected from customers and then
did not have the cash to pay 1t
into the District government.
Need for plugging all revenue
loopholes was pointed up yester-
day when President Eisenhower
sent to Congress a proposed pay
increase for Government work.
ers which would cost the District
~ million.
Repeating an earlier state
ment. Budget Officer Walter L.
Fowler insisted today that any
pay raises must be accompanied
by legislation to finance them.
His statement substantiated
disclosure in The Star last Sum
/ day that the Districts proposed
budget for the next fiscal year
is so, tightly balanced that it
cannot absorb ever the raise
recommended by Mr.. Eisenhower.
s Cites 1S49 Slow Start.
Mr.. Martin also pointed out
that, when the Q per cent sales
tax, which did not apply to food,
went into effect on August /,
1949, it took six months to get
complete returns.
IIB The ! per cent food tax coll
IHlections are running 81 million
laA year, or 28 per cent below the
estimate Of $3,5 million. The tax
L collections on 800 million worth
Of groceries and meats amounts
ITO 81 million.
Mr.. Martin. conceded the pre-
liminary estimate may have been
too high. but not % per cent of.
He explained that grocers who
collected the 2 per cent tax on
brooms, mops, pet rations and
other non-food items had to re-
port their gross sales. Then they
deducted the sales on which the
2 per cent tax was not paid.
This gave the assessors Office
figures on food sales 1t believed
were accurate.
Here are the food sales tax
collections by months. so far. as
tabulated by the Office Of Walter
c. Thompson, deputy admins
traitor Of the Sales Tax Division:
August. $l56.483.
September. $184,707.
october, $185 1858.
November. $181 ,693.
Tax returns for sales In De-
cember are not due until Janu-
ary 20.
Delinquencies Increase.
Since November included the
Thanksgiving feast day 1t ap-
peared odd that the November
total fell below October's. Mr..
Thompson said this may be
explained by the increase in de-
linquencies. When the new law
went into effect, there were 500
merchants delinquent in the re-
turns they had to make on the
2 per cent tax on non-food items,
There are now 1000 delinquents.
Those delinquent in turning
In the taxes collected are charged
U q s per cent penalty plus in
terest at u of ! per cent q
month. A real violator-- Just
q tardy taxpayer--may be
charged in Municipal Court and
fined UP to $500 on, conviction.
Some customers near the Dis
trict boundaries are going into
Virginia and Maryland to avoid
the food tax. The results are
not particularly significant from
the point of view of total tax
collections, but they are highly
important to the grocer on the
District side of the line who Is
affected.
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