Evening star., 1956-03-14
Treasury Views
On Liquor Tax
Will Be Aired
By ROBERT X. WALSH

BY ROBERT X. WALSH
Treasury officials. cheered by
House approval of another con-
tinuance of present rates on cor
poration income levies and vari-
Gus excises, prepared to testify
today on suggested changes in
the tobacco and liquor tax sys-
TEN.
The proposed revisions were
among numerous recommends
tions reported yesterday by O.
Ways and Means Subcommittee
on technical and administrative
aspects Of the excise tax struc-
ture.
Although the subcommittee's
still unfinished study does not
deal with tax rates as such, it's
report to the full committee,
estimated that some of the moves
10 make excises more equitable
and efficient would cost the
Government about $12,550, 900 a
year. But this would be prac-
tically offset by $12.5 million in
expected additional revenue
resulting from other provisions,
the report said.
Shortly after Subcommittee
Chairman Forand, Democrat Of
Rhode Island. announced the
subcommittee's decisions and
observations. the House over
whelmingly passed a bill re-
quested by President Eisenhower
to continue the So per cent cor
poration income tax and several
existing excises on alcoholic
beverages. tobacco, automobiles
and automotive parts.
Loss of 50 Billion
Those rates would automati-
cally drop April / unless ex-
tended by Congress. This would
mean a revenue loss of almost
So billion. Senate leaders pre-
dicted their branch would ap-
prove the extension within the
next two weeks.
The subcommittee's almost 70I
specific proposals or suggested
administrative improvements
covered a wide range and con-
tained such varied recommended
tions as these:
/. Elementary and secondary
schools and colleges and uni
versities operated by profit
organizations would receive anI
exemption currently enjoyed by
public schools and similar tax
supported institutions. This
would free them from paying
manufacturers or retail excise
taxes on transportation and
communications.
Cut in Club Dues
2. The Ways and Means Com
mittee. in the opinion of the sub
committee, may want to review
and reduce to 10 per cent the
present 20 per cent tax on club
dues and cabarets, night clubs
and similar establishments.
8. In the case of the cabaretI
tax there should be a clearer
definition of its coverage so that
1t would not apply to places
where no alcoholic beverages are
served, where only light re-
freshments are available, where
there is no charge for dancing,
and where music is obtained
from phonograph or jukeboxes.
4. In an effort to remove re-
ported competitive discrimina-
ton against radio, television,
phonograph and other electronic
devices. a manufacturers excise
tax should be levied at 10 per
cent on transistors, tape and
wire recorders and record play
ers. The report also recon-
mended a per cent tax on gas
incinerator garbage disposal
units and vacuum cleaner at
tachments for waxing floors and
one-cent-a-pound tax on tube
less tires.
5. The subcommittee will ask
the State Department for a re-
port on whether excise tax ex-
emptions on foreign diplomats
In this country should be con-
tinued.
Tax Appeals Board
6. A six-me ember Appeals
Board should be established in
the Internal Revenue Service for
determination of excise tax dis
putes.
z. The Federal wagering tax
law should provide that an agent
or runner" for a professional
gambler can be held liable for
payment of the 10 per cent tax
II he refuses or is unable to
name his employer.
8. Stock transfer or issuance
taxes should be revised so that
the rate for issuances would be
10 cents on each 500 of the
actual value of the certificates,
5 cents on each $100 of the
value in cases of sales or ex-
changes, and no tax on transfers
which do not constitute sales
or exchanges for value.
9. Instead of the present tax
on leased wires. teletypewriters
and talking circuit special serv-
ices, a new tax should be i'm
posed on wire mileage" The
8 per cent tax on wire and equip
ment service should exclude
interior communication services.
especially fire alarm and burglar
alarm systems. Local telephone
service should be redef1ned so
as to exclude toll telephone mes
sages. All toll messages should
be included in a category called
toll telegraph messages" in
stead of long-distance telephone
messages.
Personal Income Tax
Meanwhile, Senator George,
Democrat of Georgia. said he
knows of no move to add a cut
in personal income taxes to the
House e-passed bill,