The Sidney herald., 1956-12-06

lem further. 1t is unfortunat
that now, when calm considera
ton of the problem is especial,
needed, j. F. Reid, chairman 0
the state board of equalization
should again raise as an issu
the tax refund granted on gaso
line used off the highways.
Mr.. Reid was quoted as sayinI
that the gasoline tax refund o.
drawback law is strictly un,
constitutional" He appears t,
lean on a rather technical legal,
istic Interpretation, but l doub
whether the supreme court would
sustain him. He contends - anc
perhaps in a narrow technica
sense correctly - that the Law
levying a gallonage tax on al
gasoline sold in Montana is no
a highway user tax but a tas
on the refiner or distributor, 6
license tax for the right to dc
business, but that the refund j:
not to the distributor but to the
consumer.
1t is true that the distributor
originally pays the tax, but Mr.
Reid admits that is passed On to
the ultimate purchaser. You and
/ when we drive up to a service
station pump are fully aware that
the tax, state and federal, is in
cluded in the price we pay.
Collecting the tax directly from
the distributor instead of from
the retailing service station or
tank wagon is the more feasible
and effect procedure, and that
apparently is why the law was
written that way. But when the
legislature in 1927 enacted the
gasoline tax law under which we
are now operating, this was clear
ly intended to be a means of fl
nancing construction and main
tenance of Montana's state high
way system. In intent, it was TO
be a highway user tax, regardless
of the mechanics of the law itself.
Because much of the diesel
fuel sold in the state does not
go into motors %propelling vehicles
or machinery on the public
roads, this tax is not being COL
lected at the source. This is
technically a highway user tax,
levied for exactly the same pur-
pose as the gasoline tax, but adj
ministratively the law has not
been satisfactory, particularly in
regard to evasion.
1t is entirely true that hand
ling gasoline tax refunds is a
considerable chore for the state
board of equalization. The board
as presently constituted is do
ing a good job in this respect,
especially in ferreting out CHS
lers. Anything that can be done
to force payment of the tax
where it is due is commendable.
There seems to be some ground
for the impression that what
Chairman Reid really prefers is
repeal of the refund law so that
the tax would be assessed on
all gasoline regardless of how it
is used. This ties in with the
theory that this is a license tax
to do business and not a high
way user tax.
Any threat to seek repeal or
drastic alteration of the gasoline
refund or drawback is sure to
generate violent political storm.
On such a question the farmers
hold the balance of power in the
legislature. Repeal of the law
has been suggested many times,
but l can recall no instance
where the attempt has been
made in the form of a bill.
Even the inference that the
gasoline tax refund may be as
sailed in the legislature or in the
courts would cause a highly dis
situation this winter
when the lawmakers undertake
10 work out the highway fl
nancing problem. Unless there is
,alm, fair and farsighted con-
;ideration of this problem, or if
he matter becomes involved in
political or partisan controversy,
he solution will be no solution
1t all, for then it will have its
genesis in bias, suspicion and class
interest instead of the general
interest.
The fact finding committee on
highways, streets and bridges,
reated by the 1855 legislature,
las made a report based on a
comprehensive study and will
ubmit its recommendations to
he legislature. The report covers
anticipated highway needs, the Z
tate's capacity to keep pace with !
he enlarged federal aid program
nd alternative proposals for fl !
!ancing Montana's participation :
4 this program. 1t would be I'M l
.rtunate if this got entangled
nth a dispute Over the gasoline :
rawback act. 9
At the recent election the vo- '
srs of Montana, by a margin of :
bout three to one, approved a :
institutional amendment to pre- ,
ent expenditure for non = high |
'ay purposes of money collect !,
i for using the highways, such /
S the motor fuel taxes. 1t is '
nown as the anti-diversion {
nendment. Twenty-seven states, :
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