Evening star., 1962-12-24

words, they could contribute up
to is per cent to the cause and
get a tax deduction.
More important, the manu-
facturers could deduct not their
cost of producing the goods but
the fair market value at whole
sale under 1866 court decisions.
The recipient of the gift, Of
course, had to be a tax-exempt
organization, but Internal Rev.
enue had long since settled
that. The Cuban Families Com
mittee had that tax-exempt
ruling.
December 1 - Treasury and
Justice men worked all day on
calculating the amounts in
volved under this possibility.
That night, Saturday, Mr..
Oberdorfer was host at a din
ner. One Of the guests was Lloyd
Cutler, attorney for the Phar-
maceutical Manufacturers AS
sociation.
Mr.. Oberdorfer took his guest
aside and outlined the problem.
Castro was demanding drugs
and there was no money to buy
them. 1t had occurred to some
tax people that the drug man.
ufacturers might want to par
ticipate in this humanitarian
effort-particularly at the end
OF the year when they might be
interested in a tax deduction.
Mr.. Cutler said 1t might be fea-
sible and made an appointment
for the following Monday to
talk about it.
Tax Experts Rule
December 2 The tax ex-
perts who had spent the week
end going over the tax angles
told the Attorney General that.
under existing law, it was per-
fectly legitimate for the manu-
facturerS to contribute their
goods and get a deduction based
on what they would have re-
ceived If they had sold the
product.
That afternoon, the Pharma-
ceutical Manufacturers Associ-
alton attorneys met with JUS
tice officials, Mitchell Rogovin,
attorney advisor to the Com
missioner Of Internal Revenue,
and Mr.. Hurwitch of State.
The PIMA attorneys agreed
with the legal Interpretation
worked out by the Government
tax experts, suggested that Mr..
Donovan appear before the
PIMA board at its December IL
meeting but asked for a meet
ing of the PIMA president and
board chairman with someone
of cabinet rank.
They explained that the drug
manufacturers had to be as
sured that their contributions
would not be inconsistent with
American foreign policy. At
this point, there had been no
public announcement of any
thing but hostility toward Cuba
since the missile crisis.
They said the individual
companies would need tax rul-
ings on the allowable deduc-
tions. They we're aware this Or
dinarily took from one to three
months. Could it be done over
night?
Antitrust Angle
And finally, after they looked
at the telephone book-size list,
they said the home-by-Christ-
mas idea would never work un-
less they could divide up the
list among the manufacturers.
They pointed out that, if the
manufacturers started consult
ing each other on prices and
inventory, they might expose
n mselves to antitrust
charges. They wanted a ruling
on that, too.
December 3- Internal Reye-
nue. assigned team to answer
tax questions for the manufac-
turerS on a 24-hour basis. IRIS
officials met with PIMA attor-
neys to try to isolate the tax
problems.
December 4 - Mr.. Donovan
came to town and reported
what he had done. He had been
talking with drug companies
and a milk firm. He told the
Justice officials what kind of
rulings the companies would
need before they were willing
to go ahead.
december 5 - Mr.. Katzen-
bach and Mr.. Oberdorfer, rep
resenting the Government, and
Mr.. Donovan, representing the
Cuoans. paid a call on the
American Red Cross.
1t was obvious by now that
some organization was needed
to receive the contributed
goods and get it shipped to the
Miami area. 1t needed an ex-
pertise in disaster work to be
found no place else.
Red Cross Checks
Up to now, the Red Cross had
stayed out of 1t on the ground
that 1t could not get involved
IN what appeared to be a DO
litical matter. But the project
had taken on a humanitarian
cast. Through the Cuban Red
Cross. officials here had some
idea of prisoner conditions
Then. too, the project pre-
sented an opportunity to help
the Cuban people with needed
food and medicine. The Red
Cross promised an answer
within "a hours.
December 6-Red Cross off,
cials checked with the Depart
FNnNNt ~