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THE MUSIC TRADE REVIEW
NEGATIVE VOTE IS URGED ON EXCISE TAX REFERENDUM
Music Industries Chamber of Commerce Sends Out Strong Plea for Negative Vote on Refer-
endum Submitted by U. S. Chamber of Commerce Relative to Excise Taxes on Certain Articles
Continuing its preliminary campaign to pre-
vent the imposition of unjust taxes upon the in-
dustry the Music Industries Chamber of Com-
merce this week sent to the Chambers of Com-
merce in every city in the country with a popula-
tion of 20,000 or more a strong letter urging a
negative vote on Proposition No. 3 of Referen-
dum No. 34 of the Chamber of Commerce of
the United States of America, which proposes
that "there should also be excise taxes upon
some articles of wide use but not of first neces-
sity."
Presidents of State and city trade associa-
tions everywhere are responding to the Cham-
ber's invitations to serve as chairmen of local
legislative committees to take up the tax fight
in their respective districts. Many of them al-
ready have sent in the names of other men who
will serve with them.
In its letter the Chamber asks for the oppor-
tunity of having a member of the industry ap-
pear before a committee of the Local Chamber
of Commerce at a hearing on the tax question
in order to present the case of the music indus-
try properly, and says:
"Unless and until such time as Congress may
finally decide upon a general sales or turnover
tax as a substitute for all taxes on business,
propositions relative to excise taxes will un-
doubtedly be numerous and pushed forward en-
ergetically by many interests. Even if a modi-
fied or limited form of sales tax is finally
adopted, other taxes will be necessary, of which
excise taxes will undoubtedly be proposed.
There have already been many proposals con-
cerning excise taxes, from important organiza-
tions, which appear after careful study, and
sometimes even at a glance, to have been of- •
fered without complete knowledge of the real
nature of excise taxes. We refer particularly
to the preliminary and final reports of the Tax
Committee of the National Industrial Confer-
ence Board and to the report of the Tax Com-
mittee of the Chamber of Commerce of the
United States. In this connection we would like
to point out that no member of either of the
above committees represents an industry sub-
ject to excise taxes or is likely to have a per-
sonal appreciation of the effects of the existing
discriminatory excise taxes."
Taxation During the War
Attention is called to the fact that during
the war a number of industries, including the
rrjusic industry, was subjected to special excise
taxes which were considered discriminatory
then and are certainly discriminatory now
when the emergency has passed. A con-
tinuance of such taxes, it is declared, will, in
the case of the music industry and others, serve
to bring about a serious business curtailment.
Continuing, the letter reads:
"We believe that Proposition No. 3 of referen-
dum of the Chamber of Commerce of the United
States and those sections of the report of the
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Tax Committee pertaining thereto are so
worded as to make impossible an intelligent
vote. As a matter of sound tax policy, excise
taxes should be imposed only upon certain types
of articles which we will describe later on in this
letter. The National Chamber's Tax Committee
does not clearly define what commodities are
properly subject to excise taxation, or which
ones they refer to, so that with a favorable
vote on Proposition No. 3 the National Chamber
could justify itself in advocating excise taxes
on almost any commodity, thus imposing a dis-
criminatory burden on many of your members,
and undoubtedly raising a veherment protest
from them.
Clearer Definitions Needed
"We have taken this matter up with the Na-
tional Chamber in the hope of obtaining a
clearer explanation of what excise taxes they
recommend, but are informed that no supple-
mentary report can be made and that the ex-
planation of the committee seems to be suf-
ficiently clear. The explanations to which they
refer are the two phrases that such taxes should
be imposed 'upon a few articles' and that 'taxes
of this kind will correspond to the excise taxes
with which the country is familiar, such as the
taxes upon tobacco and upon alcoholic bever-
ages.' We have pointed out that by'a few articles'
their committee might have in mind either a
limited number of articles as compared with
those now so taxed or several times the number
of industries so taxed. In case of the latter,
the tax would be on 'a few articles' as com-
pared with the number of kinds of articles pro-
duced. Also their -illustration of the kind of
taxes 'with which the country is familiar' men-
tions specifically excise taxes on tobacco and
alcoholic beverages, with which the country
was familiar prior to the war. However, they
might really mean excise taxes with which the
country has recently become familiar on ac-
count of the present wartime excise taxes. In
all fairness to the members of the National
Chamber, we believe that we should know
which of the following propositions we are
really voting for when we vote on Proposition
No. 3:
"1. That there be excise taxes, but that they
be limited in number as compared with those
now taxed, and confined in character to those
taxed before the war, or
"2. That there be an extension of excise
taxes upon a few articles as compared to the
number produced in the country, and that the
articles be similar to those now taxed by the
War Revenue Act.
"Inasmuch as the National Chamber feels
that it cannot supply further information so
, that its members can vote intelligently, we
urgently request your association to vote
against this proposition, or at least make clear
that you do not approve an extension of the
excise taxes or a continuance of the discrimina-
tory wartime excise taxes.
An Evident Inconsistency
"The National Industrial Conference Board's
report proposes to impose additional excise
taxes and increase to 10 per cent all excise
taxes under Sections 900, 905 and 906 of the
War Revenue Act of 1919. In this proposal the
committee is not at all consistent, because they
define clearly the type of commodity which is
properly subject to excise taxes and then pro-
ceed to recommend increased excise taxes on
commodities which do not conform to their
own definition.
"This report and our rather voluminous cor-
respondence with the National Industrial Con-
ference Board upon this subject illustrate
clearly our contention that it is impossible, as a
practical matter, to impose any extensive sys-
tem of excise taxes fairly. The Board's report
states that the question of whether the commodity
is a luxury has no bearing upon the question
of whether ij: is properly subject to excise taxes.
JANUARY 15,
1921
Nevertheless, in correspondence with us they
repeatedly speak of commodities which might
be taxed because they are luxuries or semi-
luxuries. It seems to be impossible for legisla-
tors or private citizens to get away from the
erroneous idea, which was developed during
wartime necessity, that special taxes should be
imposed upon luxuries and semi-luxuries, which
it is assumed the public can get along without.
From the standpoint of public policy it is wrong
for a government to discriminate between its
industries; and as shown during wartime, it is
impossible even then to determine what is a
luxury. In fact, no matter what the classifi-
cation may be, innumerable instances can be
shown of essentials which are used as luxuries
and of products which are commonly thought
of as luxuries which are used in absolutely es-
sential ways. No one familiar with our war-
time experience on the question of luxury versus
essential will agree that a fair and proper dis-
tinction can be made. Furthermore, in building
up a tax system on the supposition that the pub-
lic can do without certain industries, sound tax
principles are violated, because it is thus ad-
mitted that the tax is so imposed as to dry up
the source of taxation.
Passing the Tax Along
"The National Industrial Conference Roard
states that excise taxes should be imposed only
on such industries as can pass the tax on to the
consumer. We can prove by facts that such is
net the case with our industry, and undoubtedly
not with other industries similarly taxed. Such
mistakes are inevitable under any extensive
system of excise taxation, because, as a prac-
tical legislative matter, Congress will find that
it cannot confine such taxes to industries prop-
erly subject to them or impose them on all in-
dustries which should be so taxed. The net re-
'sult is that those industries which are influential
enough to escape such taxation are not taxed,
and the unfortunate ones assume the burden."
In closing, the letter calls attention to the
fact that the excess profit tax must be repealed,
it will not produce the estimated revenue; that
surtaxes must be lowered to a certain degree,
and that there arises, therefore, the question of
a suitable substitute. This substitute, it is em-
phasized, cannot be a tax placed upon only a
limited number of industries.
DEATH OF ALEXANDER BREMER
Secretary of International Music Festival
League and Prominent Figure in Musical
Circles Generally Passes Away in New York
Alexander Bremer, secretary and treasurer of
the International Music Festival League, died
last week at his home, 144 East Eigihty-sixth
street, New York City. Mr. Bremer was a well-
known figure in band and orchestra circles
throughout the United States for more than
thirty years. He was twelve times elected presi-
dent of the Musical Mutual Protective Union
and served as secretary of the Musical Exchange
for many years. He was also president of the
National League of Musicians of the United
States for several years.
Mr. Bremer was born in Copenhagen, Den-
mark, in 1850. He came to the United States in
1867, after having played before the royal
family of his native land, and he was a member
of the New York Press Club and Aschenbroedel
Verein.