Music Trade Review -- © mbsi.org, arcade-museum.com -- digitized with support from namm.org
THE
MUJIC TFADE
VOL. LXXII. No. 6
O
Published Every Saturday by Edward Lyman Bill, Inc., at 373 4th Ave., New York. Feb. 5, 1921
Single Copies 10 Cents
$2.00 Per Year
UT of the flood of conflicting and confusing suggestions relative to a revised War Revenue Act that will
combine simplicity with fairness, there is emerging a definite movement to report some sort of general
sales tax that will serve to bring in the necessary revenue, while at the same time equalizing the tax
burden on various industries and upon various classes of the public at large.
Even among those who favor a general sales tax, however, there is considerable difference of opinion as
to the form and general features of such a tax, and the efforts being made to have some such idea adopted by
the Government must of necessity be watched in order to prevent the putting over of any measure that, although
appearing" innocent on the surface, may have a joker or two in it that will revert to the disadvantage of certain
industries.
The legal committee of the Music Industries Chamber of Commerce has decided to recommend a limited
sales tax on commodities as a chief means of raising revenue, and as a method that will do away with discrimi-
natory excise taxes. If this recommendation meets with the favor of the Chamber directors, and with the leading
factors of-the trade, it will in all probability be officially confirmed and become the basis of the Chamber's argu-
ments in connection with the tax revision program.
Regarded more or less with suspicion at the outset, the general sales tax plan has been winning sup-
porters steadily and has received the endorsement of bankers and industrial organizations in large number. It
is also regarded favorably by many Government agencies charged with the collection of taxes in that it serves
to simplify the process and at the same time bring in a greater proportion of revenue.
The public has been called upon to pay millions of dollars in luxury taxes on medicines, haberdashery,
soft drinks and a hundred and one other items—taxes for which no receipt has been given, and which may or
may not be turned over to the Government, according to the honesty of the individual merchant. The cost of
collecting these taxes, the trouble involved and the uncertainty of the result have all served to discourage officials
who would welcome some plan where they could figure on a definite basis and with some chance of complete
success.
A general tax on gross sales—one-half of one per cent appears to be the figure most favored—would not
only simplify and lower the cost of the work of collection, but would provide figures that would enable col-
lectors to w r ork with some degree of accuracy. If a merchant did $10,000 worth of business in a month, for
instance, his own books would show that he owed the Government $50, and there the matter would end.
In endorsing and working for a general tax on gross sales care must necessarily be observed to prevent
the adoption of a so-called "turnover" tax, which might well be calculated to run the original one per cent up to
five or even 'six per cent on certain products before they reach the hands of the public. In the piano trade,
for instance, such a tax would mean that the Government would realize one per cent on the sale price of raw
material from the mine, or forest, another one per cent on the sale price of the finished material as it goes to
the supply house, yet another one per cent on the selling price of the assembled supply parts to the piano
manufacturers, and again one per cent upon the manufacturer's selling price to the dealer, with the retailer's
one per cent to top off the whole. This continual round of one per cent tax, when it finally reached the public,
would mean an aggregate in excess of a five per cent excise tax under which the trade suffers at present.
The Chamber of Commerce has, of course, recognized this danger and in its recommendations for a
tax on gross sales to replace present excise taxes has specified a limited sales tax. In other words, there is
such a thing as a sales tax becoming too general and resulting in the compounding of figures on a basis that
would gladden the heart of the father of interest tables.
If there is to be a general sales tax, let it be one tax, and applying only to the gross retail sales of every
commodity.