FEEDBACK

Sales Taxes

September 20, 1943

Report Outline
Search for New Sources of War Revenue
Peacetime Experience with Sales Tax
Taxes on Sales in Time of War
Special Focus

Search for New Sources of War Revenue

Alternative Levies for the 1944 Revenue Act

A general retail sales tax stands in the background as Congress prepares to come to grips with the problem of finding additional revenue with which to finance the war. At an opportune moment it may be brought forward as a desirable alternative to increases in personal and corporation income taxes, forced savings, or other less satisfactory devices which would raise an equal amount of money for war purposes. The huge volume of transactions at retail in the United States, although already levied upon by many of the states, remains the largest single source of dependable revenue left open to the federal government.

Members of Congress reported, upon their return to Washington in mid-September after a ten-week recess, that their constituents had little complaint with the present burden of federal taxes but that there would be a “revolt of the home folks” if Congress tried at this time to impose the full $12 billion of additional levies called for by the administration. Contrary to expectations, most members of Congress found their people pleased with the withholding tax, placed in effect on July 1, but they reported definite disapproval of the present complicated system that “makes it impossible for a taxpayer to know where he stands.” Advocates of the sales tax point out that a levy on retail sales would impose no burden on the taxpayer, aside from payment of the tax; that the payments would be made in small amounts, “almost painlessly”; that the tax would yield as much additional revenue as Congress is willing to assess at this time; that it would do more to curb inflation than all other tax proposals combined.

Renewed Pressure for Federal Tax on Retail Sales

As the need for additional revenue has grown more press-ing with the rapid acceleration of war activities, proponents of the sales tax have gained in number and in voice while the opposition in Congress has tended to diminish. The general opinion is that if no acceptable alternative is developed during Ways and Means Committee hearings on the new tax bill, the sales tax may win by default.

ISSUE TRACKER for Related Reports
Taxation
Jun. 28, 2013  Internet Shopping
Jan. 16, 1998  IRS Reform
Mar. 22, 1996  Tax Reform
Apr. 06, 1990  How Fair Is the Nation's Tax Burden?
Aug. 28, 1987  Taxing Business Services
Oct. 17, 1986  Tax Reform In The States
Sep. 28, 1984  Tax Debate: 1984 Election and Beyond
Mar. 19, 1982  Tax-Exemption Controversy
May 19, 1978  Property Tax Relief
Apr. 07, 1978  Tax Shelters and Reform
Feb. 10, 1971  Property Tax Reform
Mar. 26, 1969  Tax Reform Pressures
Mar. 24, 1965  Excise Tax Cuts and the Economy
Feb. 15, 1961  Flexible Taxation
Apr. 02, 1959  State Tax Problems
Apr. 23, 1958  Tax Reduction, 1958
Aug. 14, 1957  Fast Tax Write-Offs
Apr. 10, 1957  Federal Payments in Lieu of Taxes
Sep. 12, 1956  Corporation Profits and Taxes in Prosperity
Mar. 16, 1954  Shares in Tax Relief
Nov. 21, 1953  Revision of Excise Taxes
Mar. 19, 1953  Federal-State Tax Relations
Oct. 01, 1952  European Taxes and Tax Evasion
Nov. 03, 1950  Excess Profits Tax
Feb. 01, 1950  Tax Loopholes
Jun. 04, 1949  Excise Taxes
Oct. 27, 1948  Postwar Sales Taxes
Aug. 29, 1947  Taxation of Family Income
Apr. 09, 1947  Income Tax Relief
Jan. 11, 1946  Taxation of Cooperatives
Oct. 16, 1945  Federal Taxes on Business
May 08, 1944  Postwar Taxes
Sep. 20, 1943  Sales Taxes
Dec. 05, 1941  New Taxes for Defense
Apr. 05, 1941  Taxation for National Defense
Feb. 28, 1941  Taxation of Alcoholic Beverages
Jan. 11, 1941  Exemptions from Taxation
Dec. 04, 1940  Federal Taxes and Defense Financing
Feb. 01, 1940  Sharing of Tax Revenues
Feb. 02, 1939  Turnover Taxes in the States
Nov. 05, 1937  Broadening of the Income-Tax Base
Jun. 17, 1937  Exemptions from Income Taxation
Apr. 05, 1937  Coordination of Federal and State Tax Systems
Dec. 19, 1936  Revision of Federal Tax on Capital Gains
Nov. 02, 1936  State Taxation of Natural Resources
May 26, 1936  Assessment of Property for Taxation
Apr. 17, 1936  Federal Taxes on Consumption
Mar. 19, 1936  Taxation of Undistributed Corporate Profits
Dec. 17, 1935  Reduction of Tax Burdens on Real Estate
Oct. 21, 1935  Tax Delinquency in the United States
May 21, 1935  Comparative Tax Burdens in America and Britain
Feb. 01, 1935  Federal Taxation of Corporations
Nov. 27, 1934  Elimination of Conflicts in Taxation
Jul. 25, 1933  Taxation of Excess Profits
Jan. 25, 1933  Tax Burdens and Tax-Free Securities
Nov. 23, 1932  The Beer Tax and the Sales Tax
Dec. 19, 1931  Sales Taxes: Federal, State, and Foreign
Sep. 18, 1931  Death Taxes and the Concentration of Wealth
Mar. 18, 1931  Federal Taxation of Large Incomes
Jan. 10, 1931  Taxation of Capital Gains
Nov. 09, 1929  Federal Tax Reduction-1930
Aug. 08, 1927  Federal Tax Reduction—1928
Sep. 27, 1926  Tax Reduction and the Public Debt
Jan. 16, 1926  Taxation of Estates and Inheritances
Nov. 07, 1925  Federal Taxation of Small Incomes
Nov. 28, 1924  Social, Fiscal and Legal Aspects of the Inheritance Tax
Apr. 07, 1924  Causes and Effects of the Tax Return Blockade
Dec. 12, 1923  Tax Exempt Securities
Dec. 10, 1923  Taxation
BROWSE RELATED TOPICS:
Sales Tax
FEEDBACK

Your Email Address

Subject

Provide Feedback

Suggest a topic here.

Type the characters you see below into the box

Take our survey to help us improve CQ Researcher!