The sun. [volume] (Newberry, S.C.) 1937-1972, March 22, 1940, Image 4
PAGE FOUR
THE NEWBERRY SUN
FRIDAY. MARCH 22. 1940
1218 College Street
Newberry, S. C.
O. F. ARMFIELD
Eflitor and Publisher
One Year ..
. $1.00
Published Every Friday
Entered as second-class matter December 6, 1937, at
the post office at Newberry, South Carolina, under the
Act of March 3. 1879.
SPECTATOR’S REFLECTIONS
Many progressive citizens are ad
vocating the repeal of the tax on In
tangibles. Senator Means of Charles
ton and Chairman Calhoun Thomas
are sponsoring bills to repeal.
I will concede that we have the best
law on Intangibles that I know of.
No one need make the point that
our law is less burdensome than that
of Viiginia or other states; I concede
that; but the very first purpose of a
tax is to produce revenue. Of course
there are taxes for regulation, such
as our liquor taxes; but the tax on
intangibles was imposed for the pur
pose of raising money for the State
That tax was $278,000 last year—less
than a one-mill tax on property would
produce.
This tax was imposed in 1933, when
our law-makers responded so mag
nificently to the calls for relief by
cutting the State apropriation fifty
per cent. It was argued that real
estate was overburdened with taxes
and that there was a large field for
revenue that had not been explored.
Those of us who advocate the repeal
of this statute are moved by the as
surance of men of the highest charac
ter and the widest experience that
the tax on intangibles defeats the
purpose of the General Assembly,
since it keeps out many wealthy men
whose taxes, if paid to this State,
would produce more revenue than the
present law brings in. To that ex
tent, the matter of repeal is a ques
tion of simple arithmetic. Can we
produce more revenue by repealing
the statute than by retaining it?
That is the question. I submit that
in that question hangs the whole
matter.
What are the intangibles? Moneys,
credits, bank deposits, corporate
stocks and bonds.
The General Assembly has amend
ed the original statute so that an in
come from intangibles of less than
$500 shall not be taxed separately.
Recently in a public meeting fi
gures were given to show how the
tax operates: One man in Spartan
burg paid $108 on a salary of $6,000
a year, but a lady in that county
with an income of $3,000 from stocks
had to pay $186. The lady paid $78
more than the man on one half the
income.
The tax works like this. A wi
dow operating a farm with a net in
come of one thousand dollars would
pay no income tax, but a widow with
an income of $1,000 from bonds,
mortgages, or dividends would pay
the intangibles tax on $500 of her
income. Another case. If a widow
operates a farm and realizes a net
profit from the farm of two thousand
dollars but loses two mules, two
cows, and a tenant house she could
escape the income tax; bat the other
widow, with income from mortgages
of two thousand dollars, would have
to pav the intangibles tax on $1,500
even if the world came to an end, for
the exemption of $500 is all that you
can deduct, regardless of other losses.
It was argued that the tax on in
tangibles would relieve real estate
of some taxes. If, however, the re
moval of the tax would bring in more
revenue, that argument fails. As a
matter of fact, since the tax was le
vied, other new taxes have been im
posed and thev are producing about
two million dollars.
It is argued by some that the tax
on intangibles is a double tax. We
have been led up to so many moun
tain peaks by experts who live in the
clouds that we as typical business
men, farmers and lawyers must try
to reason this out together. I am en
gaged in fanning and produce wheat.
Sffme of my neighbors also sow
wheat. We have no flour mill within
twenty miles of us. Suppose twenty
of us should form a little association
a little private business company, to
operate a flour mill. The only taxes
the mill would pay would be the
property tax to the county and school
district. If that private mill should
pay $2,000 to each one of us (I sub
mit that’s fantastic) each one would
add it to his income and set off all
his losses from his combined income.
But suppose that we, being afraid of
punitive damage suits, should take
out a charter from our Secretary of
State—the same men, the same am-
mount of money, the same business,
and making the same profit—what
would be the difference? Leaving out
the fees for incorporating, and con
sidering only operations, here are
the taxes on that little community
mill:
1. State Capital Stock Tax, 3
mills.
State income tax, 4 1-2 per cent
on all net profit.
3. County Property tax.
4. School district tax.
5. Federal Capital stock tax.
6. Federal income tax, 14 per cent
Here are four taxes, heavy ones,
too, that the private association would
not have to pay, but which the little
chartered company of Silver Street
would pay.
In the first case, if each of the 20
men received $2,000 profit, that indi
cates that t e company had a net
profit of 840,000. In the second
case, before the company could pay
anything to the partners, or stock
holders, as we call them, it would
pay to the State: 3 mills on its cap
ital stock, 4 1-2 per cent of the net
profits, a Federal Capital stock tax,
and 14 percent for Federal profits tax.
The partners (or stockholders) would
receive what was left. Clearly it
would not be $2000 as in the first
case. Would you not say that the
profit, or dividend, in the second
case had already beer taxed? And
taxed far more than in the case of
any group operating without a char
ter. •
But we haven’t finished with the
little group which asked our Secre
tary of State for a charter. In the
first case each man received $2,000
as a profit and could offset his losses;
but in the little company of Silver
Street or Fort Mill, each partner
(now called a stockholder) is allow
ed by the State an exemption from
the intangibles of $500 and must pay
4 per cent on the rest of his profit,
even though he lost ten thousand
dollars in his other businesses!
Now we, as average men of affairs,
looking at this clearly, can say that
the tax on intangibles is not a dou-
i ble tax ? Perhaps it isn’t ; if you
figure it out, it may amount to four
taxes!
There is an idea that the tax on
intangibles draws revenue from rich
people. The effort fails because
some of our people have become citi
zens of Florida in order to escape
the tax, and those from the outside
won’t come as citizens, because of
the tax.
As I wish this exposition to be one
to convince practical men, not theor
ists or philosophers, I am dealing in
practical illustrations to prove my
contentions. It has been pointed out
that before the enactment of this
statute in 1933 the millionaires did
not overrun the State begging to be
accepted as citizens. That is true.
Nor, indeed, do I see them standing
with hat in hand begging for citizen
ship today; but there is something to
be said by way of answering such
observations. Since 1933 a great
NOTICE OF ELECTION OF TRUS
TEES FOR RIDGE SPRING SCHOOL
SCHOOL DISTRICT NO. 40
A petition having been filed with
the County Board of Education >by
the patrons and resident taxpoayers
of Ridge Spring (Old Town) School
District No. 40, for the election of a
trustee from Ridge Spring (Old
Town) School District, pursuant to
the terms of a recent act of the leg
islature, it is ordered that an election
of a trustee be held in Ridge Spring
(Old Town) School District, at J. J.
Dominick’s store, on the 30th day of
March, 1940, from 8 o’clock in the
forenoon, until 4 o’clock in the af
ternoon, by managers hereafter to be
appointed by the County Board of
Education. The patrons and resident
taxpayeis are entitled to vote. Each
voter will cast a ballot on which is
written or printed his choice of trus
tee. The County Board of Education
will declare the result, and will ap
point the person as trustee who has
received the majority of the votes at
the election. The trustee must be
elected from the qualified voters and
taxpayers residing hi the School
district.
COUNTY BOARD OF EDU
CATION NEWBERRY COUNTY.
March 15-22
‘OtnJS ©3(3s)SSs) 0 ® 00 Facts That Concern You
No. 16 of a
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Rising of The Sap Stirs Pen of Hop Franklin
They say when kids start writing
on sidewalks and ball players start
south then Spring is here.
Another season soon gets under
way and the boys in the street start
predicting who will win and why so
this bird goes on a limb once a year.
In the American I-eague there are
the Yankees and seven other teams,
so it’s useless to try to pick any one
change has come about. Prophets of
a new era have risen in the land and
every sort of theory has had its
proponents, from California to New
York. Taxes have been enormously
increased, in some states arousing
the citizens to mass demonstrations,
as in New York, even New York. Men
of wealth find us more conservative
because we are almost pure Ameri
can stock, and almost untainted with
the socialistic impulse which seems
so powerful today. Some of these
men are becoming citizens of other
states, notably Florida.
I call to your attention that, quite
apart from any possibility of winning
new-comers, we have already among
us at least two hundred multi-million
aires owning fine estates here and
living here during the winter. Par
ticularly is this true of Aiken, Cam
den and a coastal territory from
Georgetown to Beaufort. Charles
ton had three hundred thousand tour
ists there last winter, some of whom
stayed for weeks, but I am not think
ing of them; rather I have in mind
men who come here for the winter
and live here in their own homes.
These gentlemen have come herc and
invested heavily for ease, comfort, cli
mate and happiness. Many of them
have expressed a wish to become cit
izens of this state, What keeps them
out? I need not multiply the cases;
several may be given as typical: A
man owning a splendid estate on
which he has spent a half million
dollars, had his accountant to compute
what his taxes are to the State of
New York, and what they would be
in our State. The accountant told
him that citizenship in South Caro
lina would cost him forty thousand
dollars a year more than his citizen
ship in New York. This was because
of onr tax on intangibles.
ahead of the McCarthy Maulers.
Boston Red Sox are certain second
pitchers and will probably give the
Yanks a race until August.
Detroit there is a ball club that if
they can get pitching with Greenberg
and York bombarding fences they
may upset the dope but it’s a long
shot.
Cleveland with Bob Feller and
Johnny Allen both going good are
sure of a first division place.
Chicago once great in American
League races, has too much of a team
going nowhere in particular to finish
any higher.
Philadelphia—we still pull for Con
nie Mack to win, but that won’t hap
pen for years yet; he can move up a
peg or so this year.
Washington fast moving back to
the early day when they were the
first in war, first in peace, and last
in the American League.
St. Louis—Well, they can’t finish
any lower. There aren’t but 8 teams
in the League.
National
It would take Houdini and forty
aides to stand pat on what may hap
pen in the National Lea,gue, but I’ll
take a shot on the outcome with fin
gers crossed and my eyes shut.
There is Cincinatti—they won last
year with Chicago and St. Louis cut
ting each others’ throats.
But my dough if I had any would
ride the Gas House Gang from St.
Louis this season.
Chicago they say the Cubs are giv
en too much do as you please bossing
but they still look good for second
place. The Reds fit in third place
simply because they are the third
best team in the National League and
I know they have Walters, Lombardi,
McCormick and the rest.
Brooklyn—well the Dodgers are
moving from so-so to just a shade
better, but other teams ain’t what
they should be.
Pittsburg and the Pirates to head
the first division and fight like every
thing to keep the Giants off their
backs because Bill Terry hasn’t what
he once had and they are getting
worse each season.
Boston — the Bean Eaters may
(Continued on page 5)
Notice to Farmers
We will Deiint Cotton Seed on the following dates:
Thursday, March 21st.
Friday, March 22nd.
Thursday, March 28th.
Friday, March 29th.
FARMERS OIL MILL
IMPORTANT
Notice!
All those who owe back taxes for the year 1937
and prior to that date, are asked to call at my
office at the court house at once. I have instruc
tions from the Comptroller General with regard
to these taxes and I must carry out his orders.
1938 Taxes
f
Back taxes for the year 1938 are also now in my
hands, and I earnestly request those who owe
these taxes to call and pay up. Levying on these
taxes will start soon resulting in considerable ad
ditional cost which will have to be added to your
taxes.
Those with 1937 taxes and any back of that year
will please not ignore this notice. I do not wjsh
to cause you any embarassment, but I cannot do
otherwise than carry out the law and the final in
structions I have from the Comptroller General.
C. W. Sanders,
COUNTY TAX COLLECTOR
DATED MARCH 27, 1940
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