Kankakee Valley Post, Volume 17, Number 12, DeMotte, Jasper County, 7 February 1947 — CIGARETTE AND USE TAX WIN APPROVAL [ARTICLE]

CIGARETTE AND USE TAX WIN APPROVAL

sll Million Yield Seen In Levies; Three-Cents-A-Pack Proposed On Smokes The Republican legislative policy committee yesterday approved a 3-cents-a-packagc qigarette tax and a use tax to help take up the slacks between state revenue and proposed increased expenditures. The cigarette tax is expected to yield $9,000,000 a year; the use tax $2,000,000. State expenditures at a rate of $22,000,000 a year more than anticipated revenue—with out these two additional taxes —were proposed by the state budget commitee in its biennial report to Governor Ralph E. Gates yesterday. The committee’s recommendadid not take into consideration any increase in school teachers’ pay or passage of any of the special appropriation measures pending in the General Assembly. Over-all expenditures of $179,08G.512 for all purposes during the next two-year period were recommended by the budget committee. This figure compares with $92,398,706 appropriated two years ago, but the departments operating with special funds spent considerably more than the appropriated figures, according to budget officials. The cigarette tax revenue would be earmarked for education and health programs. The $11,000,000 new revenue would meet half the Under present sentiment of the policy committee, the remaining half would be met from withdrawals from the general fund balance, now $53,431,000. The use tax would be collected on goods manufactured outside Indiana and shipped into the state for sale. The tax would range from one-fourth of 1 per cent to 1 per cent and would apply to both wholesale and retail trans-actions. The bill provides for one-fourth of 1 per cent tax on wholesale transactions; one-half of 1 jper cent on retail sales from outside the state (such as mail order sales), and 1 per cent where personal property is acquired by purchase in any other manner. 4 The seller would be responsible for payment of the tax to the state. Governor Gates indicated that no other new tax would be recommended by the administration. The over-all expenditures proposed by the budget committee included both regular general fund expenditures and outlay by departments, such as the Highway Commission, which operate with money derived from special taxes. General fund outlays proposed would total $91,217,622 for the next two years, an increase of approximately 30 per cent over current expenditures. The largest single item in the general fund appropriations was $24,865,591 for operation of state departments, boards and commissions for the next two-year period. This is an increase of $9,500,000 over the outlay for the current biennium. For public welfare costs, the budget committee recommended an outlay of $22,014,000. an increase of $5,000,000. This increase was attributed to a return to the prewar level of the number of old age recipients. The bulk of this money is distributed to county welfare departments.