Kankakee Valley Post, Volume 19, Number 36, DeMotte, Jasper County, 5 August 1949 — Tax Refund Reform Upset By State Auditor [ARTICLE]

Tax Refund Reform Upset By State Auditor

Wins Back Patronage; ' Propst Denies Poli- ‘ tics "In Raid" On Revs enue Department Democratic State Auditor James M. Propst has won hack control of the state gasoline tax reJund section, one of six state levenue agencies consolidated under the State Department of Revenue in 1947. The action, disclosed yesterday by Auditor Propst and Governor Heniy F. Schricker, was regarded by many political observers as the opening wedge in a series of Democratic patronage raids on the revenue department. The department, which has saved Hoosier taxpayers millions of dollars by reducing the administjative cost of collecting state tax es, combined the store license, gross income, inheritance, intangibes, motor fuel and oil tax divisions. Propst, frequently mentioned as a possible Democartic nominee for governor in 1962, denied that he had demanded and won back the gas tax refund division for political reasons. Transferral of the division back to the auditor’s control, where it was before the Yevenue department was established, was OK'd at a July 26 meeting of the State Finance Board, Propst said. The finance board is posvd of Propst, Governor Scblieke rand State Treasurer Shirley Wilcox.”* 1 ” ‘‘Politics doesn’t enter into this thing at all,” Propst declared. “We thought gasoline tax refund ought to be back in our office since it is an auditing and not a revenue-collecting operation. It will eliminate duplicate auditing by the two departments.” The store license, gasoline tax lefund and oil tax divisions, a sizable chunk of patronage, all were yanked away from the auditor’s office and consolidated under the revenue department in an economy move in 1947. Since then the revenue department has 1 educed the cpst of collecting all State revenues to 1.6 per cent of the department’s total income. The administrative cost is much higher in other states. Ohio’s sales tax costs 12 per cent to administer. The levenue department also was indirectly an outgrowth of a feud between former Republican Governor Ralph F. Gates and fenner State Auditor A. V. Burch. Gates engineered legislation which took the tax-collecting divisions away from/Burch’s control because Burch advocated a direct primary law which> Gates opposed.