The Mason City Globe-Gazette from Mason City, Iowa on March 24, 1934 · Page 11
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March 24, 1934

The Mason City Globe-Gazette from Mason City, Iowa · Page 11

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Mason City, Iowa
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Saturday, March 24, 1934
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Page 11
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MARCH 24 1934 MASON CITY GLOBE-GAZETTE ELEVEN RETAIL SALES TAX EXPLAINED RULINGS ON NEW LAW OFFERED BY BOARD ARE MADE Questions and Answers Are Tentative Explanation, Foster States. FACES TRIAL FOR SEA SLAYING DES MOINES, March 24. The state board of assessment and review today issued a compilation of questions and answers on administration of the new retail sales tax. The rulings are tentative, J. W. Foster, board member, pointed out, and will be modified after trial if necessary. The questions and answers: What is tangible personal prop- terty? Tangible personal property means things that are movable and have substance and intrinsic value or worth. It includes such things as furniture, clothing, machinery, tools, 'equipment, livestock, vehicles of all .Icinds, jewelry, works of art, and in fact all property which is neither real property nor intangible personal property. What is intangible personal property? Intangible personal property consists of such things as book accounts, stocks, bonds, mortgages, notes and other evidences of debt. The same are not taxable under the Bales tax law. How soon are permits to do business required and does the state board furnish the blanks and instructions ? No permit is required before June 30,1934. Prior to that date the board will furnish a form upon which application can be made. Do not make applications before April 15, 1934. How shall remittances for the permit fee and taxes be paid? The law provides "That the same shall be paid to the board in the form of .remittance stamps payable to the treasurer of the state of Iowa." Do not send us stamps or money but send us draft or certi- ·i'jed check or money order, payable to the treasurer of the state of Iowa upon receipt of which, along with your application, permit will be sent to you. SALES If one dealer sells a car to another ,,, exchanges cars with another dealer, is such transaction subject to the sales tax? ' Yes, unless the seller in each case obtains a certificate of resale, indi- ^ating that the property is pur- ichased for resale. r"Frequently- a new car · delivered -Jby the factory requires substitu- vtioh of a new part. Is the cost of the new part supplied by the dealer taxable to the dealer? No. The replacement is a. part of the original sales price of the automobile and the cost of such part is not required to be included in the dealer's receipts. · Automobile salesmen buy cars to be used by them as demonstrators. ness tax on corporation, all ol which were enacted in the same bill It is a temporary law and will expire by limitation April 1. 1937. Where does the money from the sales tax go? 1st: Three per cent of it goes to the general state fund as collected. 2nd: The legislature made a three million dollar appropriation for "direct relief or work relief" to care for unemployed and needy persons: and during the year 1934 three million dollars of this sales tax are to be used to provide for this expense: otherwise this would have to be paid from property tax. 3rd: On Jan: 1, 1935, and quarterly thereafter, one million and a hall- is to be paid into the state treasury for the purpose of taking care of the general expense of the state government; which otherwise would have to be prvoided for by a property tax. 4th: The balance of said fund shall be distributed from time to time to the county treasurers of the several counties in the same proportion that the assessed valuation of property bears to the total tax- county treasurer in turn distributes couny treasurer in turn distributes the amount so received as follows: He enters a credit against the second installment of tax of each taxpayer based on the taxpayer's assessment. In the event the tax- oayer has paid both installments of his tax the county treasurer shall remit to such taxpayer the amount of his credit. The expense of the board in carrying out the provisions of this act is also to be paid from this fund. Andrew Klrwan, 23 (left), son of the former Jean Nash, "world's best dressed woman," is shown as he was escorted to federal court In New York. He faces trial on a charge of first degree murder for the slaying of GUliani Sessoms during an argument aboard the liner President Garfield at sea. (Associated Press Photo). Such cars are subsequently resold by the salesmen. Is the dealer required to report the sales of the cars to the salesmen? Yes. If the salesman subsequently sells the car he is also required to report the receipts from such sale. EXEMPTIONS AND NON-EXEMPTIONS Does the tax apply to sales of tangible personal property to the United States government? . .No. RECEIPTS How must a taxpayer report sales made on credit? The same should be reported as '"Gross Receipts" exactly as if it were sold for cash. If later on the account is found to be worthless and actually charged off for income tax uurposes, credit will be given on subsequent payment of sales tax provided however that, if such accounts are thereafter collected by the retailer, a tax shall be paid upon the amount so collected. How must a taxpayer' report receipts from sales under conditional contracts extending over a period the purchaser an additional amount representing the tax, it is believed the purchaser would not be under legal obligation to pay such additional amount. We recommend that the unit or total price be increased to cover the tax and the method of computing the tax be posted on a placard showing and stating that the tax is included in the sale price, and setting out the method used in arriving at same. REPAIR AND SERVICE CHARGES We rebuild and repair shoes. Is the seller required to report the total receipts from such repairing, or may the seller separate labor and materials and only report receipts representing sales of materials? Receipts from repairing shoes are not subject to the sales tax as the repairman is considered the final buyer or ultimate consumer of the material he uses. The seller of the materials to the shoe repairman is taxable on his receipts, PROFESSIONAL SERVICES, SALES Are the professional services of a pharmacist in compounding a .prescription to be included in taxable receipts of sale? The tax is imposed upon the privilege of selling tangible personal property to the final buyer or con- longer than 60 days ? Only such portion of the sales amount shall be accounted for as has actually been received in cash by the retailer during each quarterly period. If merchandise is sold to a consumer who finds a defect in the goods and obtained an allowance on the purchase price, may the seller deduct such allowance in reporting receipts from the sale? The seller may deduct from the total sales adjustments of the original selling price. · A dealer sells a new .car at the list price, which is $1,000. An allowance of $300 is made on the used car taken in trade, and ?700 is paid in cash. On what amount is the tax imposed ? On $1,000. The law defines receipts as the total selling price of the property, whether in cash, other property or credit extended. May the tax be added by the seller to the invoice as a separate item? A tax is imposed upon the seller for the privilege of selling tangible personal property at retail, and is computed upon the total amount of the sale price received by him. He should .increase his price sufficiently to cover the tax. Our law provides: "The retaiier shall, as far as practicable, add the tax, or the average equivalent thereof, to the sales price or charge and when added such tax shall constitute a part of such price or charge." Just how the seller shall render his bill or invoice is not specified in the law. In the state of New York has been held if he should sumer thereof, measured by the receipts of such sale. The law allows oo deduction on account of the cost of the property sold,' the cost of materials used, labor or service cost. No distinction is , drawn between professional and non-professional services. Mefficine compounded by a. pharmacist is tangible personal property, and the value of the professional service required may not be deducted from receipts of sale, as it is necessarily a lump sum sale obviously composed of material and sen-ice. AUCTIONEERS AND AGENTS Are auctioneers selling goods for other persons required to repor such sales for sales tax purposes? If the auctioneer is acting for an unknown or undisclosed principle such auctioneer is deemed the true owner thereof, and upon the sale 0! such property shall be subject to the tax. If, however, such auctioneer is acting for a known or disclosed principal the receipts from such sale shall be reported by the principal. Are automobile repair shops and garages subject to sales tax? The receipts from labor and services performed in connection with the repair work or installation are not subject to tax. But if parts are furnished and sold the amount received for them is subject to tax and a separate book account should be kept of the two items. HOTELS Hotels in making 'charges for rooms and other hotel service are not subject to tax, however, they shall pay a tax upon all foods and other tangible property sold to the insumer. PRINTERS AND LITHOGRAPHERS Job printers and lithographers are selling to the public tangible personal property consisting of stationery, advertising material, stock certificates, bond certificates, etc., and they are taxable upon all tangible personal property sold. LAUNDRIES, DRY CLEANERS RUG CLEANERS, AUTOMOBILE LAUNDRY All of the above named industries are rendering purely a service and are not selling tangible personal property and are not taxable. Are opticians and optometrists, physicians, dentists, architects, artists and veterinarians subject to tax? Their chief function is to render service for which they receive pay. The services are not taxable. But when members of the profession sell tangible personal property such as spectacles for use apart and distinct from the rendering of a ser- raake the sale for a certain price I -.-; oe , they are liable for tax on the und then attempt to collect from j gross receipts from such sales. A separate account should be made of the distinct items. Are barbers and beauty shop operators subject to the sales tax? These people are considered to render and receive compensation for services and they consume for use such tangible personal property as is incident to the rendering of such services, a.'l of which is not taxable, but if they sell cosmetics, hair tonics, lotions and like articles or any other tangible personal property, they will be taxable upon their gross receipts therefor. How do you tax undertakers and funeral directors? Their business is ordinarily a combination of selling service and commodities. Their tax is measured only by the gross receipts of sales of tangible personal property. In keeping their books they should separate the charge for services ana the charge for tangible personal property in'the MIT tendered to"their" customers. Are federal taxes deductible from the selling price in computing gross receipts of sales at retail? No. LIVESTOCK OR POULTRY FEED Are sales of livestock or poultry feed subject to the sales tax? The sale of feeds for use in feed- ng livestock or poultry for marketing purposes constitutes a sale for purposes of resale within the mean- .ng of the law, and gross receipts therefrom are not within the act. likewise the sale of feeds to dairymen or poultrymen for use in feed- .ng dairy cattle or in feeding poul- :ry which produces dairy products, or eggs for sale at market, is deemed to be a sale for purposes of resale within the meaning- of the act, :he receipts from which are riot taxable. But the sale of feeds to a purchaser for use in feeding livestock or poultry which is used, employed or consumed for purposes other than sale at market, constitutes s. sale at retail. In such case gross receipts of the seller from this source must be included in com- Charles CityNews Clark to Open Series of Meetings in Church CHARLES CITY, March 24.--The j first of a series of meetings by Dr. i Frederick J. Clark, son of Judge ' and Mrs. Clark of Mason City, will be held in the First Methodist church Sunday evening. Dr. Clark will use beautiful slides and appro- j priate music to supplement his mes-! sage. Sunday evening the theme will be "The Light of the World." Monday evening, "The Crisis and Crisis Religion;" Tuesday, "The Spirit of the Kingdom;" We'dnesday, "Prince of Peace;" Thursday, "The Challenge of the Cross," holy communion will also be celebrated at this service; Friday, "What Salvation Can the Church Offer Today?" Charles City Nursery Gets Federal Contract CHARLES CITY, March 24.--The Sherman Nursery company has just been awarded a contract by the United Forestry Service department to furnish 100,000 Norway spruce to be delivered early in April. These trees will be used for reforestation planting in accordance with President Roosevelt's tree planting program. CHARLES CITY BRIEFS puting the tax. Are hatcheries and baby chick producers taxable? Hatcheries or baby chick producers may sell their chicks to a purchaser, who, in turn, resells them -all as baby chicks or in various stages of development before maturity. In this case, they make sales for resale, receipts from which do not come within the act..If the baby chicks are sold to a purchaser, who does not buy them for resale, same are subject to sales tax. FINALLY Why do we have a sales tax and is it a permanent law? Property tax in Iowa is facing a break-down because the income and earnings, from every important class of property cannot bear it. You can scarcely afford to own real property, not even a home. Our conditions have been absolutely intolerable and something had to be done about it. The cost of government has multiplied out of all proportion to the.growth of American wealth. Taxes have increased nearlj 500 per cent and debts have been steadily piling up. Very few cities are balancing their budget. The question arose whether we should continue to go in debt or inaugurate a "pay as you go system." The requirements to meet public obligations-, even here in Iowa are already enormous and they must be provided for. It takes nearly 30 million annually to keep up the interest and sinking fund on our state and ocal indebtedness and this indebtedness is growing by leaps and bounds. Our tax bill has been substantially decreased but cannot be CHARLES CITY, March 21.--The members of the Lions' club were guests of the Gem theater through the courtesy of Jack Kuech Friday following their luncheon in the Legion rooms. The Charles City fire department , was called to the Hausberg- farm | four and one-half miles south of the city Thursday evening. A barn, quantity of small grain and one cow burned. The loss is estimated at about $2,500. Frank Johnson is the tenant. Walter Becker who lives two miles northwest of here lost a dozen head of cattle through the feeding of sweet clover poisoning in what is known as mow burn, the cattle being dehorned at the time. The warning to farmers is- to avoid dehorning operations when cattle become afflicted with this trouble. The Floyd county board of supervisors purchased a new road grader for $1,612. Eldon Irish is recovering- from a broken shoulder bone. On Wednesday he was in the woods putting out a fire started by a cigaret when a hollow tree struck him in falling. Mrs. Levi Brenner, a pastor's wife who lives in Milwaukee spoke at the Ladies' Aid meeting in the First M. E. church Thursday. She returned to her home yesterday after visiting her sister, Mrs. George Haughey, Several members of the Salvation Army of Mason City gave a special program "I Am at the Door" in the S. A. hall here last night. Weston Jones has gone to Cedar Rapids and Iowa City on business and will visit his mother, Mrs. C. R. Jones at Ames before returning home. Marian Johnson, soprano and Lucile Simpson, contralto, both tied for first place in the sub-district contest in Osage yesterday. Judge T. A. Beardmore went to Osage this morning to hold court. Refunding Bonds Sold by j Board of Floyd County j _ CHARLES CITY, March 2t--Pri- rauch further reduced" without i mary road ^funding bonds to the · i. . i . . "MM i*i, orvirnTnf r\f C1 !"!£· rrn/i _. _ ^ .· crippling the requirements of justified public service. If we are to maintain our present standard in chools and other public functions we must have more money or in- ^ur more indebdtdness. The sales ax is a part of the emergency law massed to replace the tax on prop- rty. It is a companion law to Hie. ,, ...,, , ...,,,,_ ,,, , jersonal net income tax and busi-1 --Wisconsin State Journal. amount of $106,500 were sold yesterday by the Floyd supervisors to , the Waterloo Savings bank. The I bonds, bearing 3 1 ,* per cent interest, ' were bid for by nine firms. Man has one advantage. He can let the phone ring- and ring without ' "lurthig his conscience or curiosity, i G L O B E - G A Z E T T E C L A S S I F I E D A D S R E A C H T H E M U L T I T U D E - you had a salesman... who could call on over 18 thousand families a day and with equal facility sell for you an automobile, a rug, a kitchen table, a gas range, a cow or a house, and - you had a buyer . . . . who could call on just as many people as your salesman and find anything you might want to buy, from a second hand automobile to a growing business; and then ~ you had a handy man . to run around and find someone to wash your windows, clean your yard, beat your rugs, or even find a job for you if you needed it; and if each of these workers cost you only a few cents per day --you'd think you were mighty well fixed, wouldn't you? Well sueh wlllin S workers ' are just waiting to help you in all these ways, and you'll be surprised at the remarkable service you get out of them. They are The Globe-Gazette's Classified Ads, and you can find out all about them by calling 3800. Try on e or two of them and be delightfully surprised. The cost is small as compared with the results. Mason City Globe-Gazette North Iowa's Largest Daily Paper {^

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