Motion Picture News (Nov-Dec 1925)

2130 Motion Picture A e w s taxes can and should be removed. I do not want to suggest up to what amount taxes on admissions should be repealed because your Committee, in the last analysis, will have before you actual figures from the Treasury Department showing how much revenue woidd be lost to the Government in exemptions of 50 cents to $1.00, $1.00 to $1.50 and +1.50 to $2.00 and so on up. I firmly believe that this tax, which hits the great mass of the American Public from one to four times a week, should be repealed in its entirety. However, if this can not be done, this great burden should be lifted as much as possible in view of existing conditions in the Treasm-y." The effect of the tax is felt at the box office of the theatre in many ways, according to Mr. Brylawski. He stated he appeared before the Committee here as Executive Chairman of the motion picture theatre owners of America and representing them in their appeal to this Committee and to Congress for the repeal on the present tax on theatre admissions. "This tax was called from its very inception a 'War Tax' and as a 'War Tax' it still remains in the minds of the Public although we have been most careful to eliminate the words 'war' from our tickets and price lists," he said. "Now the first point that I wish to bring out in my statement which I can assure you will be very brief, is the resentment of the public to Thi> tax — truly one of the so called 'nuisance taxes'. No body of men on earth are closer to the public than the theatre men — our box offices are a medium of contact sensitive in the extreme to every fluctuation of public taste and sentiment. This contact is a necessary, vital part of our business, without it we can not exist for in the amusement field 'The Public must be served' — so therefore I think we are well qualified to testify to the strenuous, unfavorable reaction that this tax has and is causing throughout the country. It is a burden that draws resentment from the purchaser of the ticket and a patron that feels resentment at the Box Office is not a good audience for us. So strong has this feeling been apparent that in many sections of the country theatre owners have taken what to them is the wiser course and have at their own expense absorbed the tax. This however is something that but few theatres can afford and so it has been worked out to the detriment of the average theatre whose earnings do not permit of this additional burden. But in the vast majority of cases the tax is passed on to the public as was intended and the public do not like it. "Amusements today are as much a part of the life of a community as any other primary necessity. They are a necessity, not a luxury and are of the greatest value to the health, happiness and morale of the people. Like everything else, the cost of amusement is constantly advancing — I mean primarily the cost of production, actors, stage hands, musicians, stories, material, reach a new level each year. The «-ost of films, acts, plays are constantly on an upward trend. You will say that we pass these things on to the public and of course that is sometimes possible, but I call your attention to the constant level of theatre prices in the last three years. Theatre owners can not raise or lower prices at will — they are normally constant. The bureau of statistics of our organization whose duty it is to collect this data reports that the average price of theatre admissions throughout the country has advanced but per cent since 1922, this, despite vastly greater increased costs. The fact of the matter is that theatre admissions have reached a "high" that does not admit of profitable advance. By that I mean that a higher admission charge will not bring increased revenue at the box office, as the falling off in the number of admissions is directly relative to the increase in price. Of course I am not speaking of occasional, exceptional attractions, but of conditions everywhere on a general average. "The only answer to increased cost of shows today with us is increased capacity — not higher prices but more admissions. This is the natural law that is building the great large capacity theatres of to day — with their appeal of bigger shows for the same money. But the great number of theatres throughout the country built in normal times and with relatively small capacities feel the burden of this tax keenly. To them the increased cost of the ticket by reason of this tax cuts down the number of admissions and the revenues. To the public the removal of this tax means lower theatre prices — to the theatre owner it means larger theatre audiences and I am sure gentlemen that if you can see your way to remove this burden from off our shoulders, we will all thank you from the bottom of our hearts." The value of motion pictures as an educational medium was stressed by M. J. OToole, of Scranton, Pa., who spoke on the motion picture as the screen pi'ess, contendin°; that the theatres should no more be assessed with an admission tax than the newspapers of the country should be taxed with a special levy. Mr. O'Toole referred to letters which he had received from the Secretaries of the Treasury, Agriculture and War and the Postmaster General setting forth what motion pictures have been doing to aid the government in its various activities. He referred also to statements made by President Coolidge as to the great value of the screen. He was unaware of the fact that although Secretary Mellon and Undersecretary Winston had spoken most highly of the value of the motion picture screen, the former expressed his opposition to the repeal of the tax on the occasion of his opening address to the Ways and Means Committee. His brief remarks on the subject were read for the benefit of the Committee and the theatre men by Representative Garner. "Admissions and dues brought in $31,000,000 last vear, and are estimated to bring in $33,000,000 this year," said Mr. Mellon. "The tax applies only to admissions sold in excess of 50 cents. It does not seem that this tax is any particular burden and in the interests of the revenue it produces it ought to be retained." Mr. O'Toole stated he was not aware that Mr. Mellon had changed his opinion expressed last year that the admission taxes should be repealed, but after discussing the matter briefly with Mr. Garner he expressed the thought that the Mellon suggestion does not necessarily bind the Committee and his point seemed well taken tor it iimused the Committee members. The witness was asked by Representative Crowther, of New York, as to whether or not the "legitimate" theatre interests were satisfied with the existing tax inasmuch as there seemed to be no one present to represent them, but Mr. O'Toole stated he was without information on that score and that he would like to confine himself to the sub !'i.,;.im.»m iir.iii' iiiHiM!'iiii:!iinii!;iiii:iiirni!!m: i v. K im A. J. Kleist, New Preside n t of Motion Picture Theatre Owners of Michigan -.'iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiimiiiiiiiiiiii ■lTTTTiiflimuiiimniHntrtr ject of motion pictures and popular priced vaudeville. Representative Kearns, of Ohio, wanted to know how much actually was paid the actors and actresses in the movies, intimatin that if the salaries were lowered, the films would not cost so much and the troubles of the exhibitors would be lessened. Mr. O'Toole stated he would like to know the true figures himself, whereupon Mr. Connolly interposing, General Counsel Pettijohn was called into the argument. Mr. Pettijohn assured the committee that the stars were not paid one-fifth or onetenth of what the public was led to believe they received. He declared he never knew of one getting more than $2,500 a week. "It is all publicity," he declared. "If I had my way, the publicity men who send out these wild statements of actors* and actresses' salaries would be sent down here to appear before your Committees of Congress. I believe those press statements are the most damaging things possible to the business." Receiver Appointed For S. J. Gregory Upon application of four Hammond banks and William Kleighe acting personally and as president of the Hammond Amusement Company, S. J. Gregory Theatrical company and the East Chicago Amusement company, a receiver was appointed for S. J. Gregory. Receiver Chas. L. Sui'prise, it is understood, has taken charge of Mr. Gregory's real estate, bank accounts, leases, etc. It was also claimed by Mr. Kleighe that there had been an overcharge of one hundred thousand dollars more than actually spent in the construction of the Parthenon theatre in Hammond. Mr. Gregory has been a very prominent theatre man, having organized the Hammond Amusement, S. J. Gregory Theatrical and the East Chicago Amusement companies, which own and operate the Parthenon, Deluxe and Orpheum theatres in Hammond and the Forsythe and Lyric theatres in East Chicago. Other theatres in which Mr. Gregory is interested include the Parthenon, Berwyn ; Lagrange at Lagrange, and the Crown point at Crown Point, Indiana, the latter three theatres not being involved in the present receivership action. The application for receivership came shortly following a directors' meeting of the three companies operating the Hammond and East Chicago theatres in which Mr. Gregory was deposed as president and director and William Kleighe. who owns the majority of the stock in the companies, elected to fill his place. It is also understood that at this time Mr. Gregory was forced to return all stock which he held in these companies.