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September 24, 1932
TO DISCUSS TAX RULING
A court test of the recent ruling of the Bureau of Internal Revenue hold¬ ing that broadcasting stations were liable for a tax of three per cent on electrical power consumption will probably follow a conference to be held in ’.IFashington next week among members of the NAB tax committee. S. M. Elkin, chairman of the Committee, has called the conference for the purpose of deter¬ mining which of several courses of action shall be followed by the Association.
The ruling was announced by the Bureau following a number of conferences between I.Ir. Elkin and Bureau officials during which Mr. Elkin protested that the Reveime Act of 1932 did not contemplate taxing of power used by broadcast¬ ing stations. The Bureau had specifically exempted radio communication com¬ panies from the tax and broadcasting companies were entitled to a similar classification, it was argued. Following the conferences, the NAB filed a brief, setting forth arguments against the proposed ruling. The ruling of the Bureau had been promulgated shortly after the passage of the law but was suspended to give the NAB an opportunity to show why it should not be promul¬ gated. The adverse ruling was rendered two weeks ago.
LIBEL INSURANCE OFFERED
The Employers Reinsurance Corporation, Kansas City, Mo. has announced that it has available to broadcasting stations forms of policies insuring against civil liability for radio libel and slander. The insurance company has prepared a pamphlet entitled "Radio Libel and Slander" which discusses generally the basic law of defamation of character as it relates to radio.
TREND TOWARD RADIO ADVERTISING
Radio is growing in importance as an advertising medium throughout the v^orld, it is revealed in "Radio Markets of the World 1932", the sixth of a series of publications issued by the Bureau of Foreign and Domestic Commerce.
The publication contains an able discussion of the various broadcasting systems now in operation throughout the world and was prepared by Lav/rence D. Batson, chief of the Electrical Equipment Division of the Department of Com¬ merce .
"Radio has continued to grow in importance as a medium for advertising,"
Mr. Batson writes. "Most countries now have some advertising by radio, whether other means of radio support are provided or not. That it is effective is evidenced by its popularity with advertisers and by the fact that the per capita development of broadcasting facilities in each country is, in general, in direct ratio to the freedom of broadcasters to undertake advertising. "Methods vary considerably by countries, for several reasons. Sales promotion of any type must be adjusted to national characteristics, but in radio there is the added effect of legislation and regula-tion dealing v/ith publicity. Limitations as to time consumed, the ntunber of words, or the character of the advertisement are common. In Germany only German firms can use radio for this purpose. Spain limits publicity to five minutes of each hour, and the proposed national Canadian chain will use only 5 cent of the program time — three minutes during each hour." (Copies of the publication may be obtained from the Superintendent of Documents, Washintgon, D. C. at ten cents per copy.