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8/29/41
He explained that only a portion of the Coinmission ’ s tiine was taken up tiTT radio, and mentioned the telephone people as those v;ho should carry a'^ccnsiderahle portion of the burden. Zir.Fly said it might be diffi¬ cult to loiow how much to charge for a radio station franchise but that this might better be on a basis of coverage rather than power. Senator Bailey remarked that the broadcasting industry "enjoying the franchise riven to it to operate in the public domain should be v/illing to pay well for it," llr. Fly said he thought that might be true,
EJ-lsworth C, Alvord, tax: expert, speaking in behalf of the National Association of Broadcasters, suggested if the government is to embark on a policy of making industries pay for their own regula¬ tion that radio should be one of the first industries picked out for the experiment, hentioning railroads and some others, he said radio should really be the last. It is almost certain that the broadcasting industry will take this as its cue and put up t he hardest kind of a fight to keep from being an initial group for such an action.
Unquestionably the big factors in the defeat of the proposal bO tax broadcast time were (a) that it would h_ave set a precedent in the taxing of advertising, inasmuch as a broadcast station revenue is derived from the sale of advertising, and (b) that it v;ould have been tax on gross income wliicli it was argued v/ould have caused a deteriora¬ tion in the quality of the service the radio stations are nov/ giving.
Just how soon the Senate subcommittee and the Treasury De¬ partment, and as indicated above, tte Federal Communications Coiimilssion :aay agree upon recommendations to the Senate Finance Comraittee with regard to a franchise tax is not known. Senator George remarked if the time were too short for the question of a radio broadcast tax to be considered in the pending bill, it would corae up with a later revenue measure,
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A, F, OF L, LEGISIFJTIVL CHAIRIIAW OPPOSED BROADCAST TAX
With the Senate Finance Committee dropping the proposed tax on broadcasting stations from the defense revenue bill attention is called to the fact that though the tax v/as advocated by John B, Haggerty, President of the Allied Printing Trades Association, whose organizations are affiliated with the American Federation of Labor, it was strongly opposed by another representative of the American Federation, W, C, Hushing, Cliairmn of the Legislative Committee of the A. F, of L,
Testifying before the Senate Committee, I.Ir, Hushing said;
"The American Federation of Labor, Executive Committee, in its meeting at Chicago this month, adopted the following motion;
"While labor believes that the United States Government
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