The Exhibitor (1961)

MPAA Exec Urges Uniform Tax Code Tells House Unit-Income In Interstate Activity Subject To Double Levy Under Existing Confusion WASHINGTON, D.C. — In a statement de¬ livered to the House Special Subcommittee on State Taxation of Interstate Commerce, Herbert J. Erlanger, secretary, MPAA tax committee, said it was urgent that a uniform definition of taxable income and its appor¬ tionment among states be adopted to ease the taxation burdens on businesses engaged in interstate transactions. Pointing out the inequity in the present system of interstate taxation, Erlanger said that “under existing variances in apportion¬ ment rules, state income taxes apply to more than 100 percent of the income of the corpo¬ ration.” “The basic reason for this,” he continued, “is that no uniform definition is used by all states of ‘income’ attributable to a particular state.” Continuing with his statement, Erlanger said that “the clearest example of a state tax¬ ing income not attributable to it occurs where the taxpayer is required to include in the computation that income which is derived from foreign countries. Such income obvious¬ ly bears no relation to any particular state, with the possible exception of the state in which the head office of the corporation is located. “In many states where our member com¬ panies have branch offices, the apportionment rules require that not only intrastate income but also some interstate income must be in¬ cluded. Obviously, to include 100 percent of the interstate income gives rise to multiple taxation. Even where a lesser percentage is required to be included, it is possible that greater than 100 percent of the income of that branch is subject to taxation in the states in which it operates. Were each state precluded from requiring the inclusion of more than 50 percent of the interstate business, no income would be taxed more than once. The same result would follow if the receiving state were only permitted to require the inclusion of 25 percent of the interstate business and the shipping state permitted to require the inclusion of 75 percent of the interstate busi¬ ness. At present there is no uniform standard in this area. “The identical problem arises in the case of rentals to television, where the program is broadcast to an interstate market. The ‘sending’ state may consider the entire in¬ come as apportionable to it since the pro¬ gram originates there, whereas the ‘receiv¬ ing’ state may consider part of the income as apportionable to it since a portion of the viewers reside there. Thus, more than 100 per cent of the income is potentially taxable. “Turning to the property factor, many in¬ consistencies appear, both actual and poten¬ tial. Presently, at least one state requires the Capitalization of leased property in determin¬ ing the property factor. Another major state does not include leased property. Several states require that notes and accounts pay¬ able not due within a year be capitalized even though the motion pictures which will be made with that money may not be com¬ pleted for several years and the money may not have been borrowed within that state. Pay-TV Congressional Pot Kept At Boil By Harling NEW YORK — Philip F. Hailing, chair¬ man, Joint Committee Against Pay TV, in a recent letter to Rep. Dale Alford (D., Ark.), chairman of the House Small Busi¬ ness Subcommittee, said exhibitors are prepared to present “the people’s side” of the pay tv controversy at any time. Harling also informed Alford that the joint committee had planned to testify until it was announced that recent hear¬ ings would not discuss pay tv. However, Harling stressed that it was Alford him¬ self who injected the pay tv discussion into the proceedings. Veteran Exhib Sells Last Two Theatres ST. LOUIS — Although Charlie Goldman has given up his last two theatres and will no longer be an exhibitor, he will still be active in the film business. “It’s in my system and I couldn’t give it up,” he said. Goldman and his partner, Julius Leventhal, began in the business 42 years ago this month with a small theatre as 6303 Clayton Road. “It was a really small theatre — complete with a pot bellied stove,” he remembered. Up until seven or eight years ago, the two partners bought and booked for 15 theatres locally. Recently, they have run only the Sen¬ ate and Harlem, which have been taken over by Harry Wald and Malcolm Meyer, respec¬ tively. “But I’m definitely not through with the film business,” Goldman said. “I intend to stay active on the Employee Welfare Fund, in the Variety Club, to visit the MITO, and to work with the WOMPIs whenever they need me. And most of all I do want to thank every one in the film industry for making these last 42 years so fascinating and wonderful.” Fox Maps '62 Plans WASHINGTON, D.C.— Robert L. Conn, 20th Century-Fox sales cabinet member, ar¬ rived here to preside at the sales and distri¬ bution meetings for 14 branch managers and six advertising-publicity directors, at which he was to outline the company’s sales policy release schedule for the first six months of 1962. The sales executive announced that 20thFox would release one, and in some in¬ stances, two major films each month. Conn also outlined the “influential center open¬ ings” planned for “The Innocents.” “An even greater potential problem arises in our case due to the fact that the rental' property does not remain permanently in one state. The physical inventory of our member companies includes motion picture prints which are rented to theatres in every state. A print is normally used in more than one state during the course of a year. In which state is the print to be included as part of the prop¬ erty factor, since it was used to produce reve¬ nue in each of the states? Some easily applied uniform method of apportionment should be agreed upon so that no overlapping results.” German To Be Feted At Charity Luncheon NEW YORK— William J. German has been selected by the executive committee of the motion picture division of the Federation of Jewish Philanthropies as the guest of honor at the special industry luncheon at the Astor Hotel on Jan. 18, 1962, it is announced by Barney Balaban, honorary chairman; Leo Jaffe, chairman; and Harry Mandel, associate chairman. The luncheon, which will wind up this year’s Federation drive, will be attended by outstanding figures from the motion pic¬ ture industry. German, president of the company which bears his name, has long been associated with the industry in numerous capacities and has been active in every charitable drive spon¬ sored by the industry. His philanthropic ef¬ forts have long been heralded throughout the entertainment field. Among the organizations in which he has actively participated as a di¬ rector, chairman or member are: Variety Tent of New York; Motion Picture Pioneers; The Salvation Army Association; Academy of Mo¬ tion Picture Arts and Sciences; St. Vincent’s Hospital Society; Museums of Modern Art and Natural History; Cardinal’s Committee of the Laity; Joint Defense Appeal; American Jewish Committee; Catholic and Jewish Ac¬ tors Guild; American Theatre Wing; Ameri¬ can National Theatre Association. He is also a director of Seaboard Associates, the Will Rogers Memorial Hospital and other important business and philanthropic organi¬ zations. A record turn-out is anticipated for the luncheon. WOMPI Chairmen Set CHARLOTTE — Mrs. Myrtle Parker, presi¬ dent, Association of Women of the Motion Pic¬ ture Industry, announced the appointment of the following committee chairmen to serve during 1961-62: Membership chairman: Mrs. Margaret Irby, Memphis; by-laws chairman: Miss Jane Elle Moriarty, New Orleans; extension chairman: Mrs. Mary Hart, Jacksonville; publicity chair¬ man: Mrs. Viola Wister, Charlotte; nominat¬ ing chairman: Miss Joan Shields, Toronto, Canada. Special committees have been set up with the following chairmen appointed: Public relations chairman: Miss Florence Long, Toronto; Will Rogers chairman: Mrs. Frankie English, Atlanta; rules and regula¬ tions of awards chairman: Mrs. Mable Guinan, Dallas; ways and means chairman: Mrs. Bon¬ nie Steward, Memphis; 1962 convention chair¬ man: Miss Mary Heueisen, Kansas City. Glen Alden Seeks Swift NEW YORK — RKO Theatres, and its par¬ ent, Glen Alden Corp., announced their in¬ tention to acquire Swift Manufacturing Co., Columbus, Ga. Albert A. List, Glen Alden president, said the company has already purchased 30 percent of Swift’s outstanding shares, and that an offer to Swift stockholders to buy stock at $109 a share has been made. Glen Alden paid $109 a share for the earlier block. Acquisition is contingent on GA getting at least 80 percent of Swift’s stock by Jan. 3, 1962. 6 MOTION PICTURE EXHIBITOR December 20, 1961