Motion Picture Herald (Mar-Apr 1947)

THREE N. Y. CITIES EYE BOX OFFICE May Take Advantage of Taxing Power Allowed by New State Law With three of New York State's seven largest municipalities preparing to take advantage of the taxing powers recently approved by the state legislature, including the levying of a five per cent admission tax, the Metropolitan Motion Picture Association and the American Theatres Association were to meet in New York this week to prepare their campaigns to inform the public of the inequities of the measure. Buffalo and Yonkers are understood to be in favor of immediately invoking the newly authorized taxing powers, while Mayor William O'Dwyer has said he is glad New York City now has such powers. Other cities, meanwhile, are studying the possibilities of the measure. Arguments Fail Last week Robert W. Coyne, executive director of the ATA ; Oscar Doob, Loew's Theatres ; Fred J. Schwartz, president of the MMPA ; Morton Sunshine, representing the Independent Theatre Owners of America ; Henry J. Walters of RKO Theatres, and Sol Ullman of Fabian Theatres, met in Albany with Governor Thomas E. Dewey to argue against the proposed tax measure. Their arguments were unsuccessful. The state law, which at midweek was almost assured of the Governor's signature since he previously recommended passage of the bill, would enable all counties and those cities with more than 100,000 population to impose a five per cent tax on admissions and would tax automobiles, liquor and restaurant meals. Meanwhile, lawyers and representatives of the major film companies met in New York last Friday to discuss means of combating the tax. The MMPA-ATA campaign, if undertaken, will make use of newspapers, radio, billboards and other available media, including a special trailer, to explain to the public the inequities of the tax. The campaigns would be used in those municipalities where the admission tax is imposed. Fight Ohio Proposal In Columbus, Ohio, Monday, P. J. Wood, secretary of the ITO of Ohio, told exhibitors in a special bulletin to contact their state representatives immediately and voice their opposition to Governor Thomas J. Herbert's proposal that the state vacate the admission tax field and permit municipalities to impose local admission taxes. "If this bill were passed by the legislature," said Mr. Wood, "it would bring down upon the amusement industry in Ohio a hodge-podge of local amusement taxes of varying rates as high as 10 per cent." Further repercussions of the Fox West Coast-Warner Brothers San Bernardino tax case, in which the theatre interests won a victory, are being sounded in Stockton, Cal., where Fox West Coast says a comparable situation prevails. FWC officials claim that their four theatres had been paying city admission taxes under protest since the San Bernardino tax was ruled unconstitutional and discriminatory last November. Citing the unfair allocation which the amusement tax set on theatres, the FWC spokesmen said that they were paying approximately 39 per cent of the city's total revenue. That the burden was too heavy was evidenced, they said, by the January gross for their California, Ritz, State and Rialto theatres, which amounted to $7,428, as against an amusement tax of $2,897. Fox West Coast officials are conferring on possibilities of bringing suit against the city of Stockton. Seek Minneapolis Fee Rise The Minneapolis License Commission plans to increase annual fees for theatres which would lift the total income from the source about three times, the greater rise hitting the smaller theatres, according to Stanley Kane, executive director of North Central Allied. Opposing the plans for the increases, Mr. Kane suggested the commission abolish the present zone system and establish a flat rate seating capacity. In Bristol, Va., motion picture interests have defeated a proposed five per cent admission tax. The City Council had planned to invoke the tax, but in an emergency meeting exhibitors pointed out that such a tax was unjust and the measure was dropped. The Tennessee General Assembly adjourned last Saturday without enacting any admission tax. A proposed bill to put a five per cent state tax on theatre tickets failed to reach the floor of either house. The Attorney General's office has held that the two per cent sales tax, which will take effect June 1, does not apply to admissions. In Oklahoma Tuesday the Senate Committee on Revenue and Taxation killed a bill which would have extended municipal taxing powers. The message had been opposed by the Motion Picture Theatre Owners of Oklahoma. Bill Would Halt Changes In Admission Prices Admission price changes to amusement places during evening hours, Sundays or holidays would be prohibited under a bill introduced last week in the Pennsylvania Legislature by Rep. Joseph A. Scanlon. Changing of prices during peak or dull periods would be stopped by the measure. Treasury Ready To Fight Protest On Capital Tax Washington Bureau The Treasury Department legal staff is gearing itself to fight anticipated tax suits in Los Angeles and New York resulting from the year-old ruling on capital gains in the picture business. Since last summer, the Los Angeles and New York offices of the Bureau have been sending bills to those involved in socalled personal corporations, initiated for the production of a single picture. After distribution profits are collected, the corporations dissolve and receive the benefit of the cutrate liquidation tax rather than paying full tax on earnings. Involving millions of dollars, the tax is retroactive to 1945 and considerable sums have been asked of the companies involved. Treasury attorneys say the Government had a right, under the Revenue Act, to rule against such corporations. How far back the collections can go appears to be the major question involved. The Washington office turned the matter over to the Los Angeles and New York branches of the Bureau. Instructions were issued nine month ago by the Department that the branches enforce the ruling and send out bills for collection of the underpaid taxes. Those individuals receiving large back tax bills are expected to contest the case in district tax court. 2 Industry Bills Before Dewey Two bills affecting the industry are awaiting the signature of New York State's Governor Thomas E. Dewey. Last Thursday the Assembly passed the CondonWadlin bill amending the general business law to place projection booths under the inspection of the State Labor Department. The bill is intended as a safety measure to insure the meeting of present day fire-proofing standards in all booths. The same day the Finch bill was passed. This bill allows the appearance of children under 16 in motion pictures, circuses, stage shows and radio and television broadcasts under a permit system. Vetoes Copyright Bill Governor Ralph F. Gates of Indiana March 15 vetoed a copyright bill directed against the operation of the American Society of Composers, Authors and Publishers in that state. The bill would have forbidden the owners of copyright musical works to operate in conjunction with other copyright owners to enforce, the public performance of their works. 28 MOTION PICTURE HERALD, MARCH 22, 1947