Television digest with AM-FM reports (Jan-Dec 1950)

4 hold Appliance Wholesale Industry Advisory Committee (see p. 11 for membership), passed its first resolution. This asked that "all consideration of production of components or devices intended for the receiving equipment to be used for color TV reception be postponed until such time as materials and components shall be in safe and adequate supply to meet the requirements of the present emergency." Group estimated that color sets would require "at least double" number of tubes used in monochrome sets. Spokesman said stoppage of color development wasn’t intended. Distributors have been among most vehement opponents of CBS system. Whether NPA will ignore this hot potato isn't known, although Retailing Daily excitedly reported that NPA "will soon approve" group’s recommendation. :jc :{c 4c From practical standpoint, attitude of Dr. Allen DuMont is probably typical, quoted from his year-end statement on TV prospects for 1951: "Where color TV is concerned, the recent demonstration [by RCA] of a vastly improved all-electronic and compatible system of color, coming on the heels of statements that such a system wasn't feasible and an FCC decision in favor of mechanical color, has thrown the whole color situation into a state of complete confusion. It will take considerable time to settle this question. In any case, the abundant problems now facing the industry make it evident that the color question for 1951 will be mostly an academic one. " Emerson’s Benjamin Abrams feels ntuch the same; "The inevitable scarcity of black-and-white receivers next year has driven the color TV problem to the very bottom of the manufacturer’s active worry list," HOW EXCESS PROFITS TAX BILL HITS TV: TV-radio industry fares quite well, as growth business, in excess profits tax bill finally agreed upon by House-Senate conferees Dec. 22. Senate passed bill (H.R. 9827) same day, with House scheduled to approve after Xmas holidays. Tax is retroactive to last July 1. "Couldn't have had it better," was consensus of those handling industry’s case. Here are details as they apply to TV-radio industry: Excess profits tax rate is 75%. Liable to excess profits tax are earnings that are more than 85% of best 5-year average during 1946-49. Alternative is this rate of return on invested capital, including borrowed funds; 12% on first $5,000,000, 10% on next $5,000,000, 8% on remainder. Regular corporation tax is boosted from present 45% to 47% for taxpayers’ fiscal year after July 1, 1950. This means most corporations will pay the extra 2% on 1951 earnings, since most are on calendar year basis. Exempted are corporations earning $25,000 or less annually. Maximum to be paid in both excess profits and corporation tax is 60% of year’s earnings. Growth companies — and this is victory for RTMA committee — figure base for excess profits tax on 50% of 1949 and 40% of 1950 earnings. A company may qualify regardless of total assets if it meets all 3 of the following criteria, all directly applicable to TV-radio: (1) Total sales first 6 months of 1950 multiplied by 2 equal or exceed 150% of average 1946-47 sales. (2) 40% of 1950 sales are attributable to a product not generally available to the public before Jan. 1, 1946. (3) Sales of such new product in 1946 must have been one-twentieth or less of such sales in 1949. A company may also qualify as a growth company if: (1) its gross receipts last half of 1946-49 base period are 150% or more of first half of base period, or (2) if its total payroll last half of base period is 130% or more of the first half of such base period. But, company's total assets can’t exceed $20,000,000. Foregoing provisions cover virtually every TV-radio manufacturer, in the opinion of tax experts. But those close to tax picture warn not to underestimate tax legislation bound to come from 82nd Congress, which meets Jan. 3. They see higher taxes all around — excess profits, corporation, income, excise, even possibility of general sales tax.