Soloway Attacks Furcolo On State Sales Tax Plan

Arnold M. Soloway, assistant professor of Economics, registered vigorous opposition yesterday to Governor Fostor Furcolo's recent proposal for a state sales tax of three per cent.

Speaking at a Boston meeting sponsored by the Massachusetts Federation of Labor, Soloway condemned the sales tax for imposing "an undue financial burden on low income groups." Sen. John E. Powers, the Democratic minority leader of the State Senate, also talked at the meeting, attacking the governor's plan as a betrayal of the Democratic campaign platform.

Soloway said later that he considered Furcolo's proposed state revenue of $130 million a "ballooned budget, of a magnitude greater than is prudent or necessary at this time."

"Other measures could have been used to raise state income," he said, citing "a proper revision of the income tax regulations" as one.

Soloway criticized the arbitrariness of the proposed budget. "We don't have a budget request at all, but rather a request for a tremendous blank check," he said. He also predicted that a sales tax would fail to collect the estimated $112 million.

The projected sales tax would impose a levy of three per cent on all items except food, medicines, children's clothing, rents, light, heat, gas, telephone, and other utilities.

Two other University economists disagreed with Soloway on the governor's plan. Seymour E. Harris '20, professor of Economics, said that such a move has been almost forced on Furcolo by the urgent need for increased state revenue.

"As long as the proceeds from the sales tax are used to reduce the general property tax and to improve state educational facilities, it will be in general a good thing," commented Harris.

In his budget message on Wednesday, Furcolo estimated that the proposed tax would enable him to allot $75 million to the cities and towns of the state to be used in reducing local tax rates, especially the property tax.

Harris emphasized, however, that he supported such a tax only in special circumstances. "In general," he said, "I'm against sales taxes."

Otto Eckstein, instructor in Economics, agreed with Harris that a sales tax is not a completely satisfactory method for raising revenue. "An adjustment in the graduated income tax would have been preferable, but such a tax would not answer the immediate need for funds," he affirmed.