False Start

Many a citizen of Illinois rummaged through pockets, purses and pigeon holes last week in search of receipts for all their retail purchases since April 1. The Illinois Supreme Court had declared the State's 3% sales tax unconstitutional and retailers were to refund to their customers nearly $5,000,000 on documentary proof of tax-paid purchases.

Governor Henry Horner put the sales tax law through the General Assembly last winter as an emergency means of raising some $40,000,000 in revenue. Its proceeds were to be spent either on jobless relief or school expenses. *Only two kinds of retailers were exempt from the tax: farmers selling their own products and filling stations where gasoline is already taxed 3-c- per gal.

These two exceptions caused the whole law to fall to the ground. The Supreme Court ruled that farmers and gasoline stations were retailers and their exemption from that category by the General Assembly violated the uniformity clauses of the State's constitution whereunder all businesses in the same class must be treated alike. The court also found serious fault with the two-way spending system set up by the law.

Illinois' false start toward a sales tax left the State's unemployment relief program practically stranded. More and heavier borrowing from the U. S. looked like the only way out until the State could revamp its tax machinery to circumvent constitutional objections.

*Illinois has borrowed $55,243,721 from R. F. C., more than any other State.

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