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Show adoption of the sales tav n In Utah3 ZZnW by the crisis public thon? r Evernnt and i'uunc school finances. This em ergency arose from the large num bor of property tax deliqucnctes during the early I930's lul-ncles mJ'V SfU',dy rcveal3 that durin-the durin-the first few years 0f its operation, opera-tion, the sales tax provided revenue rev-enue for sch varied activities of lnn ,PHbli? Schools' construction of needed state buildings, supplementing supple-menting the revenues of the State General Fund, programs administered adminis-tered by the State Board of Health, operation of the State Tax Commission, operation of the Office Of-fice of the State Auditor, as well as providing relief for Utah residents res-idents who were destitute and in necessitous circumstances. The entire nrncooB jax Study Group Gives Utah Sales Tax History Tvmtrarv to 11 common though tnken 'impression, the sales tax , not originally levied in Utah W'rlnsively for okl-nge assistance , miblic 'welfare purposes, it was i tod in a research report issued ilV by Utah Foundation, the J,n-profit private tax study agen- The report quotes various re-j-ts nt1 records of the 1933 per" "'ben the sales tax was under consideration which indicate that f. ,. , r-;uo ui Liie sales tax after administrative expenses .were not earmarked for welfare purposes until 1839. This practice continued until 1945 showher highlights of the study n 195' tne Legislature provided provid-ed for the transfer of all revenues J"4.11!,851163 Tax (Emergency Re-liet Re-liet ) Fund in excess of $6,000,000 to the State General Fund. Full legislative control over welfare wel-fare appropriations and the distribution dis-tribution of the sales tax was again assumed by the 1947 and succeeding Utah Legislatures. Utah's sales tax has yielded more than $146 million to the State between 1933 and the fiscal year ended .Tune 3n icmo Sales tax collections of $16.9 million in fiscal 1952 were nearly 10 times as great as the amount collected in fiscal 1934, the first full year of the tax. Approximately $138.1 million in sales tax revenues has been distributed dis-tributed to various agencies and funds in Utah since 1933. Undistributed Undis-tributed sales tax revenues in the Emergency Relief Fund totaled $8,153,950 on June 30, 1952. Since 1933, $86.2 million, or 59 percent of total sales tax collections, collec-tions, have been appropriated or allotted for welfare purposes. Another An-other $9.7 million have been appropriated ap-propriated for the welfare institutions. institu-tions. Although a major portion of the! sales tax revenues has been used for welfare purposes, transfers and appropriations to other funds, agencies, and activities have made it possible in recent years to bal jance the general budget of the , State. This has made it possible ; to avoid imposing additional state j taxes such as a state property tax for general or building purposes. I Of the sales tax revenues not used for welfare or institutional purposes, $15.8 million have been transferred or appropriated to the State General Fund, $15.0 million have been used for the construction construc-tion of needed state buildings, $4.1 million have been allocated or appropriated ap-propriated for public health services ser-vices and hospital construction, $3.5 million for public schools, $2.0 million for administration of the tax, and $1.6 million for miscellaneous miscell-aneous purposes. At present, 31 states impose a general sales or gross receipts tax. In recent years, a number of municipalities in some states have adopted the sales tax as a means of raising local revenue. It is estimated that the exemption exemp-tion of food and drug items from the sales tax (as recommeded by the Governor to the 1952 Special Session of the Legislature) would reduce the tax yield by $3.8 million mil-lion a year, or approximately 22.7 j percent of total sales tax collect tions. i The Utah Foundation study notes that adoption of the sales j tax in the thiries was opposed be- j cause of its regressive impact (i.e., persons in-' the lower income . brackets pay a higher percentage of their incomes in sales taxes than do those in the upper income in-come brackets). However, it is pointed out that the steeply graduated grad-uated Federal income tax in - the tax strucure since 1940 has largely large-ly offset this earlier objection. |