THEODORE R. MCKELDIN, GOVERNOR 297

4. I am convinced that the increased cost of distilled
beverages in most areas of the State that would result from
this legislation would increase the illicit importing and dis-
tilling of such liquor.

I am reminded of the liquor interests' extensive lobbying
last year for the passage of House Bill No. 14, now Chapter
783 of the Acts of 1953, providing an enforcement unit for
the Alcohol Tax Division of the Comptroller's Office.

They pleaded that it was necessary to combat "the de-
plorable conditions which excessive cumulative liquor taxes
have created in Maryland ..... the rebirth of illegal dis-
tilling and transportation, the growth of crime throughout
the State, the decrease in the legal consumption of distilled
spirits; the loss of County, City and State revenue; and the
severe injury to legally operated local businesses/'

These arguments were buttressed by an array of statis-
tical information which undoubtedly had merit and which
obviously impressed the members of the General Assembly.
The same 1953 session of the Legislature passed, with little
or no dissent, a joint resolution petitioning Congress for a
reduction in the federal excise taxes on liquor and stated
that "it is the considered judgment that the federal govern-
ment has raised its excises beyond the optimum level con-
sistent with the objectives of taxation and control; and has
taken from the State of Maryland the power to restore the
proper balance." There has been no reduction in the Federal
levy.

In the fact of sound legislative policy thus expressed, it
is diffcult now to see how a state-wide increase in the tax
could do other than accelerate the diminishing of its returns
by increasing the incentive for importing and distilling
liquor that yields nothing to the treasury of Maryland or
its civil divisions,

5. The lowering of the State's income from the tax on
alcoholic beverages would be entirely unjustifiable and in-
defensible when much more general, deserving and urgent
fields for tax relief exist. While it is impossible to predict
the fiscal position of the State more than a year from now,
when this bill would take effect, it is clear that the general
fund budget must depend primarily upon sales tax and
income tax revenues, while the servicing of our bonded debt
must rest, in the main, on the State real property tax.

Economic conditions might make it possible to reduce the
sales or income tax, or, by appropriating to the Annuity
Bond Fund, to reduce the real property tax, provided that
we do not tamper carelessly with existing revenue sources,
particularly when that tampering offers nothing to benefit