First Straws

During the bitter-end battle over the withholding tax, many a financial observer nibbled his nails, brooding over the effect of the tax on war-bond sales, retail trade, family budgets. Last week, after three weeks of taxing, the first straws were fluttering in. Nail-nibblers could relax.

> For the first 23 days in July, war-bond sales (Series E, F, and G) were $701,959,160, up 2 1/2% over the same period in June. Redemptions were down 4%.

> In Michigan, where the tax clipped many a Ford, General Motors and Chrysler worker who had never paid income tax before, bond sales spurted, are now expected to top June sales by $8,000,000, a satisfactory 16% (five-sevenths of the sales are by payroll deductions). Example: in Detroit's ExCellO Corp., 15 employes reduced their war-bond deductions, 485 increased them.

> In Los Angeles, the booming California Shipbuilding Corp. reported July bond sales hopped $20,000 over June.

> In Chicago, Zenith Radio, Belden Mfg. and International Harvester companies found employes cheerfully buying bonds at the usual rate.

> U.S. department-store sales were down 2% under the preceding week, but were still a fat 18% above the corresponding '42 period.

These straws were slender, inconclusive. The full effect of the tax cannot be computed for some months. But the drift is plain. The fat pocketbooks of the U.S. are as yet unaffected by the tax.

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