ABSTRACT
The manufacturers' sales tax is better suited than other general sales taxes for exempting food, housing, and clothing in an attempt to reduce the burden on low-income groups. The distinction between the origin and the destination principles is of more importance to the treasuries of the exporting and importing countries under a single-stage tax than under a turnover tax. In an open economy, the incidence of a general sales tax becomes ascertainable to a degree, because the "general" sales tax is no longer truly general: it does not apply to the rest of the world, which now constitutes a large tax-free area. If in fact the manufacturers' sales tax allows no such hypothetical price, the advantage of the wholesalers' sales tax is an allocative one; it exerts less tax pressure against downward integration.
