Evening star., 1922-07-02
Rate by Mail-Payable in, Advance.
MARYLAND and virginia,
All Other States
The New Tax Rate.

appropriation bill, containing a pro-
vision that is designed to put the Dis
irict on a "cash-payment basis" by
the 1st of July, 1927, the Commits
sioners are required to change the
mode of taxation. They must increase
the assessment Of realty from two
thirds of the real value to full valua-
ton. They must then change the rate
Of taxation to yield. during the five sue
ceeding fiscal years, a sufficient sum,
in addition to meeting the current ap-
propriations. to enable the District five
years hence to meet acquisitions under
appropriation acts with cash, instead
Of relying upon the federal govern
ment for cash advances until its tax
revenues are available.
In determining the rate that, ap-
piled to a Naturalization assessment,
will yield such sum, it is necessary
for the Commissioners to take several
factors into account. In the first
place, by reason Of a change in the
law effected by the appropriation act,
they can count upon the payment Of
approximately half of the years taxes
by the 1st of December. Thus within
five months of the beginning of the
new fiscal year there will be in hand
sum sufficient to meet the Districts
share Of the. appropriations for six
months of the year. If the District is
adjudged by the joint select commit
tee just organized. and by Congress
upon the presentation of its report in
February next, to be entitled to all or
a part of the surplus of about $5,000,-
600 of unappropriated District tax
revenues now lying in the Treasury.
that sum will be available as a cash
asset, to serve as part OF the cash
basis surplus. But the new rate must
he determined in advance Of any pos
sible report from this committee and
action upon it, to permit the levying
of the semi-annual tax due in the
month of November. Inasmuch as the
amount that will be adjudged thus
available as part Of a cash-basis sur
plus is indeterminate at present, the
Commissioners cannot take it into ac-
count now in fixing the rate for this
year.
Their problem Is to ascertain the
rate at which full-valued District
realty and tangible personality will
yield enough to supply this years
needs, plus five-twelfths of an extra
years needs divided into five annual
.installments. That would seem to en-
tail roughly an increase in the yield
by one-twelfth for each Of the succeed
ing five years. But there are certain
factors that complicate the problem.
For instance, the advance OF realty
valuation to 100 per cent from 66 2-3,
while tangible personally remains as
heretofore at 100, means that with a
reduced tax rate tangible personally
will yield less in taxes than before,
and realty must make good the diff
ference. Moreover, there is no assur-
as upon the revenues Of the public
utility corporations, are by law col
lectibIe on the half-yearly basis.
Again, with no provision in the new
law for appeals from personal tax as
sessments, now appealable annually in
February, ground may be laid for con-
troversy over the payment of half of
the tax without recourse to possible
revision of the assessment.
1t is reasonably assured that the
District appropriations will increase
during the next five fiscal years, 50
that it Is impossible to estimate with
accuracy the sum that by July 1, 1927.
it will be necessary to have in hand as
a cash-basis surplus sufficient to meet
the Treasury acquisitions from the be-
ginning Of the fiscal year with 50
cents Of District money on each dollar
of expenditure. The Commissioners,
however, are not at present required,
nor can they reasonably be expected,
to take this prospective increase into
account. They should, and doubtless
will, accept the present District budget
law as the basis for their calculations,
figure upon getting half the taxes in
November and then compute the rate
which will yield enough over current
acquisitions to give them by the end
of the fifth fiscal year in succession
sufficient to meet the requisitions until
the halfyearly taxes are paid in No
vember. Any other calculation would
he in excess Of the requirements of
the law.