Evening star., 1935-06-18
CORPORATION TAX
CHANGE URGED TO
HOUSE D. c. GROUP
Peoples Counsel Roberts
Submits Report on
Amendment.
THREE BILLS PROPOSED
TO COVER NEW METHOD
Measures Would Take Place Of
Bank Utility Levy Proposals
Now Considered.

A radical change in the method Of
taxing public utilities, banks, steam
railroads and other corporate enter
prises in the District is recommended
in a comprehensive report submitted
to the House District Committee to-
day by Peoples Counsel William A.
Roberts.
The report, bearing the signatures
Of Roberts, District Auditor Daniel
j. Donovan and Tax Assessor William
P. Richards, proposed three separate
bills to cover the new method of
taxation. AS a substitute for the
bank and public utilities tax bill now
before the House and Senate Dis
trict Committees.
One Of the outstanding recommen-
dations is designed to tax the holding
companies out Of business.
Refers to Roosevelt Message.
The report calls specific attention
to President RooSevelt's message to
Congress urging elimination of use
less holding companies and declared
not one of those interested in Wash
ington properties is essential to the
coordination. financing or integra-
ton of the "splendidly cohered local
utilities operations"
Nothing but good would result
from an integration of the corporate
structures and the disposition of the
investment into local hands," the re-
port declared. washington is ade-
quately able to finance and operate
its own utilities"
In the new taxation set-up, the re-
port recommended a provision which
would require each public utility op-
Grating in the District to pay annual
ly, in addition to all other taxes, a
franchise tax equal to 10 per cent of
the amount of all dividends reported.
Aside from the holding company
provision, the redraft of the taxation
bills, it was explained, follows the
| theory of a combination 4 per cent
tax On gross receipts and per cent
tax on the net corporate revenues.
These measures, it is believed, would
raise the income of the District at
The report points out that in 1888
the gas, electric. street railway and
telephone companies in the District
paid $950,000 less in taxes than they
would have paid if they had been
taxed on their property within the
District at the same rate applied to
real property.
Utilities Schedules Upset.
In addition, the report pointed out
that the merger of the street railway
companies in 1888 upset the schedules
Of the utilities to such an extent new
legislation will be necessary to provide
an appropriate tax ON the revenue
| producing units.
Discussing the taxing of banks, the
report reviewed the changes in the
banking situation in the District and
urged an entirely new system Of taxa
ton. 1t proposes that a confidential
report be made on all deposits and that
4-mill tax be substituted for the
present 5-min tax and that this be
paid directly from the deposits by
the bank.
The report includes a table show
ing the aggregate assessments on real
estate owned by the steam railroads
operating in the District is $13 $3.50, ,4S2,
while the Interstate Commerce Com
mission placed the deprecated values
of properties at $39.000,00O.
License Tax Difficult.
while we are definitely Of the
opinion that taxes now paid by the
steam railroads are very low and that
the roads do not bear a fair and just
proportion of the cost of maintaining
the government of the District of
Columbia" the report declared. "our
review of our former report, in the
light Of present conditions, indicates
that it would be extremely difficult to
compute a license tax based on the
value of corporate stock proportioned
in accordance with the value of ply
sical property within the District OF
Columbia.
"The committee IS also of the cpin-
ION that the railroads should be ex-
empted from real property taxation
upon structures used ia common with
motor trafic, as, for example, grade
crossing elimination structures which
they own, and for this reason sep
arate act, a draft of which is trans
mitted herewith, provides for the de-
| termination of TAX upon all railroad
physical property IN the District OF
Columbia at the prevailing rate, with
| Il sk- ,Nft k.n