Evening star., 1936-08-22
D. SUBMISSIONS
Is PCT. OF FIRMS
PAY JOBLESS TAX
Decrease in Levy Seen,
However, by Increase
in Reserves.
31,680,O00 ESTIMATED
AS PAYMENT IN 1886
D. c. Compensation Board Plans
to Delay Court Action in
Collecting Assessments.

Approximately Is per cent Of tn,
employers taxable under the Distric
Of Columbia unemployment compen
sation act are in default at the presen
time, it was disclosed yesterday b!
John A. Marshall. director of tn,
District Board. AL of these, he said
will be subjected to persuasion BY
agents Of the board and, II insistent
in their failure to meet the l per CEN
pay roll assessment, may face court
action.
Placing great reliance in the per.
suasive factor, however, Marshall saic
he does not anticipate any necessity
for wholesale recourse to the courts
in order to make the tax provision
effective.
With . door-to-door canvass OF
taxable business establishments just
completed, the director said that rec
ords are on hand for about 13,50o
employers who should be contributing
to the unemployment fund. In June
when agents of the board were making
their canvass. actual tax reports were
received from 1876, but for the
month of July returns were received
from only 10,232. It is this difference
Of some 5000 employers who will be
subject to pressure from the board in
the next few weeks. Few of those
interviewed thus far have made any
fiat refusal to pay. Marshall claimed
most Of them pleading ignorance Of
the laws requirements.
Adequate Fund Indicated.
Even with this relatively high per-
centage Of defaulters, the District
fund is piling up in q manner to indi-
cate that present tax requirements will
be fully adequate when benefit pay
ments begin and may even leave the
way open for q reduced rate and
elimination Of the District contribu-
ton.
Tax contributions for the first seven
months of this year have ranged from
sl07,023 to $15l,243, with the average
being about $4,000. At this rate,
the years tax receipts will be about
81 $50, 900, to which Is added the Dis
trict contribution of 100000.
For 1887 the tax rate jumps from
1 to 2 per cent. indicating twice the
1886 revenue from that source, OF
about $3,360.000. To this will be
added a District contribution of $125,-
600. Thus it seems that the District
fund is sure of a minimum reserve
Of $5,265,O0O when benefit payments
begin in January, 1888.
Increases Again in 1888.
Then. according to the law as II
now stands, q 3 per cent tax will be-
come effective with revenue at the
present rate accumulating in the sum
of more than s5,000,00 yearly from
taxes alone. For 1888 only, according
to the present law. the District will
contribute $l75,000.
With the s5,000,000 estimated taz
revenue computed on the basis of only
about 10000 employers now contribut-
ing. the 3 per cent levy might easily
raise close to $7,000.000 If all the
taxable employers are brought into
line. Such an income, it is believed
by some who have made close study
of eligible employment turnover in the
District, is more than would be needed
for the yearly benefit payments. II
Is this circumstance that leads to the
hope of a possible tax reduction.
One possibility, for instance, is that
the board. in its yearly report to
Congress, might request the authority
to lower or raise the rate between
2 and 3 per cent as needs dictate.
Such power would give them the
means of avoiding piling up an ex-
cessive reserve and also would leave
the way open for meeting unforeseen
demands.
Stability May Be Rewarded.
Another possible amendment pro-
posal would affect the merit system
provision of the present law. This
allows, in its terms at this time, for
tax reduction to a minimum of IL
per cent for employers with record
of stabilized employment. Those
having q large turnover may be
boosted to a maximum Of 4 per cent.
Members of the board have ex-
pressed themselves in full support Of
the merit principle and the idea Of
furnishing an incentive for business
to stabilize its employment, but the
present formula by which five year
records of each individual firm must
be axamined to provide basis for
any tax adjustment has been called
unwieldy. Among possible aiterna-
tives is q plan for grouping types of
business and giving all within the
same classification the same tax rate;
another is to apply the merit principle
only to large employers where one-half
of per cent would make a substantial
difference in tax payment.
Contributions by Months.
The boards records show contribu-
tions as follows during the first seven
months:
January -----------------$l2 $l27, ,429 .S5
February ..-----------. 136, ,7O0.27
March -------------- la 4,388.85
April 143,147.60
May Isl ,243.35
June .-----------.- 1913
July 107,023.15
These receipts represent individual
contributions as follows:
March 6.840
April 1890
May OBSERVATION-DISCLOSURES 9,259
June 1876
I,,I,z IN oao