Evening star., 1937-10-23
BY JAMES r. CHINN.


The 1899 District budget estimates,
calling for appropriations totsling
$40. 100 900. we're transmitted to the
Budget Bureau today shortly before
the Commissioners went into an execu-
tive conference with the special
Municipal Tax Committee to map out
a new program of taxation.
Mai. Daniel J. Donovan, auditor and
budget officer, rushed the estimates to
the Budget Bureau to give its men,
bers an opportunity to scrutinize the
various items 1t contains prior to
the start of the budget hearings
Monday AS chairman of the special
tax committee. Maj. Donovan also is
taking leading part in the tax
conference with the Commissioners.
Based on $4,000, 900 From U. s.
The SAC. 700 900 budget is predicated
on a IS ,00D, 900 payment by the Federal
Government toward District ex-
penses-the same. amount rs appro-.
priated for the current fiscal year
as we'll as adoption Of an anticipated
new form of taxation that viii yield
as much as the present business
privilege tax, which expires at the
close of the current fiscal year. The
business privilege tax was estimated
to produce $3,000000.
The major problem confronting the
Commissioners and the tax committee
is the determination of the form OF
tax to be recommended to Congress
as substitute for the business privi-
lege levy. Four proposed taxes are
under consideration, and others may
be developed at the conference.
The tax committee is understood
to favor . general sales tax Of or
per cent to replace the business
privilege tax. 1t also win place be-
fore the Commissioners three other
new tax plans, as follows:
1. An income tax.
2. An increase in the present tax
on public utility corporations
8. A general sales tax on beer.
Income Tax value Seen.
An income tax. 1t is believed, will
produce just as much revenue as
general per cent sales tax. If it
is made all-inclusive to include non-
residents who work in the District as
well as Federal employees whose in
comes are not taxed by the States
in which they live. Either Of these
taxes, it was said. would yield an
additional s5,00oo 900 a year.
The proposed general sales tax on
beer, however, probably will be dis
carded in view of the latest estimates
of District officials which show it
would not produce more than $500, 900
year. An increase in the tax on
public utilities likewise would not
bring in sufficient revenue after ex-
piration Of the business privilege tax.
Revised estimates indicate an addi-
tional levy on the utility corporations
would not squeeze out Of them more
than 100000 a year.
Incidentally, Riley E. Elgen, chair
man of the Public Utilities Commis-
sion. announced he would oppose an
increased tax on the utility corpora
tions. simply because such . ia;
would be charged to operating e.
penses and passed along indirectly t.
the public.
New Tax on Consumer.
ANY tax on utilities would really
be a camouflage tax on the public"
said Mr.. Elgen. IF you could really
tax the utility corporations I would
favor the proposed plan. But under
present conditions such q tax would
only be another tax on the con-
sumer."
The 49.7OO,ooo figure in the 1899
budget shows the Commissioners
slashed more than SIS, 5,000,0 OF the
estimates of the department heads.
This figure probably will be further
reduced by the Budget Bureau, if it
adheres to usual policy. and Chair
man Collins of the House 6ubcom-
mittee on Appropriations which will
frame the 1889 District supply bill
already has indicated he proposed to
prevent the appropriations from ex-
ceeding $48,000.00o. The apprppria-
tions for the current fiscal year totaled
SAG, 900 900. ~.