Evening star., 1937-12-12
BY DON S. WARREN,

Carefully calculated financing plans
OF the District government for the
next fiscal year will go a-glimmering
when the results of the business priv
ilege tax on gross receipts are finally
recorded and the 1899 budget will be
thrown out of balance, according to
information obtained yesterday by
The Star
Estimated by officials to produce
100000, the business privilege tax
now stands to bring into the District
Golfers between 81 200, 900 and $2,000,-
600.
Without counting on such q de-
velopment, 1t had been estimated that
the District would come to the end
Of this fiscal year with a deficit OF
about 100000. This was expected
to be made up by the receipts next
year Of the taxes on inheritances and
estates.
If an additional 81 900 900 is added
to that deficit, some drastic changes
would have to be made in the pro-
spective tax plans, or in the proposed
District budget for next year, officials
agree.
Officials Are Concerned.
No estimate has been made by
ohcials as to the revenue expected
to accrue from the business privilege
levy. but it is no secret that they are
concerned over the reports to date.
None would speak for publication,
but these facts stand out:
The District to date has collected
approximately s500,000 in taxes on
gross receipts reported by business
firms and individuals engaged in COM
mercial or professional callings.
Since these taxes may be paid in two
equal installme nts, it may be assumed
that this is but half the tax payment,
which would make the total now an
ticipated about s1,000,000
Added to this sum Is $206, 600 so
far collected in the $40 fee required
for licenses for persons or corpora
tions engaged in taxable businesses or
professions. This would bring the
minimum expected receipts from the
tax to some $l,200,000.
Levy Appears TO Be Flop.
In short, on the basis of monies
already received, it would appear that
the business privilege levy is a sub
stantial flop, as measure calculated
to produce this year about $4,000, 900,
1t is recalled that this levy, by law,
now is to operate only one year and
will expire automatically next June
80, unless extended by Congress.
Failure of the tax to measure up
to calculations is attributed only
partly to q revolt" by taxpayers,
judging from ff-the-record conver-
sations by District officials. They sug-
gest that perhaps many taxpayers
making returns incorrectly assumed
that the bill applied to net receipts
rather than to gross receipts. There
is q thought also that perhaps some
Of the larger taxpayers are withhold
ing returns or payments until the
levy has been subjected to final
court test. Several attacks have been
carried to the courts.
On the other hand, officials can
not explain how the receipts so far
should be so small, as the estimates
we're based on Census Bureau data
on the extent of business of all kinds
transacted in the District.
| Some Officials Optimistic.
Some District tax officials yester-
day clung to a more optimistic out
look than pictured by the current
expectations of minimum return
of but $1,200,000. They explained
that while only some $4,000 taxable
returns have been received to date
there were about 10000 individuals OF
concerns which paid the $40 license
| fee for government permission to con-
tinue in business.
These figures, these more optimistic
officials believed, would indicate that
perhaps q large percentage Of the
1000 who paid for license but die
(See %. c. TAXES, Page A-6.)