Evening star., 1937-03-30

submitted. AS a result of these studies
the following conclusions have beer
reached:
First. That the three or four poin
formula contained and recommended
in the so-called Jacobs report to bt
used to solve the fiscal relations prob.
lem is unsound, both from the stand.
point of equity and workability. Its ap-
plication would tend to increase mate
rally rather than decrease the contro.
versy as to what constitutes an equit-
able fiscal arrangement between the
two governments. 1t would further
complicate budgetary procedure, in
crease personnel, and multiply execu-
tive fingers in the governmental opera
ton with its resultant loss of efficiency
and, consequently, increased govern
mental costs. The measuring and
valuing of each specific item of serv-
eral Government, and the Federal
Government performs for the District
as recommended in point l of the
three or four point formula, would
entail a vast amount of statistical
work, increased personnel, and the re-
suit would be anything but satisfac-
tory. There would be no limit as to
what the District government could
charge in their bill for each service
and each bill for such service would
cause much controversy as to the cor
rect charge, thus making multitude
as at present obtains under existing
procedure.
THE other two or three points
recommended by the Jacobs report
are as visionary and fantastic as the
one just mentioned and will be dis
cussed at length later.
See Weak Tax Structure.
Second. That the entire tax struc-
ture in the District is decidedly weak
and fails to produce nearly the rev.
enue that q modern tax system would
raise. That is especially true of its
specific and license tax system. Mil
lions of dollars annually in revenue
are lost to the District because of this
There is an utter lack of
equality in the imposition of license
taxes and the rate, in most instances,
Is ridiculously low. The owners of the
base ball park pay an annual license
tax of only S5, while the owners and
operators of amusement parks, not
used for base ball or athletic purposes.
pay an annual tax of S65, and the
owners of indoor or outdoor swimming
pools pay an annual tax of SIS. Per-
sons engaged in manufacturing bed
pay a tax of S75 per an
mum, while the owners OF dry clean
Ing and dyeing establishments pay
only IS per annum. Many more in
stances might be cited. Owners of
regular theaters where dramatic per-
formances are given, and where operas
are sung, pay license tax Of $50 per
while the owners or operators
Of large and profitable moving pic
ture theaters pay only $50 per annum.
THE committee believe that the en-
tire tax system in the District should
be thoroughly investigated with the
view of materially broadening the tax
base and equalizing both property and
specific tax levies. This is absolutely
essential to balancing the District
budget. Either that must be done or
Congress will be asked to contribute
much more than it should to the sup
port Of the District government.
Having given full and careful con-
sideration to the various elements in
volved IN the question OF the fiscal re-
lations between the two governments,
the committee believes that a Federal
payment adjusting fiscal relations and
to bs used toward the expenses of the
District government of $5,O00,0O0
would b a fair and equitable arrange
ment and recommends accordingly"