Evening star., 1938-01-23
By JAMES E. CHINN.

AoVlsaolllty OF scrapping the pro-
posed s5,ooo,oOo revenue bill for the
coming fiscal year, in view Of recent
developments, was considered yester-
day by prominenet member of the
Fiscal Affairs Subcommittee of the
House District Committee.
Abrupt abandonment of the con-
troversial tax program at this time
would mean natural death for the
unpopular business privilege levy on
gross receipts at the close of the
present fiscal year June 80, and the
end Of movement to impose an in
come tax on the District.
The present SITS tax on real and
personal property-25 cents higher
than in the last fiscal year-would
have to be continued, however, not by
legislation. but by order of the Com
missioners to balance the 1899 bud
get. The $1.75 rate is now a part of
the three-point tax increase program.
Special Levy Need Doubted.
The Tax Subcommittee member, who
has made serious study of the mu-
nicipal governments financial prob
lens, is under the impression special
tax legislation will not now be needed
to keep the District out of the red
in the coming fiscal year. His opinion
is based on the recent decision of the
District Subcommittee on Appropri-
atoms Of the House to slash about ST.
100000 off the Budget Bureaus ap-
proved total Of S47,344,702, and its
announced determination to have the
street lighting bill OF $765 900 paid
out OF the special gasoline tax fund.
Informed Of the proposal to aban-
don the tax program, Chairman Col
lins of the House Subcommittee on
District Appropriations said:
Well. We took the sails out Of that
subcommittee" He, too. was referring
to his committees 100000 cut in
the D. c. supply bill.
The Budget Bureau. in submitting
the 1899 estimates to Congress, esti-
mated the 1899 deficit at about So
100000. Maj. Daniel j. Donovan.
auditor and budget officer, said the
shortage might go as high as S5,00o,-
000 But that was ceiling" and in
cluded supplementals. The Fiscal AZ
fairs Subcommittee. however, made
that figure its goal when it started
writing tax increase legislation.
District officials admit the shortage
may not exceed s2,400,000. providing
the House and Senate make no major
changes in the 1899 appropriation bill,
and there are no supplementals and
other unexpected items to boost the
figure. And continuation of the exist
ing SITS real estate rate. it was said,
| will more than make up that deficit.
May Return to $3.50 Rate.
In fact, a 25-cent rise in the real
estate tax rate, it was said, will pro-
duce about s3.000,000. Unless Con-
gress requires the levy to continue at
the SITS level in the coming fiscal
year. it will return to the former $1.50
rate. But the Commissioners. 1t was
pointed out, have authority under law
to raise the figure to any amount they
regard as necessary to meet the Dis
trict's budget. And II Congress fails
to enact a tax bill, it was said, the only
alternative Of the Commissioners is to
order continuation Of the $175 rate for
another year.
While this member of the subcom-
mittee is not in favor of saddling the
increased tax burden solely on the
owner of real estate, he said it might
be the simplest solution of the pres
ent problem in view Of the inevitable
battle that faces the tax program not
only in the full District Committee
but on the floor Of the House and
Senate.
There are only two other ways to
save the real estate owner from car
rying the extra burden for another
year. 1t was explained. and that is to
have Congress reduce the appropria-
tions by S2,4O0,00O or increase the
Federal payment toward District ex-
penses by that amount.
The Subcommittee on Fiscal Affairs
will meet Tuesday at 10 am. to COM
plete its work on the new tax pro-
gram.