Evening star., 1938-02-27
, LOCAL BEER TAX
OF 81 A BARREL
WILL Be OFFERED
>Expected to Be Put Into
Revenue Bill by House
D. c. Unit.
REVENUE ESTIMATED
AT 100000 A YEAR
Corporation Counsel Draws Up
Plan-Price Of Brew Is Due
to Stay Same.
BY JAMES E. CHINN.

DS JaNALS ST1lNN.
A local beer tax of ST barrel is
expected to be written into the 1899
District revenue bill this week by the
Fiscal Affairs subcommittee of the
House District Committee. Such a
levy. it was estimated, would produce
100000 year in additional revenue
Acting on instructions of the sub
committee. Corporation Counsel Ell
wood H. Seal has drawn up beer
! tax plan. A blank space has been
:. left for the proposed rate, but sub
committee members, it is understood
do not believe it should be in excess
Of 81 barrel-the same rate that
was in effect prior to prohibition.
A local tax on beer was suggested
TO the subcommittee last week by Ed
ward F. Colladay. president of the
Washington Board of Trade, who
pointed out the District is the only
jurisdiction in the United States which
does not tax this beverage. He esti-
mated levy of from 81 to 50 a barrel
} would yield between 100000 and
100000 year.
Fear Too High Levy.
Subcommittee members fear a tax
IN excess of 81 barrel might increase
the price Of beer to the consumer and
curtail its consumption. They believe
the brewer. the wholesaler or the re-
taller would be able to absorb the ST
tax without raising prices.
1t also has been pointed out that
despite the lack of a local tax the
retail price of beer is no cheaper in
washington than it is in Maryland
or Virginia. The Virginia tax is s2.75
barrel, and beer which retails for 10
cents bottle in that State is sold
at the same price in the District.
Data collected by Mr.. Seal show a
$l-a-barrel tax would amount to 4
cents on dozen bottles
Revenue Relatively Small.
The estimated 100000 in revenue
which q $1-a-barrel beer tax would
produce, subcommittee members ex-
plain, is virtually negligible in COM
parlson with the amount that will be
needed to balance the 1899 budget.
The primary purpose Of applying the
tax is to remove the District from its
present unprecedented situation of be-
Ing the only jurisdiction in the coun-
try which does not procure revenue
from the sale of this beverage.
Mr.. Seal, at the direction of the sub
committee, also has drawn up a pro-
vision for inclusion in the bill calling
for repeal of the g-inoperative 60-40
substantive law which at one time
governed the basis of fiscal relations
between the Federal and District
governments. Congress has ignored
the law since 1922, when it adopted a
lump-sum policy. Since then the
annual Federal payment toward Dis
trict expenses has steadily decreased
to its present s5000,O00 level
Conferences Scheduled.
Chairman Nichols has planned to
call the subcommittee together early
this week to begin series of execu-
tive conferences at which the revenue
bill will be whipped into final shape
for consideration of the full District
Committee. A decision will be reached
1T these conferences as to whether
any of the three-point tax-raising
plans in the present bill are to be
scrapped. Some members want to
eliminate the unpopular business
privilege tax, and others want to re-
move the proposed income tax. And
Chairman Nichols believes the SITS
real estate tax rate as provided in the
bill should be reduced to $1.6O.
The full District Committee. now
ever, Is not expected to pass on the
lrevised bill until the 1899 appropri-
alton bill is reported to the Senate
and the actual amount of the budget
deficit in the coming fiscal year is
known. On the basis of the $45,0O0,-
600 appropriation approved by the
House, the shortage is not expected
to exceed $3,000,000. Any reductions
made by the Senate will automatically
reduce the deficit figure.