Evening star., 1938-01-19
BY DON S. WARREN.

Decision to impose an income taS
on all incomes earned in the District
in addition to continuing in effect
the business privilege levy and the 25-
cent emergency hike in the realty
tax rate. was announced today by the
Fiscal Affairs Subcommittee of the
House District Committee.
The action was taken over the pro-
test of Representative Nichols, Demo-
crat, Of oklahoma. chairman of the
subcommittee. He declared he would
fight the threefold plan when it
comes before the full membership OF
the House District Committee for &C.
ton.
The plan approved by the majority
OF the subcommittee is to apply the
income levy to members of Congress
and to all Federal employees earning
their salaries in the District, Repre-
sentative Nichols announced These
points. among others. last year caused
Congress to reject proposed District
income tax as a part Of this year S
CAllCl 6ClASS GoA ~ oSA diA
Congressional Exemption.
If the program reaches the floor
of the House it is expected there will
be q revival of the arguments that
members of Congress should be exempt
and that application of the levy to
Federal employees generally will def
nitely raise a constitutional question.
The rates to be incorporated in the
income tax portion of the bill were
not discussed at today's session. They
are to be determined later. Chairman
Nichols called another meeting Of
the subcommittee for 10 am. next
Tuesday.
Voting for the suggested plans were
Representatives Dirksen, Republican,
of Illinois; Cole. Republican, of New
York, and Wood, Democrat. OF Mis-
souri,. Representative Nichols voted
against each motion in the plan Of
fered by Representative Dirksen. The
fifth member of the subcommittee,
Representative Arnold, Democrat, Of
Illinois, who is an advocate of gen.
eral sales tax, was not present.
Sitting with the subcommittee were
Corporation Counsel Elwood H. Seal
10 v. Morgan, his special assistant in
charge of tax matters; Tax Assessor
Fred D. Allen and Leslie Gillis, stat
istician employed to make a revenue
survey for the members of the Com
missioners' Tax Coiemittee.
The decisions were reached in ex-
ecutive session.
In announcing the action of the
subcommittee, Mr.. Nichols declared:
II believe this is q mistake. Such
. tax program will raise more revenue
than the District will need next year.
I think we should select only two Of
the three tax plans, not all three OF
them. For this reason I shall oppose
adoption of the program when it
comes to the full committee"
Upsets Tentative Plans.
The action of the subcommittee
upsets tentative plans announced
last week by Mr.. Nichols, who reported
the group had reached tentative agree
ment to suggest continuation of the
business privilege tax measure, with
revisions to remove its obvious in
equities, and continuation of the
present Sits tax rate on real estate
and tangible personal property.
Last week, however, it was made
known that this program was being
delayed by advocates of an income
tax measure Of some kind. Two diff
ferent kinds Of an income levy had
been reported under consideration.
One of these would have taxed all
persons whose incomes were earned in
the District. The other would have
exempted all Federal workers and
members Of Congress.
Apparently the subcommittee has
decided to carry fight at least to the
full House District Committee for
adoption Of an income levy that would
apply to members of Congress and to
(See INCOME TAX PAGE All