Evening star., 1939-10-08
King Urges DC.
Budget Limit TO
Avoid Tax Rise
Commissioner Revised
Figure for 194l Put
At $50, 100000
By ]. A, O'LEARY.

BY j. A. OLEARY.
Chairman King of the Senate Dis
trict Committee joined last night in
the view already taken by leading
civic and trade organizations that
the next local budget be held with
In limits that would avoid fur
ther local tax increases.
At the same time it was learned
from reliable sources that the Com
missioners' revised budget total for
the fiscal year l941, starting next
July, will be approximately $50000,-
600, not counting trust funds.
This total, it is understood, would
keep the budget within estimated
revenues, indicating that District
Building officials are in accord with
the desire of civic groups to avoid
further tax increase legislation at
the next session of Congress. In
order to achieve this goal the Com
missioners are finding it necessary
to cut nearly $14,00O,OOO from the
original requests of department
heads, which aggregated close to
64,00O,0O0.
Reorganization Discussed.
In the course of conference yes
terday with municipal officials,
Senator King said proposed re-
organization of the local govern
ment also was discussed in general
although detailed consideration of 1t
is not expected until the budget
making task is finished. He met
with Engineer Commissioner Nc
Coach and District Auditor D. j.
Donovan.
The Utah Senator said he still
holds to the opinion that the
present form of local government is
satisfactory, with some modifica-
tons He explained that by this he
meant he would not object to pro-
viding the Commissioners with an
executive manager, and to bringing
about some consultations of exist
Ing municipal agencies.
While urging retrenchment,
Senator King said his visit to the
District Building left him very
doubtful as to the revenue qualities
of the present tax law" He said
he was apprehensive that the next
session may be compelled to con-
slider a new tax measure, but added
that "if possible we ought to
avoid it."
I'm view of that fact, the utmost
economy must be practiced," the
Senator said.
New Levy Disappointing.
Senator King said the revenue
outlook appeared disappointing"
from the new income levy, which
was added to the tax structure at
the last session of Congress, be-
cause of the limited number who
will pay under the provisions as
adopted.
One definition Congress wrote
into the income tax makes it apply
only to persons domiciled in the
District. which eXempts not only
all local wage earners who live IN
the adjacent States, but an unde-
termined number of individuals who
actually reside in Washington, but
who will be able to show they are
only temporary residents and that
their domicile is still in one of the
States, from which they came here
to work. Until after the first re-
!. turns are filed next March, Dis
trict officials will have no precise
. figures as to how many residents
this legal definition will exempt, or
exactly how much the personal in
come tax will yield.
Officials believe they can make a
fairly accurate forecast of So 100000
as the probable yield this year from
the S per cent corporation net in
come tax, also adopted as a new
feature of the local revenue struca
ture at the last session. When tho
tax law was being written in July
they figured the personal income
tax would bring in about $500 900
this fiscal year. After further study
they have raised this estimate to
100000.
Increase Next Year.
For the next fiscal year, 1941,
they believe the personal income
tax win be producing S1,2O0,0OO, and
the corporation income levy, 81, AGO.
900. With the adoption of these new
tax sources last July, Congress
dropped the business privilege gross
receipts tax and repealed the in
tangible personal tax
The passage of the current tax
law marked the third time in as
many years that Congress rewrote
the local revenue structure, and
District officials are known to be
anxious to keep the 1941 budget at
level that will make another tax
measure unnecessary in the January
session.
AS the budget approached COM
pletion, the Commissioners yester-
day decided on only comparatively
small increase over this years ap-
preparation in the total allotment
for public school needs. The origi-
nal school estimates amounted to
Sl8,775,000. Without revealing the
extent to which this total was re-
duced, District officials are under
stood to have given school authori-
ties maximum figure within which
-. adjustments must be made in the