Evening star., 1939-04-09
Tax Experts May
Fix Real Estate
Rate at $3.50
House Subcommittee
To Sturt Revision
Study This Week

Possibility that the real estate tax
rate may be reduced in the next
fiscal year from SITS to $1.50 was
raised yesterday by municipal tax
experts as they planned revision Of
the District tax structure in the
light of the reduced 1910 budget as
passed by the House.
One official estimated it would
be possible to make a $4,000, 900 cut
in realty taxes as we'll as to abandon
the unpopular business privilege and
intangible personal property taxes,
If Congress approved the substitu-
ton OF combination of four pro-
posed new measures, calculated to
bring in some $6,4000OO.
These would be a personal income
tax on salaries of more than $4,000,
a per cent fiat rate income tax on
corporations, a per cent sales tax
with but few exemptions and re-
vision OF taxes on public utilities
expected to produce some 100000
more year. In addition to these
there is pending proposal for adop-
ton Of gift tax for the District.
Tackle Issues This Week.
Members Of the Nichols subcom-
mittee of the House District Com
mittee are expected to come to grips
this week with the issue of whether
or how to revise the District tax
structure and to plan a more or less
long-range program to meet District
budget needs for several years to
come.
Restrictions of the 1910 appro-
priations to some S47,OOOyOOO, rs
provided in the supply bill passed
last week by the House, indicated
that virtually no increase in reve-
nues would be required for the next
fiscal year if the SITS realty rate
were continued. However some Of
flcials insist this does not solve the
faults of the present tax structure
nor meet the almost certain" rise
to be expected in budgets in future
years.
The new tax suggestions do not
consider, either, the effect of the
Overton fiscal formula, which would
call for an increased Federal pay
ment, eliminating any early need
for an increased tax burden.
The proposed sales tax plan. orig
inally based on per cent tax. it
was revealed, is being revised to
call for per cent rate. with no
price exemption level and calling
for the use of metal tokens on the
mill basis. The committee print"
OF the proposed new tax program,
it was understood, is being revised
to this end by 10 v. Morgan. sole
member of the District Board of
Tax Appeals, as a result of a meet
ing last week of members of the
Commissioners Advisory Tax Com
mittee. Two members of the COM
mittee still are said to be opposed
to the sales tax plan in any form.
Proposed Income Tax Change.
A change also is being made in
the proposed income tax on salaries
Of $4,000 or more. aside from drop
ping the tax level from $4,000 to
$4,000. 1t was said the latest re-
vision of this portion of this pro-
posed measure would class as non
residents" those persons actually
| living here who claim legal or vot-
ing residence in the States. Since
they make their salaries in the Dis
trict, they would be subject to the
income tax, but only with the grant,
ing of deductions for the amount
OF State income taxes they may
pay in their claimed legal resi-
dence. Such credits would be al
lowed only if the State had a re-
clprocal arrangement and provided
also that tax payment deductions
could not be made for payments
both in the District and in the
State.
AS to the proposed per cent
sales tax, it is proposed that sale
OF products to the Federal and Dis
trlct governments would be ex-
empt, that food for human con-
sumption off the premises where
sold likewise would be exempt from
the tax, but that food served at
restaurants and other eating places
would not be exempt. Purchases
OF gasoline and motor oil also
would be exempt. on the ground
that they already are subject to
importation taxes.
Here is the way the fiscal situa-
ton shapes up: AS the House
passed the 1910 District supply bill
there are charges against the gen.
eral fund (that is, not counting
motor vehicles or water revenues)
of $39,356, 900. plus some $1,000 900
carried in other bills for the courts
and hospitals. Added to this is
an expected deficit of some $198 900
at the end of this fiscal year, max
ing total of nearly Sal 100000.
Expected District revenues next
fiscal year from the present tax
structure, allowing for the automatic
dropping of the business privilege
levy and counting on a s15O realty
and tangible personal tax rate, are
(See TAX RATE, Page B-3.)