Evening star., 1939-01-21
The Local Tax Burden

The LocoI Tax Burden
In his discussion of District affairs
at his press conference on Friday the
President made two statements
which are distinctly gratifying to
the people of the District of Colum-
bla. One was that there is a real
need for more money for the Dis
trict and the other was that the
whole problem of District finances
may entail renewed consideration of
the question as to the proper share
OF District expenses which should be
met by the Federal Government.
The President included third
point in his discussion which imme-
diately will be contested by District
taxpayers. That was that the Dis
tricts tax burden should be increased
as the tax burden comparison made
by the Treasury Department in 1885
showed that property owners in
Washington paid lower taxes than
those in cities with which Washing
ton was compared.
That more funds are needed in the
District for necessary expenditures
on public health, public schools,
public library, police protection, etc.,
there is little doubt and it is highly
gratifying that the President agrees.
That renewed consideration must be
given to the question of an adequate
Federal payment TO meet the rapidly
increasing expenses 'of the Capital
City Is also correct and the President
has already offered some encourage
ment by his creation of board
which will study the serious problem
here of the increasing amount Of
property withdrawn from taxation
through Government purchase and
development. This is a factor which
should have important bearing on
the size of the Federal payment.
But it is highly unfortunate that
the President referred to the Treas
ury tax investigation of 1885 as
authority for his contention regard
ing the alleged inadequacy of the
Districts tax burden. It will be re-
called, in the first place, that the
Treasury investigation was admit
tedly inconclusive as to relative tax
burdens and that it left the determi-
nation of a fair Federal payment to
further investigation. That fur
ther investigation was the so-called
Jacobs report, the findings of which
were rather definitely repudiated by
the Congress to which they were
submitted.
The Treasury report borrowed it's
tax comparisons from the Detroit
Bureau of Governmental Research,
whose adjusted tax rate" SUPPOSE
tions (they are not facts) are open
to criticism on many grounds when
used as positive indices of relative
burdens of taxation. Adjusting tax
rates by estimating theoretical ratios
OF assessed to true property valua-
tlons has been pretty thoroughly
discredited as method of comparing
tax burdens Analysis of the Treas
ury report at the time by the Citizens
Joint Committee on Fiscal Relations
between the United States and the
District of Columbia showed that the
premise on which the comparisons
were based reduced some of the
conclusions to an absurdity.
The Treasury report, for instance,
indicated that the tax burden of Min
neapolis was more than twice as
high as the tax burden of Washing
ton and that the tax burden of New
Orleans was almost twice as high as
that of Washington-Minne
and New Orleans being the cities
most closely approximating Wash
1ngton in population. Yet, using ac-
tual mot theoretically figures OBJ
tanned by the Bureau of the Census,
it was shown that the total tax
levy and the total tax levy per capita
IN Washington were greater than
those of Minneapolis or New Orleans.
Other comparisons, using census
figures, showed Washingtons tax
burden high among cities-higher
than it should be when the disabil-
tiles of the tax-paying population
are considered.
Nor should the President forget
that the Treasury report was made
in 1885. What has happened in
Washington with regard to local tax
burden and Federal payment since
1888 is shown briefly in this form:
General fund Federal
taxes. payment.
1888 2s,1s5,e47 $7,967 ,e42
1885 -- 29,135,05O 1885, ,399
1889 (est) 36,400,000 100000 J.,
While local taxes for general fund
use have increased by twenty-three