Evening star., 1939-01-07

Dy -. ~ AAEfNkNAs
The fact that this Congress will
attempt to write q permanent new
tax program to be borne by the local
community is one Of the strongest
reasons why it should heed the sug-
gestion of Senator Overton, Demo-
crat. Of Louisiana, and lay down also
some permanent, definite yardstick
for determining how much is to be
borne by the Federal Government.
II it succeeds in drafting a per-
manent rather than another tempo
rary tax law, and does not at the
same time settle the fiscal relations
issue, Congress would be fixing the
obligation of District residents for
an indefinite period, while leaving
the Federal partner free from any
fixed obligation under the policy of
arbitrary lump-sum payment. which
Is made for one year at time.
Two Extra Loads Imposed.
Under the lump-sum policy, which
Senator Overton believes should be
replaced by some definite yardstick
formula. the Federal payment has
gone down from $500, 900 in 1892 to
5000 900 this year, while the total
required to run the city has gone
up from 81, I'll ,638 in 1892 to S48,-
$4,000 this year. In other words.
while the Federal Government has
cut $4,500,000 from its share, the
total to be met has increased by
approximately $2,700,0O0. And the
expenditure figure for this wear is
not nnal. Deficiency appropriations
curing the new session may run the
total for the current fiscal year up
nearly to $40, ,000, 900 by June.
This double-barreled increase in
District obigation-from a shrink
ing Federal payment and mounting
nudget-brought the city finances to
the point that made necessary new
and added tax burdens in 1897
and 1898.
II these two temporary tax hills
are followed by q permanent neu
revenue law this winter, without any
cnange IN the lump sum practice OF
Feoefal payment, the silent, unrep-
resented local partner in the deyel-
opment or the National Capital will
pe exposed to q continuation of th.
Trend OF the last seven years toward
placing more and more of tn. nos,
on the District. ''
u. 5. Share 10 Per Cent.
Even If the lump sum navme,t
remained at the present IS 600 ON
hgure Tor the next fiscal year il
Nouia ne only los per cent of the
pending budget total, and would
represent a still lower percentage #
appropriations should be incres sed
IN the immediate future.
A part of the 1887 tax bill made
permanent additions to the District
tax structure, in the form of an
automobile weight tax and the locai
inheritance levy. Not counting
tnese leVles. the 1897 law placed ar
aoded tax burden on local residents
OF about s4,800,000 in a Temporary
increase in the real estate rate
coupled with the business privilege
gross receipts tax.
For the current year the 2h-ceni
ooost IN the real estate rate and q
moolf1ed business privilege lew were
continued, with instructions to local
ana congressional tax experts to
work out a permanent tax program
lor consideration during the 1899
session. "''
Safeguard Withdrawn.
The definite percentaoe has;s
unoer which the city was deyeloned
from 1873 to 1924, along appronriate
hnes 1or a National Capital, safe
guarded local residents against be-
ing saddled with an unfair share
OF the expense. Experience with
tne lump sum practice since 1925
mas demonstrated the wisdom of a
iixeo ratio as a means Of preventing
nequlty IN the partnership.
Even before the new tax 1ev;es
became necessary in 1887 smokes
men Tor organized Washington re-
peatedly had shown in past studies
OF the nscal relations problem that
washington was not undertaxed
when fairly compared with other
cities. and when unusual factors
peculiar to Washington. are taken
into account.
While the scope of the new tax
Dill Is not yet definitely known, it
Will soon be under consideration ir
Congress, and its consideration will
serve to emphasize the need for an
equitable adjustment OF the fiscal
relations question.