Evening star., 1940-12-06
ChangekUrged
In D. {. Income
Tax Law
Reciprocal Credits
Needed to Make Levy
Just, OfficioI Says

A change In the Districts income
tax law by which reciprocal credits
are allowed to both residents and
residents for income taxes paid
to any State" is needed to make the
law "just and workable" Glenn
Simmons. assistant corporation
counsel declared today.
Action by Congress on a bill in
troduced last April to amend the
District act. he said. is needed to
eliminate the controversial question
of domicile and impose the tax upon
income of residents and income Of
non-residents earned within the Dis
trict."
He told the National Institute of
Municipal Law Officers, holding its
annual meeting at the Mayflower
Hotel, that despite the probability
Of frequent changes in the law, the
income tax has become a permanent
part Of the District tax system"
Administration Burden Increased.
Imposition Of the tax. on indi-
viduals on the basis Of domicile, he
declared, has increased the burdens
OF administration considerably. A
high percentage of the las, 900 Fed
eral employees stationed in Washing
ton reside within the boundaries OF
the District, he added, and "a SUBJ
stantial majority of such individuals,
after removing to the District, con-
tinue to vote and claim legal resi-
dence' in the various States where
they formerly resided"
Attempts to make factual deter
limitations of domicile "are burden
some and the legal principles" are
as yet unsettled.
The bill introduced last April,
bearing the approval of the District
Commissioners, defines "a resident
as an individual domiciled in the
District on the last day of the tax
able year, or one who for more than
six months of the taxable year
maintains a place of abode in the
District" Mr.. Simmons said, and
the allowance of reciprocal credits
for income taxes paid elsewhere pro-
vides that neither double taxation
nor unfair burdens will result"
New Sources Urged.
A committee report submitted to
the institute today argued that new
sources Of local revenue must be
uncovered Real estate taxes
throughout the United States, it was
said. have reached the diminishing
point.
The institute, meeting at the
Mayflower Hotel, turned aside tenn
porarily from the consideration Of
defense problems which are re-
ceiving major attention during the
three-day meeting, for a general
discussion of tax matters.
In emphasizing the necessity for
a new approach to the tax question,
the committee, headed by John J.
O'Toole. city attorney for San Fran
cisco, said that real estate is no
longer the bulk of the wealth of
this nation"
Shifts to Intangibles.
AT the time the revenue plans
Of our cities were devised" it con-
tinued, real estate was the form
most wealth took, but today
wealth is found in the form of
intangible assets, and in the in
come of citizens-not from real es-
tate but from other sources.
"Cities therefore need to shift
their source of revenue so as to
reach this new form of wealth on
the theory that those most able to
pay the expense of local govern
ment, do so. Income from real es-
tate as such has been on the de-
cline, and the gradual raising of
taxes it must bear has made this
form Of property more and more
undesirable"
In a round-table on defense prob
lens yesterday afternoon some of
the municipal officials declared that
manufacturers in their communi-
ties were complaining that they
feared to take measures to guard
against espionage and sabotage by
employing private policing forces be-
cause of the danger of running afoul
of the National Labor Relations
Board.
The institute was to hear a talk
on the Hatch Act this afternoon by
Harry B. Mitchell, president of the
Civil Service Commission, and the
annual dinner will be held tonight.
The visitors were guests of Elwood
H. Seal, retiring corporation counsel
for the District, at a reception at
the Burning Tree Club last night.