Evening star., 1940-09-24
DC. Income Tax
On Residential
Basis Is Asked
Commissioners Urqe
House Committee to
Support Change

Amendment of the District income
tax law, to place the levy on the
basis of residence in the District in
stead of those "domiciled" here on
the last day of the taxable year was
urged on the House District Com
mittee today by the Commissioners
after belatedly obtaining the ap-
proval of the Budget Bureau to
make such recommendations.
The Budget Bureau made clear,
however, that its ruling that the
Commissioners could make their
presentation to Congress did not
commit the Budget Bureau on the
proposed amendments themselves.
After the subject of clarifying the
income tax law had been considered
in the House District Committee, the
Commissioners last May IA sent to
the Budget Bureau their proposed
report to Congress. A reply was re-
ceived by the Commissioners August
81 In that notice, Director Harold
D. Smith of the Budget Bureau
wrote the Commissioners, You are
advised that there would be no OBJ
lection to its presentation to the
committee, with the understanding
that no commitment would thereby
be made with respect to the relation
ship of the proposed legislation TO
the program of the President"
Fathered by Dirksen.
The bill referred to is the one
which was fathered by Representa-
tive Dirksen. Republican, of Illinois.
an active member of the House
District Committee. After consider
able debate on the point, Represent
ative Nichols, Democrat, of Okla
homa. chairman of the Fiscal Affairs
Subcommittee, announced several
months ago there would be no
further District tax legislation at
this session of Congress.
The Commissioners said that be-
cause the word 'domiciled' was in
capable of exact definition. there
was considerable uncertainty re-
garding the individuals subject to
the act
They said:
Many individuals who reside In the
District. but vote or intend event.
ually to return to one of the States,
apparently recognize a duty to con-
tribute to the support of the local
government and have filed returns
and paid the tax. Other persons
similarly situated have not filed re-
turns nor paid any tax because of
the belief that they are not domi-
ciled in the District. 1t appears
from records of the Bureau of In
ternal Revenue that returns have
not been received from at least 49,
900 individuals residing in the Dis
trict and having taxable income"
Distribution Inequitable.
Amendment of the act, the Com
missioners declared. was needed be-
cause of the obvious difficulties Of
administration and the ineouitable
distribution of the tax burden un-
der the present wording.
The proposed bill would strike out
the words "domiciled in the District
on the last day of the taxable year.
so as to make the tax applicable to
all individuals
Another proposed change would
provide that in the case of any
nonresident individual or corpora
ton gloSs income would include
only the gross income from sources
within the District. The word res
ident' would be defined as an in
dividual domiciled in the District
on the last day of the taxable year
and every individual who, for more
than six months of the taxable
year. maintained a place OF abode
in the District.