Evening star., 1940-02-28
Sliding Job Tax,
Fixed Reserve
Plan Urged
Levy Would Be Varied
As Fund Rose or Fell
From Its Set Level
BY DON S. WARREN.

OoC "a q oA4uAIlS SCdFc IAA pldIl
by which the District fund for pay
ment Of unemployment benefits to
the eligible jobless would be main
tanned at $l0,000,000 to $4,000, 600
was suggested today by employer
groups as a feature Of the Districts
unemployment compensation system.
This proposal. together with a
plan for use Of an employer ex-
perience rating in the operation
Of the jobless insurance law, was
scheduled for consideration at q
meeting this afternoon between
Representatives of the Districts
Unemployment Compensation Board
and employers.
Under the proposed sliding scale
tax plan. the D. U. c. Board would
be directed to make an increase in
the fiat rate pay roll tax should
the benefit reserves fall below $10,-
100000 and for q decrease in the
tax should the fund raise above
$4,000, 900, the purpose being to
maintain the reserves at between
the two figures.
Rating Plan.
The employer experience rating
plan, which would provide for q
lowering of the pay roll tax rate
for the individual employer accord
ingly as he maintains stability Of
employment for his workers, is
being perfected by officials of the
Board of Trade, the Merchants
and Manufacturers Association and
other business organizations, which
are urging that the plan be given q
definite early trial in the District.
In the current intensive studies Of
proposed revisions of the present
act, there has been general agree
ment that the Districts pay roll
tax rate of 3 per cent, now the high
est in the country, should be re-
duced to a. per cent, the level adopt
ed by most States; that the tax
should be applied only to the first
5000 Of any salary. which is the
new Federal policy, ana that bene-
fits paid to the eligible jobless
should be increased.
Board of Trade ofIicials have
found, however. that even under this
sort Of q new program. the District
still would be collecting roughly
twice as much in taxes each year as
the anticipated total benefits to be
paid out.
Adjustment Of Tax.
The present act contains an ex-
perience rating plan which Is to go
into effect next January. It permits
an adjustment Of the tax between
IL per cent to per cent for en-
ployers, according to their employ
ment experience. The pending Nc
Gehee bill calls for further study Of
the rating plan. Washington busi-
ness spokesmen are urging inclusion
in the McGehee bill Of a new ex-
perience rating plan, modelled after
those in the laws of Texas, Della
ware, Illinois and Massachusetts.
Their plan would permit adjustment
of the pay roll tax rates, according
to employment stability experience,
to low of II Of l per cent to 2.7
per cent.
For the operation of such system,
the Board of Trade and other groups
are prepared to suggest a formula
and stated mathematical table by
which to apply the formula. in order
to simplify the use of the system.
The contribution rate for individual
employers would be determined by
two factors: The employers benefit
wage ratio and the Districts over
all experience.
The employers benefit wage would
be the total of the wages he had paid
to workers who subsequently lost
their jobs and became eligible for
benefit payments. This would be
figured over three-year period.
The District. experience factor
would be determined by dividing the
total amount of benefits paid to all
unemployed workers by the total
benefit wages" of all employers for
the same period. The pay roll tax
rate to be found for the individual
employer would be arrived at by
multiplying the ratios found in the
two factors.