Evening star., 1941-03-09
Nonresident
Fight Due
Tomorrow
Bottle in House
Seen Over Filing OF
Modified Returns
By JAMES T.. CHINN.

Representative Dirksen, Repubh-
can, of Illinois, long a champion
of the income tax as revenue rails
ing means for the District, expressed
a fear last night bill scheduled
to be called up in the House to-
morrow to perfect" the existing
income tax law would be, used as a
political football"
Three House members are pre-
pared to oppose the principal pro-
posed change in the law-an amend
ment that would apply the tax to
that portion Of the income earned
here by residents of Maryland and
Virginia and non-residents from
other States who work here.
Since the proposed new tax bill
allows credit for income taxes paid
in the States, non-residents from
81 States who work in the District
are exempt from payment of the
tax because the income taxes they
pay in their respective States are
higher than that in the District.
In the II States which do not have
an income tax, the nonresident
working here would be forced to
pay a District tax on his income.
Those non-residents who would not
have to pay the local tax, however,
would be required to file a modified
tax return to the District and it
is over this particular feature that
a battle on the House floor is antici-
pated.
Oppose Filing of Third Return.
Two members - Representatives
Sasscer of Maryland and Smith Of
Virginia, both Democrats-have an
nounced their intention to ask the
House to revise the bill so as to
avoid the annoyance" of filing Of
a third income tax return by any
of their constituents. They pointed
out that both Maryland and Vir-
ginia taxpayers are required to file
now both Maryland and Virginia
returns on their incomes.
Representative Schultz, member
Of the House District Committee,
announced he would offer an amend
ment to the bill to require that
only an affidavit be filed with the
District tax assessor rather than a
proposed modified tax return-a re-
turn more simple than the one sub
mitted by local residents-to show
that non-residents have paid the
tax in the States.
While discussing the proposed
changes in the local income tax law.
Mr.. Dirksen, who is the ranking
minority member of the House Dis
trict Committee. indicated he is
preparing substitute for the Over
ton formula for fixing the annual
Federal payment toward District
expenses.
Mr.. Dirksen said he is not op-
posed to an increase in the Federal
payment, but he believed adoption
Of the Overton formula might es-
tablish precedent whereby State
and Federal governments would
make a claim on the United States
for contributions for postoffices and
other property it removed from the
tax rolls.
Fair and Adequate Payment.
L am going to put my plan in the
form Of a bill and introduce it in
few days, he declared. 1T will,
l believe, be a fair and ADEQUATE
payment to the District and yet at
the same time protect the Federal
Government from any unjuStified
applications or charges against it
by the States and counties for the
properties that may be located in
these sections"
Mr.. DlrkSen declined to reveal the
details of his proposed plan but said
he had already discussed it briefly
with Commissioner Hazen and Cor
poration Counsel Richmond B.
Keech.
incidentally, the District Commit
tee sent to the House yesterday a
comprehensive report outlining the
proposed changes in the local in
come tax law, which it approved
last Monday by an eight-to-three
record vote. The report said in
part:
The District of Columbia Income
Tax Act imposes a tax upon the
taxable incomes of individuals dom
iciled' in the District of Columbia
on the last day of the taxable year.
Because the word 'domiciled' is in
capable of exact definition, thers
is considerable uncertainty regard
ing individuals subject to the pro-
visions of the act. Many indivld-
ualS who reside in the District but
intend eventually to return to one
OF the States apparently recognize
duty to contribute to the support
of the local government and have
filed returns and paid the tax,
Other persons, similarly situated,
have not filed returns nor paid any
tax because Of the belief that they
are not domiciled in the District.
Records of the Bureau Of Inter-
nal Revenue indicate that more than
(See INCOME TAX, Page B-3)