Evening star., 1941-02-28
Local Tax Problems


Howard Smith of Virginia to pro-
posed revisionS of the local income
tax serve to direct attention to one
of the most serious and at the same
time one of the most unSubStantial
obstacles to the working out of a
satisfactory revenue raising plan for
the National Capital.
The proposed changes in the law
seek to overcome the inequitable
consequences of the Court of Appeals
ruling in the Sweeney case by re-
quiring all persons earning their
livelihood in the District to pay an
income tax here unless they actually
reside in one of the States and pay
q tax there, in which case they would
be given a credit for the amount of
the State taX-primary tax allegiance
being to the State.
Representative Smith objects to
this change in purely local revenue
measure on two groundS-f1rst that
it would require his voting constitu-
ents of Virginia who work in the
District to file return here although
they probably would not have to pay
a tax since the rates in Virginia are
higher, and, second, that time
might come when the Districts tax
rate would be raised to point where
Virginians working in the Capital
would have to pay some tax here.
In other words, Mr.. Smith is op-
posed to any change in the District
tax law which might cause some
inconvenience to his voting conStitu-
ents, or possibly subject them to a
tax, regardless of the benefits they
receive from the operation of the
municipal establishment where they
earn their livelihood-such as free
tuition in the public schools.
The Virginia Representative is not
the only member of Congress, how
ever, who puts the interests of his
own voting constituents ahead of the
needs of the voteleSS citizens of the
District Some congressional Repre-
SentativeS from States which have no
income tax are inclined to look
aSkance at an income tax in the Dis
trict which would be applicable to
those of their constituents who work
here but maintain voting residence
back home" And particularly would
these legislators be opposed to any
provision which would relieve District
workers living in nearby Virginia and
Maryland from the necessity of filing
a local tax return if their own con-
stituents were to be required to make
such a return.
A somewhat similar situation also
exists with respect to proposals to
authorize a sales tax for the District.
Among the most vigorous opponents
of this levy in both Houses of Con-
greSS are members in whose home
States some form of sales tax has
been effective for years. These legis-
lators, or some of them, object to
such a tax in the District because
they say they are opposed in princi-
pie to the very tax which their voting
constituents back home have chosen
for themselves.
1t was because of objections such
as these, together with the realiza-
ton that the conditions peculiar to
the District of Columbia make it
almost impossible to devise fair or
workable form of income tax, that
the so-called Pond plan, calling for
a combination sales tax on all arti-
cles except necessities and an in
come tax on earnings in excess of
$4,000, was defeated. And it is the
same objections which, since that
reasonable plan was rejected, have
stood in the way of enactment of
any equitable tax program for the
District. The obvious injustices
which now prevail should convince
members Of Congress that the local
income tax should be applied equally
to all persons earning their liveli-
hood in the District or the tax should
be abolished in favor of more equit-
able substitute.