Evening star., 1942-06-18
McGehee
Continued From First Pase)

tax would depend on the condition
of the reserve, figured on an actu-
arial basis, in relation to prospective
demand Mr.. McGehee estimates
that the District fund would not fall
below healthy" reserve of $40. .000,- :
900 for at least 18 years. if the 0.5 tax
were applied. This reasoning is boil
stored by the experience of the past
year, when disbursements of 2,128,-
329 were the highest On record, and
the fund still showed a gain of nearly
$4,000 900.
The volume Of claims last year was
not as great as in 1910, totaling u.s.
900. as compared to $4,000. The
average payment, however, had in
creased from 1929 to $l283. Even
had the higher rate been applicable
in 1910, the outlay would have been
increased by hardly more than $780,
900. Right now, claims are at about
one-third Of the 1910 level, and John
A. Marshall. executive officer of the
Unemployment Compensation Board
believes that this is rock bottom"
considering the demand for man
power.
Only S8,135, 900 in Benefits.
An overall summary of the opera
ton of the fund is further evidence
of the way in which it is mushroom
ing, The tax collection started jan
uary, 1886. Compensation payments
were begun two years later Since
January l, 1888. the total outlay in
benefit payments has been but So
135,0OO, including $4,000 turned
over to the Railroad Retirement
Board when an independent COM
pensation system was set up for rail
workers.
One of the principal reasons why
the District tax is running so heavy
is the inclusive coverage Of the local
law, which reaches down to employ
ers of but one person. Only in the
State of Washington Is the law of
similar scope Some other States
cover one-employe concerns. but
only where the service Of the in
dividual has been for an extended
period, usually 20 weeks. In the
Capital, a half days employment is
taxable.
AS a general rule, the States fix
a minimum of four TO eight en-
ployes in setting up their compen-
sation systems. The Government
will exempt concerns with less than
eight employees from operation of
the unemployment tax If the State
sees f1t to grant this leeway. But
when the State law goes below this
level, the tax Is applied accordingly.
AS noted above. the District law is
more liberal in this respect than any
State law except Washington.
Under the unemployment taxing
system, the Government applies a
3 per cent tax against employers,
but allows them 80 per cent credit
when they operate according to an
approved State plan. 1t is, conse-
uuently, under this division, that
District employers pay 81 to the
local fund and 03 to the Federal.
Through an 1nadvertence when
the local law was drafted, employers
here were required to pay per cent
to the District and 0.3 to the Gov
ernment after 1888. Qn 1896 and
1887 the rates we're l and 2 per
cent, respectively. Thousands of
dollars were paid out under this ex-
cess rate until 1910 when the District
levy was cut back to-. to conform
to that elsewhere. Whatever the
District rate might become under a
new law, the 03 per cent payment to
the Government would remain con-
stant. as this constitutes the local
contribution to the fund for admin
istering the law.
While the minor tax adjustment
has been the sole change made to
benefit employers, the local plan has
undergone marked improvement
from the labor standpoint. At tpe