Evening star., 1946-09-16
DC. Tax Raise,
.BiggerU.S.Fund
UrgedatHearing
Bourd of Trade and
Federation Cite Need
For s., 900 900 More
Pictures on Page BIZ

Two major civic organizations
today recommended to the Com
missioners a combination of in
creased Federal payment and
expanded taxes to prevent the
District from going some $7,000,-
600 ''in the red" by next July l
in maintaining present munich
pal services.
Testifying at the first public tax
hearing at the District Building
since 1888, spokesmen for the Board
of Trade and the Federation of
Citizens Associations broadly joined
hands in solution for the difficul-
ties, although they differed in few
details.
Former Engineer Commissioner
David McCoach, jr, speaking for the
Board of Trade, told the city heads
that board computations place city
revenue needs at s9,000000 annually
in addition to the sums that present
axes and the Federal payment are
producing.
He called on the Commissioners
to set as their primary" objective
passage of the OMahoney bill link
ing annual Federal payment to
national landholdings here, and
proposed that the difference be
made up through a broadened per-
sonal income tax, 5 per cent tax
on unincorporated businesses and
increased liquor levies.
Lump Sum Formula Asked.
Following him to the witness
table, K. P. Armstrong of the Fed
GRAFTON urged that before any new
forms of taxation are imposed on
District citizens some formula
should be established by law to
require the annual payment by the
National Government to the District
Government of an equitable sum
OF money in lieu of taxes for mu-
nicipal services received by it."
In addition, Mr. Armstrong said
his organization favored income and
liquor tax increases, but opposed the
tax on unincorporated businesses
because such businesses now escap-
ing taxation would be caught in an
extended personal income levy.
While the Board of Trade pro-
posed an alternate program includ-
ing a sales tax. levy ON gross
earnings, or still further increases
in liquor taxes if its original pro-
posal was unacceptable in whole or
in part. the Federation turned
thumbs down on a sales tax and the
other revenue-raising proposals of
the Commissioners special tax COM
mlttee headed by Corporation Coun-
sci Vernon E. West.
80 Groups Wait to Testify.
| About 30 citizen groups were
waiting their turn to testify at
the first public tax hearing at the
District Building since 1898. The
hearing follows by less than a
week submission to the Commits
sloners by their department heads
OF an all-time record sI35 .888. 1875
money requests for the coming year.
In brief preliminary remarks to
the organizations spokesmen Com
missioner John Russell Young
pointed up the impending city
fiscal crisis.
On the basis of present taxes"
he declared, the estimated rev.
enues which would accrue to the
District in the fiscal year Begin
ming next July fall some $1,000, 900
short of providing the necessary
amount to continue in that fiscal
year the present public services now
being rendered the people of the
District
In addition, he said. "there is a
tremendous accumulation" of ur-
gently needed public improvements
necessarily postponed during the
war period, but many of which can
not be deferred much longer.
Gas Tax Boost Not Argued.
Mr.. Young asked the witnesses to
limit their remarks to the proposed
new taxes for the general fund
only, indicating that the proposed
gas tax increase would not be-
argued today.
The broadened income and unin-
corporated business tax proposals
and increases in the liquor levies
were taken from the earlier recon-
mendations of the Commissioners
Special Tax Committee headed by
Mr.. E. West.
other recommendation of the
West Committee included a 2 per
cent sales tax, per cent tax on
utility bills, 1-cent tax on each
package of 20 cigarettes and a 10
per cent tax on ticket prices at
amusement places.
Broadening the income tax was
expected to receive general approval
but liquor interests were understood
to be ready to fight the liquor levy
increases and amusement spokes-
men were believed ready to oppose
the ticket tax.
Gen. McCoach said the OMa-
honey proposal would add $4,000
to the District income in 1948 while
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