Evening star., 1947-02-25
DR.. Pond , Tax Expert
Returns 10 Prescribe
District Sales Levy

UISlnCI 9dleS Levy
A figure in the Districts past tax
history returned here today to pre-
scribe now, as he did in 1889, a
combination sales-income tax for
the city's money-raising troubles.
He is DR.. Chester Pond, New York
tax expert, who made a detailed
study of the District tax structure in
1883 under a $4,000 appropria-
ton by Congress.
DR.. Pond appeared today in a
panel discussion on District finances
sponsored by the Forums Committee
of the Board of Trade at the Wash
ington Hotel. Also taking part were
District Budget Officer Walter L.
Fowler, Assessor Edward A. Dent
and Corporation Counsel Vernon
West-all members of the Commits
sioners' Tax Committee which re-
Gently finished drafting 2 per
cent sales tax for submission to
Congress. The city now has an in
come tax.
Gives Reasons for Sales Tax.
"In 1899, as today DR.. Pond de-
clared, there were very definite
reasons why the retail sales tax was
considered applicable to the Dis
trict."
He said these reasons include:
l. Exemption of sales, of iratangi-
bles. food and medicines thus re-
lieving from taxation much of the
expenditure of the low income
groups.
2. It has an extremely broad base
thus stimulating greater tax con-
sciousness on the part of the tax
paying public.
8. 1t will tap the income of non
residents and transients who can
not now be reachced for their pro
rata share in rising governmental
costs.
Selective Tax Is Alternative.
4. When combined with an in
come tax, the ability to pay prin-
ciple may be said to govern.
S. Often the alternative to a gen.
eral sales tax is a selective tax on
cigarettes and utilities which may
be far less desirable in total.
6. Retail sales taxation is prefer
able to an income tax on wages and
salaries which combined with the
Federal income tax makes a heavy
burden for salaried workers whose
incomes have not gone up as rapidly
as prices.
7. Once established, it is easy to
collect. Taxpayer resistance to any
new tax is formidable, especially in
early stages, and the sales tax is no
exception to this.
8. Since the tax is on spending, 1t
will encourage savings.
9. Because the District lacks heavy
industry as a tax source, it must
rely more on personal income and
retail sales taxes than do most
municipalities.
Admits Limitation of Plan.
DR.. Pond admitted there were
limitations to the sales tax such
as the "regressive" factor of taking
a larger percentage of the poor
mans income than rich mans. He
also referred to the problem of loss
of business to the surrounding
counties.
The tax expert, however, felt the
advantages of the levy here out
weigh the disadvantages and
pointed to the prospect of sales
levies in the adjacent counties as
a sedative for business fears.
Half the States and many cities
now use the sales tax as revenue
raiser, he said, and there is every
evidence of continued spread.
Would Increase Revenue.
He expressed the opinion that the
tax would bring to the District 8
substantial amount of revenue from
source which is a growing anC
integral part of the American ta1
scene"
Under the Districts new tax pro-
gram now in the hands of the
Budget Bureau, the sales tax is esti.
mated to yield 100000 of a tota
of $17,750,000 for the whole program
The remainder of the program in
cludes many selective sales taxes
such as those DR.. Pond mentioned
on cigarettes, utilities and gasoline.
Key members of Congress as vel
as District officials and members o1
the Board were on hand for the
forum under the Craftsmanship Of
ICar1 r Purk1and