Evening star., 1947-07-27
RevenueReView
In D. {. Seems
Certain in '48
Cain Offers Bill to
Repeal Individual
Income Tax Here

A general review of the Districts
revenue problem early in the next
session of Congress appeared certain
last night. sasAl
Senator Cain, Republican of
Washington, heading the fiscal sub
committee of the Senate District
Committee, introduced bill yester-
day to repeal the individual income
tax section of the new District
revenue act. charging that it was SO
discriminatory in its application as
to be vicious and perhaps unconsti-
tutional.
With Congress about to adjourn,
he was looking to consideration OF
the problem at the next session.
Plans Full Review.
Shortly after he introduced the
bill, Chairman Bates of the fiscal
subcommittee of the House District
Committee announced plans for a
full review of the whole revenue pic
ture early in the next session, since
Congress had approved the biggest
city supply bill in history which, he
said, had upset the apple cart" as
to revenues as viewed by Congress
when it enacted the 1947 revenue
bill.
Senator Cain, in a statement when
he introduced his individual income
tax repeal bill, directed his fire par
ticularly at the provisions in the
income tax law which eXempts the
Federal pay of Government work
ers who claim they are taxable in
their home States. He protested that
this permits about 40 per cent of
District residents to enjoy District
services to which they contribute
nothing.
Mr.. Bates, a coauthor with Sen
ator Cain of the new revenue. act,
disagreed with Senator Gains argu-
ments. He said, however. it was
obvious" that if the present rev.
enue program did not provide suffi-
cient revenue to meet District re-
quirementS 1T would be necessary
to re-exanine the whole revenue
structure"
Experience Will Tell
Mr.. Bates contended that only
experience will tell" whether the
recently enacted program will pro-
vide sufficient revenues.
He said that he thought expanded
revenues must be provided. if the
District was to go ahead with the
Capital improvement program as
now proposed for the public schools
and other, services, but he had
doubts as to thss ssize of some ef these
For this reason he said that he
would advocate a, congressional
study of the prografn. with4special
attention to new schools. ~5Such &
study. Mr.. Bates said, would be sup
ported by District taxpayers be-
cause, he said, they would set up a
loud cry of protest when they
realized how much more taxes they
will have to pay under the new rev.
enue act just now going into force.
Sales Tax Expected.
Adoption of general sales tax is
expected to be proposed in consid-
eraticn of any revision of the pres
ent revenue plan.
Senator Cain. in proposing repeal
of the present individual income tax
law, has not yet committed himself
to any substitute revenue measure,
but he has described a general sales
tax as ''one CT the most likely sub
StituteS."
In connection with his attack or
present income tax exemptions
Senator Cain declared there wer'
approximately 225000 Federal EN-
ployeS living in the District.
His bill, while calling for the re.
peal of the individual income levy
would leave intact the income ta>
on corporations and unincorporatee
businesses.
Bill Called Simple Justice.
The justification for this bill" hs
said, lis simple justice. There car
be no possible justification for eX-
empting groups of citizens from
their responsibility to a community
in which they live.
IF it is proper for some citizens
to contribute to the needs of theil
community by paying, an incom.
tax, it is proper that all citizens
should pay their proportionate share
of the local tax burden.
This is not possible under the
District Income Tax Act of 1947
This act is constructed on thu
premise that some should pay TO,
local services which are given fre,
Of charge to others.
I'm the District, about go per cen
OF the citizens will share an incom
tax load which provides essentia
community requirements. About d
per cent of the citizens, merely be
cause they are Federal employees
will benefit from services for which
they pay nothing. This situation i
unreasonable because it is unfair
discriminatory, unduly burdensome
vicious and perhaps unconstitu
ticnal"
Unfairness Is Stressed.
He said his bill is designed to rec
ognize "an acknowledged injustice.
He added IF all taxpayers aren'
going to pay their fair share of al
income tax in our Federal City
then no individual citizen should b
required or expected to pay all in
come tax"
Senator Cain estimated that tn
individual income levy produce
about 5000, 900 a year, which woult
have to be replaced by some othe
measure. He expressed hope tina
other Senators would study the sit
uation and recognize the inequalit
and inequity of the present situa
ton
'When this sorry state is full
realized and understood, he con
cluded. at will then be possible t.
establish a tax base which demand
ar. equality of sacrifice. In no othe
III