Evening star., 1949-03-09
House Unit Sets
New Sales Tax
Test Tomorrow !
Fight Predicted on
Broader Bill With
Levy on Incomes
By Don S. Warren

The first test of the broadened
2 per cent sales tax plan for
filling gaping holes in this city's
finances will come tomorrow at
special meeting of the House
District Committee.
The extra session was called by
Chairman Mcmillan to speed a
decision on the big new tax bill
so that it can be carried to the
House for action next Monday
District Day.
A fight over the combination
sales and income tax bill, drafted
by a joint House-Senate Fiscal
Subcommittee and introduced
yesterday. is predicted.
Sales tax opponents say the
fight will be made first in the
full House District Committee and
later on the House floor. Sup
porters of the plan. anticipating
full committee approval, are ask
ing what other sources Congress
would be willing to tap for ad-
ditional money.
Two Uncertainties.
Exact calculations of what the
present version of the new revenue
measure would produce were lack
ing, since there are uncertainties
in at least two of the tax sections.
The expected increase on a full
years basis ranges from roughly
$16,000,000 to about $18,0OO,00O.
Neither of these estimates in
cluded either a Federal payment
boost or adoption of the proposed
doubling of liquor taxes.
The fight within the District
Committee against any form of
sales tax will be led by Repre-
sentative Klein. Democrat, of New
York, a New Dealer, who declares
any sales levy bears too heavily on
the poor. He is pushing for
substitute that would apply the
city income tax to all persons
actually living here and would
boost its tax rates.
Representative Smith, Demo-
crat, of Virginia, chairman of the
House District Fiscal Subcommit-
tee, and Representative Bates, Re-
publican, of Massachusetts,, rank
ing Republican committeeman,
and others. will defend the sales
tax-revised income levy.
Needed Projects at Stake.
1--WE now. are confronted with
situation in which we either
provide the revenues or go without
services and projects for which
there is crying need" said Mr..
Smith.
If the District budget needs
are met and if the necessary $40.
100000 is provided to permit the
delayed pay raise for the city
government employees, which
should have been granted last
year. then we have got to find
the money"
He argued it is futile to suggest
that the United States cover the
need by a huge increase in the
Federal payment, or to depend on
a move to extend the city income
levy to all living in Washington.
1--WE have tried both those"
said Mr.. Smith, and failed
Chairman Mcmillan indicated
he was taken by surprise on the
recommendation that the pro-
posed sales tax be applied to
medicines. In earlier sales tax
bills medicines as we'll as
groceries have been exempted.
Because he heads the full COM
mittee Mr.. Mcmillan declined to
outline his stand.
He did say he hoped pending
bills for $3.50 pay raises for Dis
trict police. fireman and teachers
will be given final action by the
District Committee tomorrow. He
expects committee approval.
Representative Jones, Democrat.
of Alabama, member of the fiscal
subcommittee, favors the sales tax
plan but will insist on an increase
in the Federal payment and boost
in city liquor taXes-both left out
of the new revenue bill. District
liquor taxes. he said, are the low
est in the Nation.