Evening star., 1949-02-18
ID. {. Sales Tax,
Doubled Liquor
|LeWPass Test
Capitol Committees
Joint Fiscal Group
Approves Proposals

Tie house ana senate DlSCr1cE
Committees today approved in
principle the levying of a 2 per
cent retail sales tax as part of the
city's deflcit-avoiding revenue
plan.
The group unanimously ap-
proved the proposals of the Com
missioners to double the city's
taxes on liquor and beer and to
double the license fees.
This increase in the taxes on the
liquor industry is expected to
bring in an additional $3,100, 900
year.
Another unanimous action by
the joint subcommittee was to
eliminate from further considers
ton in this revenue measure any
increase in the Districts real es-
tate and tangible personal prop.
erty tax rate.
Another Session Next Week.
Some witnesses before the COM
mittee at hearings this week had
suggested some increases in the
realty tax as means of avoiding
the proposed sales levy.
The joint group, meeting In
executive session. is taking up the
revenue bill proposals one at q
time. 1t did not finish its work
today and another session tenta-
lively was planned for next week.
Senator Hunt, Democrat. OF
Wyoming and Representative
Smith, Democrat. of Virginia. the
chairmen of the Senate and House
District Fiscal subcommittee, are
to schedule the next meeting.
Members of both House and Sen
ate groups are anxious to speed
action on the bill, because the Dis
trict budget, soon to be ready for
House action. is out of balance by
about 100000. although many
capital improvement projects were
postponed because of the shortags
of money.
The joint subcommittee has
been told the budget deficit for the
fiscal year beginning July 1 will
rise above $4,000, 900 If Congress,
as expected, passes pay raises for
some 1900 employees and makes
them retroactive to last July I.
when Federal workers won their
raises.
Higher Gallonage Taxes.
| Aside from doubling the various
fees charged for the licensing %
beverage businesses, the plan ap~
proved today would raise the gall
lonage tax on spirits from so cents
to $1.10 gallon, and would in
crease the tax on beer from 50
cents to 81 barrel.
The doubling of the license fees
is estimated to increase revenues
from $500, 900 year to 81 500, 900.
The remainder of the extra So
100000 in liquor taxes would come
from the higher rates on spirits
and beer.
The subcommittee has not An
ished its examination Of the sales
tax portion of the bill. Items on
which any subcommittee member
has questions were passed over
for later decision. Chairman
Hunt said the group had not yet
decided what exemptions from the
sales levy should be put in the bill.
Senator Hunt pointed out that
decisions so far reached do not, an
yet, represent the conclusions OF
the full House and Senate District
Committees. ".~
Income Tax Not Studied Yet.
Among items not yet reached by
the joint group are proposals for
the revision of the Districts in-
come tax or the proposed $4,000
900 increase in the Federal pay.
ment toward District costs.
The income tax section of the
proposed bill would broaden the
base by making it apply to all
persons maintaining an abode IN
the District seven months or more
of the year, as we'll as to persons
"domiciled" here. and would raise
the basic exemption to either
$4,000 or $8,000-depending on
which of two proposals is adopted.
Members of the Joint subcom-
mittee attending the session in
addition to the co-chairmen were
Senator Frear, Democrat. of Dela-
ware. and Representatives Jones
of Alabama and Jones of Mis-
souri,. Democrats. and Tale Of
Iowa. Republican.
Meanwhile, Representative Bates,
Republican, of Massachusetts plans
to lay before District congressional
leaders proposal to finance
capital Improvements. especially
schools, by Short-term loans.
Believes Sales Tax Necessary.
He has come to the conclusion.
he said, that the city could we'll
begin borrowing. preferably from
the United States Treasury, to
provide public facilities needed by
the larger population of the
Capital.
Among financing to be consid-
cred along this line. it is believed.
would be a 10-year bond issue to
help carry costs of school con-
recommended by the
Strayer report on the poor physi-
cal condition of the school system.
Mr.. Bates, a member of the