Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-02-02
District Officials
Look for New
Source Of Taxes
Capitol Hill Unit
Asks Study to Boost
Works Financing
By George Beveridqe

District officials today began
a wide range of new tax studies,
amid suggestions that local taxes
may have to be raised beyond the
$40 million mark proposed by
the Commissioners to help f.
nance the city's $305 million
public works program.
The studies. requested by a
House Senate subcommittee
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How Washington Differs From Other
Cities. Text on Pose A-3
smoIIer stotes Shown as Getting More
U. S. Funds Than D. c. Pooe A-3
working over the financing pro-
posals, ask how much money
would be produced by a myriad
of new tax possibilities left un-
touched by the city heads.
Heaviest emphasis. during
questioning of District Finance
Officer James L. Martin at an
open hearing yesterday, CEN
tered on extension of the sales
tax.
Among possibilities members
asked about were increasing the
sales tax from 2 to. 3 per cent.
extending it to cover groceries,
eliminating the $1.25 exemp-
ton on meals and cutting the
tax exemption from is to 10
cents.
Beyond that, their interest ex-
tended to higher taxes on real
estate. transient hotel rooms and
banks. possible removal of a
tax-exemption given insurance
companies on interest from mort
gage investments. and lower ex-
emptions on individual income
taxes.
Martin Fears for Business.
Mr.. Martin argued strongly
against the sales tax suggestions,
on grounds that they would
chase business from the District
to suburban shopping centers.
He also urged against real estate
tax changes beyond the orderly
reaSsessmentS on which his Office
is working.
He did, however. propose one
new tax boost of his own-ex-
tending the unincorporated BUSH
ness tax to include such profess
sional men as doctors, lawyers
and architects. He said this.
coupled with other notifications,
would raise SIS million a year.
subcommittee Chairm a n
O'Hara said he hoped to have
the new data by tomorrow and
begin closed-door sessions with
the city heads Thursday or
Friday.
Mr.. O'Hara stressed that none
Of the new tax possibilities specu-
lated on yesterday have any
formal standing. 1t was evident
that the subcommittee wants to
go over virtually the city's entire
tax structure with a flne-toothed
comb.
Part of Financing.
The $40 million in tax in
creases are only one part of the
works financing plan submitted
by the Commissioners. They also
are asking a SO million annual
raise in the Federal payment
and Federal interest-bearing
loans totaling about Sill mil
lion for the 10-year period. Thus
far, the subcommittee has given
little attention to the loans, and
members have stressed that the
case for higher Federal pay
ment will be brighter if it can
be shown that local taxes are
on the soundest possible basis.
The Commissioners, in a sepa-
rate move yesterday, however,
submitted a six-page statement
documenting point-by-point rea-
sons for a higher Federal pay
ment. It stressed that the Dis
trlct is deprived of revenue which
other cities get, and spelled out
the high burdens the Federal
City places on local taxpayers
The subcommittee, meanwhile.
evidenced a dual interest in
looking at new tax revenue
sources. On the one hand, mem
bers clearly dislike some of the
Commissioners taxi ase
proposals. At the same time.
they questioned whether $40
million in taxes is enough to
sell the entire program to the
House and Senate.
Members obviously are wor.
(See WORKS. Page A-3)