Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-02-18
Doubled D. {. Tax
Increase Proposed
To Pay for Works
Continued From First Page,


boosts proposed on beer and
auto registrations.
4. Retained the proposed SO
million annual increase in Fed
eral payment, raising amount
of the payment to $40 million a
year.
S. Provided that any Federal
payment money in excess Of
$15.5 million be earmarked spe-
officially for expenditure on pub
lie works, on the condition that
a like amount be earmarked
from District revenues each year
for works projects.
The bill resulted from days OF
closed-door discussion between
the subcommittee and city Of
flcials. 1t had been expected gen.
orally that the Commissioners
water, sewer and highway pro-
posals would be accepted. since
they involve self-sustaining
funds.
But it has been a foregone
conclusion that the general fund
proposals were in for drastic
change. Two main factors were
involved in the decision to in
crease taxes and eliminate the
proposed $40 million loan.
One, subcommittee members
said. was to save interest and
hold the general fund to a pay
as-you-go basis. The other was
a feeling that the Federal pay
ment increase would be more
palatable to Congress if taxes
were raised substantially.
Closes Revenue Gap.
The tax increase also takes
care Of a $1-million-a-year gap
between the city heads new rev.
enue proposals and estimated
cost of the works job.
Mr.. O'Hara said the new bill
would permit both District Com
mitteeS to assure House and
Senate members that District
taxpayers are doing their full
job"
Another member, who asked
that he not be named, said the
bill is the direct result of IAN
attempt not to soak anyone too
much. to spread the burden
around and get the program
through Congress"
In other than the general
fund. the works bill calls for
higher water rates, a new sewer
tax equal to about half the new
water bills and a 1-cent raise in
the gasoline tax. The Federal
government, under the plan,
would pay for all the water it
uses and also pay the sewer levy.
These increases amount to about
SIS million a year. Coupled with
the $9.4 million general fund
tax boosts. they would bring the
District taxpayers burden up to
nearly SIS million year.
General Fund Changes.
Following is a complete tabu-
lation of the general fund
changes. to increase revenues by
$9.4 million:
/. Establish an auto registra-
ton fiat fee of $22 for cars
below a weight of $500 pounds,
and $32 above that weight. to
produce $3,850,000 a year. The
Commissioners proposed f1at-fee
charges of $40 and $50. These
revenues would be more than
offset by repeal of the personal
property tax, which between
them now yield SAL million a
year
2. Increase taxes on whisky
(from IS cents a gallon to SD
and wine from Is to 20 cents
to produce Sill million more. No
change from Commissioners
proposal.
3. Increase the tax on beer
from 81 to SITS per barrel.
yielding $435,000. The city
heads proposed a raise to So.
4. Increase the cigarette tax
/ cent a pack to yield $3.50. 900.
No change from Commissioners
proposal.
) 5. Increase individual income
taxes / per cent in each taxable
income bracket to produce SIS
million. No change from Com
missioners' proposal.
Increases Bus Tax.
8. Increase bus mileage tax
from 8 mills to 2 cents a mile
for suburban lines operating in
the city, yielding $4,000. Capt.
tai Transit Co. taxes would be
revised with no change in rev.
enue yield. No change from
Commissioners proposal.
7. Reduce the sales tax
exemption on meals from $1.25
to so cents to yield SIS million.
Not proposed by Commissioners.
8. Increase sales tax on
transient hotel rooms from 2 to
3 per cent to produce 100000
more. Not proposed by Com
missionerS.
9. Increase real estate tax by
5 cents to produce 100000 ad-
ditional. Not proposed by Com
missionerS.
10. Impose new / per cent
sales tax on groceries to produce
$3.5 million. Not proposed by
Commissioners.
IL. Transfer rental vault
taxes to the highway fund, with
a loss to the general fund OF
$4,000. Recommended by the
Commissioners.
It was learned from subcom-
mittee sources that the Com
missioners stuck by their plea
for only q $4.5 million tax raise
and the $40 million Federal loan
up to the last minute.
Asked to comment on the bill,