(Update to D.C. in Violation! ) ††††††††††† Where Your Federal Tax Goes

 

Can we afford toÖ

††††††††††† * Fix our schools, restore programs and faculty to UDC?

††††††††††† * Restore and expand our gutted safety net for our children, poor, disabled and elderly?

††††††††††† * Provide health coverage for all presently uninsured residents (over 80,000)?

††††††††††† Have we been misled when our politicians tell us the District just doesn't have the tax base to meet these basic needs of our residents?

††††††††††† To be sure we richly deserve the now removed federal payment (some $1.8 billion per year) and the hundreds of $millions from a future reciprocal income tax with surrounding jurisdictions, but until we get full self-determination and statehood we can and should tap the more than adequate tax base of our wealthiest residents, who now pay lower rates in local taxes than low and middle income taxpayers.

††††††††††† Since 1994, over $100 million/year in hurtful budget cuts have been forced by DC government/Control Board. These cuts in our safety net for our children, poor, disabled and elderly have included reductions in homeless shelter space and drug treatment programs, elimination of emergency assistance and the Tenant Assistance Program. At least 39% of our children are living in poverty because the TANF benefit with entitlements is below the federal poverty level (the figure may well be as high as 60% if children in low income families not receiving welfare are included; DC Action for Children, 1999). We all support efforts to bring able-bodied people into the workforce as productive members.While the Mayor has spoken about private-public partnership to facilitate this transition, we have not yet heard a commitment from him or the Council to raise the benefit level of welfare recipients above the poverty level, nor have seen proposals to insure an adequate level of support for their entry into the workforce at a living wage, with full provision of child care and educational opportunities.

††††††††††† Our present local tax structure is regressive. While their taxable income has been booming, the wealthy continue to pay a smaller percentage of their income in local taxes than do low and middle income brackets. The tax cut legislation passed by the Council last spring will continue this pattern of regressivity. The top 20% income bracket (average income greater than $89,300) will get 58% of the total tax cut.

††††††††††† This year, DC residents making over $100,000 have an estimated taxable income of over $6 billion (source: projected from IRS statistics), and this does not include income of tax cheaters who fraudulently claim residence outside the District. For those making over $200,000 the estimate is $5 billion; a mere 2% increase in taxation of their income would generate $100 million in revenue a year for the District!(And they would get back a portion in the federal deduction offset). This would insure both real tax relief for low/middle income residents and the guarantee of increased revenues to fix our schools and restore and expand our safety net.

Will higher taxes on the wealthy erode our tax base?

††††††††††† Hardly likely. The wealthy have been steadily moving into the District in the last decade, despite the lower tax rates of suburban Maryland and especially Virginia. DC taxpayers, in the greater than $100,000 bracket, increased from 12,000 to 20,000 in a decade (IRS statistics).It is absurd to argue that wealthy DC residents will leave the District if they are required to pay slightly higher rates, given the advantages of living here, namely lower commuting costs and time, cultural opportunities etc.Who will buy their high-priced homes if they move? And if a small number do move, lets encourage the conversion of these large homes to apartments.Lower tax rates on low/middle income residents will in contrast encourage them to move back into the District, reversing the trend of the last decade.Reducing the income gap and "misery index" in the District would benefit the wealthy as well as everyone else by reducing crime, stimulating consumer spending and reducing class/racial polarization, improving the quality of life of all, whatever their income or neighborhood.††

††††††††††† We are fully empowered under the Home Rule Charter to revise our own tax code to guarantee the necessary revenue to meet basic human needs.Lets fight for a District tax-restructuring plan that reduces the income gap.Yes, such legislation would also require Congressional approval, until we achieve our full democratic rights under statehood.While voting representation in Congress is long overdue, only statehood will insure local budgetary control.Up to now our City Council and Mayor have approved austerity budgets recommended by the Control Board.Isn't it time for our elected officials to change course and stand up for our most vulnerable residents as well as providing tax relief for low and middle income residents? And if they donít, why not consider electing people who would?

DC Statehood Green Party

Websites:www.dcstatehood.org 561-6068, 546-0940