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Actually my statement was that as far as I can find, states tax income where it is earned. If you work in NYC, you pay income taxes there regardless of where you live. This area is unique because Congress controls the District's ability to levy income taxes and the Congressmen come from Virginia and Maryland. So you're right in that the District is seeking to impose is a "commuter tax." That is because Congress will not allow it to apply an income tax based upon where the income is earned.
Many states have reciprical agreeements with bordering states (i.e. MD with DE,PA,VA,etc). In that case, you only pay taxes to where you live, not where you work.
NY, however, doesn't have one with its neighbors. Workers (who live in NJ) pay NYS taxes and then get a credit to apply for NJ state taxes. They are however exempt from NYC income taxes. NYC benefits somewhat, but NYC traditionally pays more to the state then it gets back.
I guess DC does have a legitimate grip in that it is forced to have reciprical agrements with all 50 states.
However, in issue of fairness. DC does recieve unprecidented federal aid vs. other states. In 2004, the DC government (excluding spending on Museums, federal parks, federal salaries, etc) recieved $7,445 per person from the feds vs. the national average of $1,564 in aid to state and local governments. Obviously some of this is related to security. But, never the less DC comes out far ahead of the game. http://www.taxfoundation.org/files/sr139.pdf (broken link)
Perhaps a compromise could be that DC could start taxing the incomes earned here, but give up its bonus federal aid? I'm not sure how that would affect revenues?
Scroll down 2/3 of the way down the page. You'll see that the DC/MD/VA income tax relationship is hardly unique. Philadelphia, Chicago, Cincinnati...all of them are multi-state metro areas where you pay income taxes where you live.
However, in issue of fairness. DC does recieve unprecidented federal aid vs. other states. In 2004, the DC government (excluding spending on Museums, federal parks, federal salaries, etc) recieved $7,445 per person from the feds vs. the national average of $1,564 in aid to state and local governments. Obviously some of this is related to security. But, never the less DC comes out far ahead of the game. http://www.taxfoundation.org/files/sr139.pdf (broken link)
Perhaps a compromise could be that DC could start taxing the incomes earned here, but give up its bonus federal aid? I'm not sure how that would affect revenues?
The Federal government doesn't pay property taxes to the District. It also imposes huge costs on the District, especially for police.
The Federal government doesn't pay property taxes to the District. It also imposes huge costs on the District, especially for police.
The feds may not directly pay property taxes. But, if you look at the Fed-DC relationship in its totality, DC is a huge net beneficiary. On a per capita basis, the feds pay more to DC than any other city. Plus the feds pay for world class parks, museums, cultural centers.
You could flip the argument around. Would DC be better off if the feds moved all the goverment jobs/ammenities out of the district?
The feds may not directly pay property taxes. But, if you look at the Fed-DC relationship in its totality, DC is a huge net beneficiary. On a per capita basis, the feds pay more to DC than any other city. Plus the feds pay for world class parks, museums, cultural centers.
You could flip the argument around. Would DC be better off if the feds moved all the goverment jobs/ammenities out of the district?
Be careful. A lot of what are counted as federal expenditures in DC go to salaries of federal and contract workers who work in federal buildings, which aren't taxed, and drive home to Virginia or Maryland at the end of the day, so their income isn't taxed by DC. About 80% of DC workforce live outside the district.
drive home to Virginia or Maryland at the end of the day, so their income isn't taxed by DC.
but the owners of the office buildings they work in are taxed by DC - a lot
the city has 353 office buildings with an assessed value over $50 million
the amount of commercial property tax paid to the District by office owners works out to about $3,500 per city household
be careful - the "I hate Whitey let's tax him like crazy" attitude would send the people who work in these officies to Rosslyn, Tyson's and Bethesda, and knock down the assessed value of the buildings in the District in the process
thankfully, the Fenty people know what they're doing and won't let this happen
Even if you look just a the portion that is direct federal government to district government transfer. It worked out to $7,445 per person (vs. $1564 US average). That excludes contractors, salaries for federal workers, federal procurment, etc.
be careful - the "I hate Whitey let's tax him like crazy" attitude would send the people who work in these officies to Rosslyn, Tyson's and Bethesda, and knock down the assessed value of the buildings in the District in the process
thankfully, the Fenty people know what they're doing and won't let this happen
I don't think there is anything racial about it. Some of the biggest supporters of commuter taxes are white NIMBY'ers in Upper NW, who fight residential development tooth and nail and then complain about all the damn commuters fleecing the city.
But, your right. A commuter tax would make for a more interesting Rosslyn skyline.
Even if you look just a the portion that is direct federal government to district government transfer. It worked out to $7,445 per person (vs. $1564 US average). That excludes contractors, salaries for federal workers, federal procurment, etc.
Yeah a lot of that is a payment in lieu of taxes. Those federal employees work in buildings that are untaxed real estate.
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