Norton Files New Tax Relief Bill For City that Must Pay by the 18th - April 14, 2006

Norton Files New Tax Relief Bill For City that Must Pay by the 18th
Despite Denial of Voting Rights

April 14, 2006

Washington, DC--Today, on the day D.C. residents are preparing to pay taxes without representation, Congresswoman Eleanor Holmes Norton (D-DC) said that when Congress returns from spring recess, the first bill she will introduce will be the District of Columbia Tax Incentives Improvement Act of 2006. The legislation builds on and adds to federal tax incentives she first got through Congress in 1997 in order to help produce residential and business stability and growth. Norton said, "These D.C.-only tax credits have outperformed the city's highest hopes, with a renewed and replenished residential and business tax base to show for it. However, the District's Chief Financial Officer says this growth cannot continue without this or a similar stimuli or assistance to make up for the fact that the District is not a state."

The new important version of the tax credits bill raises the $5,000 homebuyer credit to $10,000 to help meet sharply increased home prices that are driving many lower middle and middle income taxpayers from the city; targets new neighborhoods; and extends and matches the expiration date to 2009 in conformity with similar credits for other cities (Norton has had to seek reauthorization of these tax breaks almost every year.). Experts say that the D.C. tax incentives are largely responsible for the city's new homebuyers and for maintaining and attracting taxpayers and businesses to the city. The improvements in the bill will be essential if the District is to achieve the 100,000 new residents necessary to sustain its stability, according to the former D.C. control board.

Among the most successful incentives to business has been the wage tax credit allowing an employer a 20% credit for the first $15,000 ($3,000) of an employee's wages if that employee is a D.C. resident. This credit has both attracted and retained businesses here and has helped to correct the severe imbalance that allows two-thirds of the jobs in the city to go to commuters.

"This federal tax package has given the District the tools it needed to begin to produce a self-sufficient economy following the financial collapse of the city's economy in 1990's," Norton said. "D.C. residents who are paying their taxes have a message of their own for the federal government that insists on denying them equal citizenship in return. This bill sends the message that, in the absence of other remedies, Congress has a continuing obligation to help the city do what is necessary to help the nation's capital help itself by increasing its own residential and economic output and independence."