Court: No Commuter Tax

It wasn’t too long ago that District Officials thought it might be a good idea to institute a tax on those people who live in Virginia and Maryland and work in the District. Essentially, instead of just hitting us up for 10% of our lunch money, and a good chunk of our Metro fares, they wanted to grab a good 2% of our income here as well. Well, some smart folks picked up the phone and called their lawyers and sued. Today they won a major court battle and the federal appeals court here in DC said in its verdict that the Constitution gives all power pertaining to the federal city to Congress.

Good luck getting that one through, boys. DC’s not the only city with this problem, though, as New York City draws commuting workers from nearby Connecticut and New Jersey and somehow manages to make do without their wallets. Chicago somehow survives without the income of all of the Wisconsin and Indiana people who work in the city. Such it is here. I feel for the city, but I already feel sufficiently taxed without having to pay extra just to work here.

[Update] After local lawyer JW commented on this point, I’d like to clarify a few things from his point of view: The DC Commuter Tax is designed to be neutral effect on those who pay it, ie, the money you pay to DC will be deducted from your state taxes. In addition, the suit was begun by DC residents, not city officials.

5 Comments so far

  1. JW (unregistered) on November 4th, 2005 @ 7:18 pm

    You don’t understand the case at all. I am one of the lawyers for DC residents. Lemme explain things to you so you can see where your rant falls flat.

    First off, those other cities do not have the federal govt. to support. Yes, that’s right. DC has to pay for the federal govt. to live in its borers. We shoulder a disproportionate amt. of the costs associated with supporting the infrastructure necessaary to run the federal govt. because the federal payment — the money paid by the feds as “rent” to DC — is horrifically insufficient. The GAO said as much in an exhaustive report several years ago. Those cities could tax if they wanted — they are not prohibited from doing so like DC is. That is what is unconst. about the whole setup. DC residents are singled out and financially disadvantaged by a Congress in which we have no vote. Sounds pretty unAmerican, huh? It only violates no less than 4 provisions of the Constitution.

    Second (and this is what drives me nuts about people like you who think you understand what DC wants): WE DO NOT WANT TO RAISE TAXES. There would be a 100% tax credit on your federal taxes for the money paid to DC through the non-resident income tax — it is not a commuter tax — a commuter tax is a toll — every news org. in the country fails to understand the distinction.

    Third — WE sued. No “smart folks” sued DC. It seems all the “folks” who chime in on this are very much like you — ignorant as to what is really going on.

    DC will continue this fight in the Supreme Court.


  2. Tom Bridge (unregistered) on November 4th, 2005 @ 7:35 pm

    Thanks for clearing up the issue for me, JW. I did not realize (until I saw the news tonight) that there would be a tax credit on my virginia state taxes. However, I do wonder how you justify further taxation without representation? If a portion of my taxes go to a government for which I have no electoral control, are you seeking to make virginians and marylanders more like the District’s own residents? Why disenfranchise people further?

    I sympathize with the District’s plight, but what I don’t understand is why further disenfranchisment is the answer to the problem. That’s unfortunate, JW. Very unfortunate.


  3. JW (unregistered) on November 4th, 2005 @ 7:49 pm

    I understand the thrust of your last point but there are 2 reasons why it is unsupportable:

    1) It is not disenfranchisement when people willingly avail themselves of the services of a city to earn income. There is no tax on anyone who wants to come into DC and have dinner (other than applicable sales tax — which by the way could be cut nearly in 1/2 if the non-resident income tax (“NRIT”) was legal). THAT would be a true commuter tax. This is a NRIT. You want to come in and earn $100,000 in our city? Well, you need to pay us for that privilege — just like the 50 states and their municipalities can do.

    2) Every place in the country can (and 43/50 states DO) tax non-residents who earn income within their borders. You work in NJ and live in Delaware? NJ takes a cut. You live in Rhode Island and work in Conn? You pay Connecticut. Are those people being disenfranchised? If they are, then the whole system can disenfranchise people EXCEPT DC.

    You wonder why DC streets are hacked up? Why DC public schools are like war zones? Why we have horrible infrastructure and services? Because we lose billions every year. We already have to tax the hell out of our residents via sales and income tax to make up for the federal payment deficit coupled with the lack of tax coming in from NRIT ban. It’s not fair and it’s not constitutional.


  4. Tom Bridge (unregistered) on November 4th, 2005 @ 8:09 pm

    Right, it’s entirely that DC is poor that our schools suck (despite per pupil spending higher than neighboring PG county and even Fairfax county). There are other reasons for school failure and I’d say there are plenty in DC that are non monetary. Same can go for the roads.


  5. JW (unregistered) on November 5th, 2005 @ 11:20 am

    The fiscal imbalance recognized by the GAO supported initiation of the lawsuit. But it is of little consequence when you look at it from a constitutional standpoint.



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