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Norton Will Introduce Commuter Tax Bill

Following a U.S. District Court judge’s dismissal last week of a lawsuit aimed at ending the Congressional ban on a District commuter tax, Del. Eleanor Holmes Norton (D-D.C.) said she will introduce a bill that would find an alternative Congressional solution to allow the tax.

Norton said late last week in a statement that she believes the bill she plans to introduce will be bolstered by arguments made by the Virginia and Maryland governments during the case — specifically that the District’s structural imbalance needs a federal solution. She said she will encourage District lawyers to appeal their case while she moves forward with her bill.

“This lawsuit has been a wake-up call to the region, as their briefs show, that it is time for Uncle Sam to meet his responsibility to his own Nation’s Capital,” the statement said.

Norton Chief of Staff Julia Hudson said the Congresswoman plans to drop the bill sometime in the next few weeks.

The commuter-tax ban has been in effect since 1973, when Congress enacted a statute providing that the District City Council “shall have no authority to … impose any tax on the whole or any portion of the personal income … of any individual not a resident of the District.”

In their case, District lawyers charged that the Congressional ban prohibiting the city from enacting a commuter tax was a discrimination case. They argued that if the ban was lifted, the District could collect on some $30 billion in taxable income earned by commuters and that the money would go a long way toward making up the District’s large budget shortfalls which have recently been reported by the General Accounting Office.

“This court is likewise mindful of the unfairness of the situation plaintiffs seek to change,” wrote District Judge Ellen Huvelle in her decision Thursday. “But longstanding judicial precedent compels the Court to conclude that plaintiffs do not enjoy the right they seek to obtain. As has been the case for over two hundred years, the residents of this jurisdiction ‘must plead their cause in other venues,’ for this Court has no authority to overturn Congress’ ban on a commuter tax.”

“The court said the ban on the commuter tax is manifestly inequitable and unfair and regrettable, but not something the court can fix,” explained Walter Smith, executive director of D.C. Appleseed Center for Law Justice, which is advocating on behalf of the District in this case.

Smith said District lawyers plan to appeal the decision, but he also hopes Norton’s bill will receive support from both the Maryland and Virginia governments and their representatives in Congress.

“It all boils down to that you can’t treat Washington, D.C., in a discriminatory way when it comes to taxation. I believe the court decision keys up Eleanor’s bill,” Smith said.

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