During this recession, people living in poverty have been doubly burdened: economic opportunity has evaporated and the District’s budget has been balanced by cuts to safety-net programs. Tax rates have stayed flat while essential revenues have declined. In his FY 2011 budget, the Mayor has recommended a single increase in taxes: he has proposed a reduction of the Earned Income Tax Credit which provides critical tax relief to low-wage workers.
There is a movement underway to take a different approach. The Fair Budget Coalition; the D.C. Fiscal Policy Institute, Save Our Safety Net campaign, and Think Twice Before You Slice Campaign have all called for modest increases in taxes that will be progressive and fair. Particularly relevant to the legal community, there is a new effort, Lawyers Invest in DC. The following is a letter from prominent D.C. lawyers urging a more balanced approach:
Dear Fellow Lawyers:
As you know so well from reading local news and more personally from your pro bono work, your service on legal assistance organization boards and your philanthropy, these are especially challenging times for low- and no-income residents of the District of Columbia. The tumultuous economy has forced more community members into poverty and homelessness than ever before.
Early in April, Mayor Fenty released his budget proposal for FY 2011 against the backdrop of a forecasted half-billion dollar budget deficit. This gap can not be closed through program cuts alone without causing great pain and hardship for those who can least afford it. There are a number of ways to generate revenue that would allow vital programs such as the access to justice initiative, interim assistance to persons with disabilities and child abuse prevention programs to be protected. The Invest in DC campaign, which includes several local legal service organizations, has recommended the following:
- Increase the income tax for DC households with incomes above $200,000 (by less than $9 per $1,000 of income)
- End DC’s tax exemption for interest paid on out-of-state bonds
- Update the sales tax to include more services
- Increase the minimum tax on businesses to $250
- Bring parity to the alcohol tax by taxing alcohol bought at a store at the same rate as alcohol at a restaurant
- Tap into the DC’s “Rainy Day Fund”
As a legal community, we are well positioned to say that justice demands a balanced approach to addressing this budget crisis. Many in the legal community are high-income earners and would be impacted by a bump up in the highest income tax bracket (Did you know that a legal aid lawyer earning $40,000 in DC is taxed at the same rate as a top partner in a large DC firm?). Who better than those of us who would pay this modest amount to say "A tax increase is okay; it will cause no material change in my life, but could in fact save the life of a vulnerable District resident."
It may not come naturally to say "tax me more," but to all of us who are part of this privileged profession of the law, it should come naturally to say "I am committed to justice in my community." We urge you to join us in signing on to the Invest in DC campaign and calling on our elected officials to do right and do justice. You can endorse this effort by following this link to the Lawyers Invest In DC page on the campaign's website.
Thanks so very much for your consideration.
Jonathan Abram, Hogan & Hartson*
Lisa Dewey, DLA Piper*
Peter Edelman, Georgetown Law Center*
Robert Fleishman, Steptoe & Johnson*
Tony Herman, Covington & Burling*
Chris Herrling, WilmerHale*
Jamie Hoag, DLA Piper*
Barbara Kagan, Steptoe & Johnson*
Bill Kelly, Stewards of Affordable Housing for the Future*
Deanne M. Ottaviano, Arent Fox*
Roberta Ritvo, DLA Piper*
Dave Roll - Lex Mundi Pro Bono Foundation*
George Ruttinger, Crowell & Moring*
Don Salzman, Skadden*
*firms listed for identification purposes only