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NSIAD-85-58 1 (1985-03-15)

handle is hein.gao/gaobabnpp0001 and id is 1 raw text is: 






  NATIONAL SECURITY AND
INTERNATIONAL AFFAIRS DIVISION


byte


The Honorable John C. Stennis
Ranking Minority Member
Subcommittee on Defense
  Committee on Appropriations
United States Senate


Dear Senator Stennis:


Subject:


Military and Federal Civilian Disposable Income
Comparisons Using January 1985 Pay Rates
(GAO/NSIAD-85-58)


     This is in response to a February 15, 1985, request by your
office that we update certain information on comparative dispos-
able incomes that initially appeared on page 15 and in Appendix
IV of our report on Military and Federal Civilian Disposable
Income Comparisons and Extra Pays Received y Military Personnel
(GAO/NSIAD-84-41, May 4, 1984).   EFclosure I is a summary table
updating the disposable income comparisons using January 1985
pay rates, and enclosure II provides more detailed information
on these comparisons. While these comparisons show projected
income for 1985, they do not show the effect of the Administra-
tion's requests for a July 1, 1985, 3 percent military pay
raise, and an October 1, 1985, 5 percent cut in civil service
pay.

     The enclosed disposable income estimates rest on numerous
simplifying assumptions about pays, family size, and taxes and
are not intended to be representative of a typical military or
civil service individual. The specific assumptions used are ex-
plained in footnotes to the enclosed tables; however, it is im-
portant to note the following:

     --Estimates of state and federal income taxes assume a
       standard deduction, although many taxpayers, particularly
       homeowners and those with higher incomes, claim deduc-
       tions which exceed the standard deduction. Because of
       the nontaxable nature of some military pay, larger item-
       ized deductions would proportionately increase civil
       service disposable income to a greater extent than mili-
       tary disposable income.

     --Both military and civil service personnel were assumed to
       be living in Virginia and paying Virginia state income
       taxes, although data shows that, because of the Soldiers'
       and Sailors' Civil Relief Act of 1940, a large percentage


391033


5-3 101'


B-215107


RELEASED


MARCH 15, 1985





   126488


/Z4 t


UNITED STATES GENERAL ACCOUNTING OFFICE
        WASHINGTON, D.C. 20548

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