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Highlights

In 1967, the principle of providing automatic adjustments in military pay based on increases in federal civilian salaries was established. Since that time, automatic increases in military pay have been indexed to the average percentage increase in General Schedule salaries.

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Recommendations

Matter for Congressional Consideration

Matter Status Comments
The House and Senate Armed Services Committees should initiate action to require that military personnel accounts in the DOD budget and individual service budgets reflect the federal income tax advantage of regular military compensation. The military base pay and allowances system should be replaced by a salary system.
Closed - Not Implemented
DOD stated its opposition to changing from a basic pay and allowance to a salary system. At this time, Congress showed no interest in making a major change. Reflecting the value of the tax advantage in the DOD budget is not politically appealing.

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