D.C. City Council member John Wilson (D-Ward 2) proposed shifting $41 million in the proposed District fiscal 1986 budget yesterday to fund a rent subsidy program, increase spending for drug treatment programs, reduce income taxes and trim the city's deficit.

Wilson, chairman of the council's finance committee, presented the proposal to the council in a closed-door budget session and said that the members appeared to be receptive to most of it. The full council is scheduled to review the mayor's proposed $2.2 billion budget at a public meeting next week.

Wilson would reduce the total set aside for inflationary adustments by $18.4 million, would cut personnel expenditures by $8.5 million and require some city agencies to absorb $7.2 million in salary increases.

The other shifts include $3.5 million earmarked in the budget proposal for small capital projects, a $2 million request to establish an office to enforce such city regulatory laws as housing codes, and $892,000 in administrative costs.

Wilson recommended shifting the $41 million to three areas. He would establish a $15 million rent subsidy program, reduce taxes by $11 million by increasing the D.C. personal income tax exemption from $750 to $1,000 and spend $4 million on drug treatment programs. He would also set aside $11 million to help reduce the city's deficit.

"The proposal reflects what I think the priorities of the city should be," Wilson said. "The money would be spent on things that all eight wards need, and all people would be affected one way or another."

After discussing his proposal with other council members, Wilson said that he doubts that the council will accept a reduction in income taxes.