District of Columbia voters turned out in record numbers yesterday and overwhelmingly rejected a $1,200-per-pupil education tax credit proposal that had attracted national attention and triggered a stormy local battle over public education in the nation's capital.

The tax credit initiative, the most bitterly debated issue in yesterday's off-year school board election, was defeated by a margin of about 9-to-1.

Final returns showed 73,829 voters opposed the measure, known as Initiative No. 7, while only 8,904 favored it.

Only 15 minutes after the polls closed at 8 p.m., City Council Chairman Arrington L. Dixon, one of the major opponents of the tax credit initiative, had declared victory.

"We socked it to them," Dixon exclaimed. "The whole community rallied around this one issue. It shows the irateness we felt about this outside intervention . . . It shows the community's support of public education."

Bill Keyes, chairman of the local affiliate of the National Taxpayers Union that mounted the tax credit drive, conceded defeat shortly after the polls closed, and claimed the measure was defeated by a "vigorous smear campaign."

"Our opponents talked about money," Keyes said. "They talked about our TV commercials. They made legal attacks that were without merit. They made personal attacks on me. They continued to talk about everything except how the initiative could have helped the education of young people in this city."

In the school board election, where four incumbents were facing spirited opposition, at-large member Frank Shaffer-Corona was soundly defeated. But at-large incumbent Barbara Lett Simmons won election to a third term. The Rev. David H. Eaton, senior minister of All Soul's Church, won the second at-large seat on the ballot.

In Ward 2, incumbent Alaire B. Rieffel lost by 299 votes to R. David Hall, a realtor. Incumbent R. Calvin Lockridge won election to a second term, defeating six challengers in Ward 8.

In Ward 3, where incumbent Carol L. Schwartz did not seek reelection, Wanda Washburn, a long-time school activist, easily defeated Mary Ann Keefe, an economist. Keefe ran with the backing of the ward's Democratic council member, Polly Shackleton.

In an election marred by snafus at several of the city's 137 polling places, voters also were to choose 45 delegates to a statehood constitutional convention and 364 advisory neighborhood commissioners. But results of those races were not immediately available.

City election officials reported that 84,393 people voted in the election -- nearly 31 percent of the 273,183 registered D.C. voters -- a total that more than doubles the 14 percent turnout of the past two school board elections, in 1977 and 1979. The turnout easily surpassed the previous record for an off-year school board election, 43,726 in 1971.

The tax-credit proposal would have enabled taxpayers to reduce their D.C. income taxes by up to $1,200 per pupil for educational expenses at either private or public schools.

The proposal would have permitted nonparents to take the credit if they contributed to the education of low-income children. Also, corporations could have written off up to 50 percent of their annual D.C. tax liability by helping needy D.C. students.

The intense controversy over the proposed education tax credit also may have increased voter interest in some areas, according to officials at the polls.

The Board of Elections and Ethics, which after numerous snafus several years ago had run relatively error-free elections in the past few years, was besieged with complaints about delays and foul-ups caused by the city's revamped computerized voter-registration system.

Frequently, election officials couldn't find the names of registered voters on master printouts prepared by the elections board. Special forms had to be filled out before those persons could vote. In some cases, voters were mistakenly turned away. By midday, the elections board was publicly urging those people to return to vote.

Opposition to the tax credit proposal appeared to run high in key precincts throughout the city, particularly in affluent sections of the Wards 3 and 5, in Northwest and Northeast Washington; in the Kalorama area of Ward l; and in the outer ring of middle-class black neighborhoods of Wards 4, 5 and 7, according to spot interviews with voters leaving the polls.

The most frequently voiced criticisms were that the credit benefited the wealthy more than the poor and that it would damage the city's school system by creating a drain on the city's treasury. Some voters also complained that the tax credit had been promoted by outsiders.

"We have enough outsiders already trying to control us, and I think it's time we do what we want -- not what they want," said John E. King Jr., 401 Jefferson St. NE, a retired government employe and a part-time cab driver.

But Douglass Schocke, who lives near Kalorama and Columbia roads NW, said he voted for the initiative because "there are only about three schools in the city I feel I can send my kids to," while school officials "don't seem to be doing anything to control the situation."

Mayor Marion Barry, speaking at a victory press conference held by the measure's opponents in a downtown office building that had been the headquarters for the anti-tax credit drive, said the vote sent one clear message to the country: "Nobody ought to mess with our public schools."

"I'm wearing my black suit -- my funeral suit tonight, 'cause we just killed Initiative No. 7," Barry said. The mayor said the NTU initiative had brought together the broad coalition that fought the tax credit, and said he hoped it would stay together to improve the schools.

D.C. schools Superintendent Floretta D. McKenzie, in a written statement, picked up the same theme, urging community support for the schools and declaring that the tax credit's defeat was "a mandate for continued improvement of the D.C. public schools."

Delegate Walter E. Fauntroy (D-D.C.) said the vote sends a message to "right-wing demagogues" around the country who want to "take us back into the 17th century."

The Rev. Ernest R. Gibson, chairman of the D.C. Coalition Against Tuition Tax Credits, said the results showed that "no outsiders could destroy the public schools here."

But James D. Davidson, chairman of the National Taxpayers Union, said, "We were whupped at the ballot box. But I don't think that means it's hopeless. As has happened many times in the past, innovation is not accepted on the first go-round."

Davidson placed some of the blame for the defeat on The Washington Post, saying the newspaper "ballyhooed the arguments of our opponents that helped stir up a fear of the unknown that was not justified."

"I think a lot of the things that were seized on by the opponents didn't make sense," Davidson continued. "But it's reasonable that when people are in doubt, they'll reject something."

"I think many of the people who voted against it did so out of fear rather than being informed of the facts," Davidson said. "We had a very hard time getting our ideas transmitted to the public."

In the furor over the tax credit, a local offshoot of the National Taxpayers Union was pitted against the city's establishment of political, labor, business and church leaders.

The referendum was viewed by many as a crucial test of a concept that could help parents send children to private schools, shift government resources from public to private schools and spur the enactment of similar measures in other states and in Congress.

The two sides poured a total of $225,000 into the hard-fought campaign, which was waged in the courts (where opponents tried in vain to block the initiative), at occasionally stormy public forums and on local radio and television.

The NTU, an anti-"big government" group based on Capitol Hill that tried unsuccessfully in 1979 to place a similar measure on the ballot in California, contributed 99 percent of the $125,000 spent on behalf of the D.C. initiative.

Supporters of the measure produced a study contending that the maximum loss of city tax funds to private schools would be about $20 million, based on the tuitions now paid by the city's 20,000 children in private schools.

Opponents contended that the tax credit would do little, if anything, for poor and moderate-income families whose children attend public schools, while lining the pockets of wealthier families who already send their children to private schools.

Morever, they argued that the $1,200 tax credit would drain the city's treasury of $24 million to $38 million and force the city to lay off 3,000 to 4,000 employes and increase property taxes.

The anti-tax credit campaign focused on approximately 37,000 union members who are registered to vote in Washington. The largest group of them consists of D.C. school teachers and blue-collar city workers who belong to the local affiliates of the American Federation of Teachers (AFT) and the American Federation of State County and Municipal Employees (AFSCME).

The AFT, AFSCME, the National Education Association (NEA) and other unions contributed at least $100,000 to defeat the initiative. Unions also volunteered the services of several dozen staff members to help organize the fight against the initiative.

The opposition received unexpected assistance from administrators of some of the most prestigious private schools in the Washington area, who said that the tax credit would harm the public school system, and from the Most Rev. James A. Hickey, the Roman Catholic archbishop of Washington, who remained neutral in the controversy.