The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1853-08-24
Bank Taxes.

6ttonuOn Vi our I6hucTS.
But it is claimed that bankers are not
taxed like other individuals they are
not permitted to "deduct their indebted
ness" Let us see for a moment. WHAT'S
it the law proposes to tax in the hands Of
individuals? Manifestlv. property. What
does the constitution-wha does right and
Justice say shall be taxed in the hands of
bankq Property! 'All property en-
ployed in banking, shall bear a burden of
taxation equal to that imposed on the prop
erty of indiuiduals," is the language ofthe
constitution. Now, what is the property
Of bank! Are not the notes and bills
discounted, and which are drawing inter-
est. property? Are not the State stocks
belonging to it and upon which it draws
interest. property? Are not all other mon
eys, effects or dues, loaned, invested, or
otherwise used or employed with a view to
profit. or upon which such bank or bank
ing company receives, or is entitled TO re.
ceive interest, property?". All these would
be property in the hands of an individual,
and he would be compelled to list them for
taxation.
But we are met with the argument that
from his '.moneys and credits'' an indivlG.
ual may deduct his Indebtedness; and it is
claimed that the same privileges should be
extended to bank. This is true, and we
are free to admit that it is an anomaly in
the law. Its existence may, however, be
explained in several ways. In the first
place, indebtedness is permitted only TO be
deducted by individuals from the single
item Of moneys and credits, upon the sup.
position that it is limited to the necessities
of the owner, and that the moneys on hand
are Intended exclusively for the purpose OF
liquidating that Indebtedness, and not for
the purpose OF speculation or profit. But
when they become the siock in trade ofthe
individual, or corporation, and upon which
they predicate business, as in the case of
a banker or broker, then they stand pre-
cisely upon footing with the merchandise
Of the merchant, and should be taxed
without deduction" Any other rule
would be to permit them to evade taxation
entirely; for it is well known TO all who
have been so far Initiated into the myste.
ries of banking as TO be permitted to in
spect bank balance sheet, thatthe 7iabil-
tiles al'cays foot up equal to the resources
There is another reason why there is no
analogy between the case Of an individual
and bank. The individual who con-
tracts Indebtedness is compelled to pay in
terest or its equivalent, in enhanced price
upon that Indebtedness, whereas. the bank
.r is privileged by law to draw interest Mp-
on ms oDn Indebtedness. So, in any light
in which, we view it, the cases are not anal
agous. But, above all this, the constitution
says: "The General Assembly shall pro.
vide, by law, for taxing the notes and bills
discounted or purchased. moneys loaned,
and oil other property. effects or dues, OF
very description. (rithout deduction} OF
Ill banks now existing, or hereafter crea.
ied, &C." In like manner individuals are
loi, except in the single instance mention
ID, permitted to deduct their Indebtedness
from their property. Through the entire
aw, the idea Of taxation upon capital is
excluded-it is no where made the basis
Of an assessment In the law, as well as
the constitution, property alone is made the
basis, without reference TO the amount Of
capital employed.
The farmer who purchases piece OF
.and upon Credits not permitted to deduct
any portion of his Indebtedness from its
value-he is taxed upon the full amount
Neither can he deduct from the value Of
his stock ! his horses, cattle, or other per.
sonal property. any portion Of his indebt.
edness. Neither can the merchant from
his stock Of goods, nor the manufacturer
from the materials employed in his busi-
ness-all these are taxed upon the saver
age amount of fproperty in their possession,
and under their CONTROL" without any de-
duction for Indebtedness. Now we submit
that the notes and bills discounted, mon
eys loaned, &c., of the banker, on all Of
which he is drawing interest or making
profit. are as proper subjects for taxation
AS the goods or wares of the merchant,
laying idle on his shelves, depreciating in
value every day, and for which he is per-
haps indebted or paying interest; or the
stock of the farmer, the manufacturer or
mechanic. The instructions under the tax
law have been, for years, s'merchants must
include in their statements the average val
ue Of their goods and merchandise, and
manufacturers the average value of the
raw material used and on hand in the man.
uiactured and manufactured articles
ltis the average value of the property on
hand during the past year, and not the val
ue OF the capital employed, that must be
returned. merchants and manufacturers
cannot deduct their debts from their stock
Of goods and manufactures. This is the
language of Auditor Woods, in his in
siructions 10 Assessors and Auditors over
the State, the last six years, under the old
tax law, which has been eulogized by every
Wing politician and press, and lauded to
the skies as a perfect model OF tax law.
Where then is the injustice of applying to
banks and bankers the same rules that have
for years been applied TO merchants. man.
ulacturers and other individuals? But. it
is said, the banker is compelled to keep a
certain amount of money on hand to meet
his Indebtedness, and he is taxed upon
that Not so. The money laying idle on
hand, the deposits or other money not
used, employed or invested with view to
profit, are not required to be listed; and
herein may well be expressed doubts as to
whether the law goes as far as the consti.
tuition requires. Again: it is objected, the
law taxes the "deposites" Of bank, and
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