The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1865-12-25

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Tho movement to construct railroad from Oswcso
" 70 this city has thus far resulted In tho orgAnxa
ton Of q company with ten million dollars capital. tho
election Of board Of directors the opening Of subscrp
ton books and the beginning Of subscription This
road will important sections Of Otsego Schohs
RE. Delaware. Greene Ulster and Sullivan counties
which thirty TO sixty mics from any facility for
transportation and travel effective than the ordi
nary farmers wagon. Tho counties traversed by tho
proposed road have hundred thousand nhabtans
whereof ham . million will be customers 10 this road
Though but little than half their has yct boon
improved their farms onciaiIy valued ct hun-
dred and eighty millions OF dollars
Tho Treasurer OF the United States has written tho fol-
lowing letter reference the taxation Of the und
vided profits OF national banks
TREASURY or rgg UNITED SrATEs
WASHINGTON, Dec. II, 1896. I
GESTLEMEs-Your communication OF the 18Th instant
duly received. AS suggested by you, have bad
full with the Commissioner Of Internal Rev
enue In regard points raised thogciu the delay
In tho reply has been accustomed by the fact that haye
not been able TO consult thst ofcer earlier time
National Currency net, have deemed il my duty TO
require TO DO included among deposits subjcct TO duty
tho undivided profits OF bank. II has been always
clear 10 me that profits should ray duty under this
section. fhe question might be raised should they
me- that shoy wore more in tho nature Of deposit shaD
OF capital have directed that they DO clssscd Tho
duty deposits and on capital is fixed ct tho same
rate that II being decided that PROFITS 10 pay
duty. the duty under either head would be the same
In amount, with the exception following few banks
may possibly own United States bonds Of
their Capital In cas, proGts were classcd as capital
they would be entitled to deduct such bonds to q
greater extent than they do with PROFITS cssed
deposits II Is not probable, however. that there arc
many banks that would DO the gamers by the different
construction
The Commissioner OF Internal Revenue constrres the
law under which be acts 20 require him 70 obtain
from all banks national State, Of the taxes
dividend and surplus aud also 70 exact the license fees
required by the same act while II In true that the
National Currency act providing for the semi annual
duty specifies that this duty shall be in lieu Of oil exist
Ing taxes happens that this provision applca
bio 70 the Internal Revenue act which became law sub.
seQuent Tho passage the National Currency act
While the examination given TO the matter hos made
evident that tho item or surplus IL liable TO pay
tax or duty extent greater than had supposed II
has also resulted tho conviction that change In tho
present requirements could DO mado that would meet
your views consistently with the construction given by
each officer 10 the law under which ho acts
desire here TO state however what have heretofore
baIly and by wr item that my opinion
public policy requires that the surplus fund Of bank to
the extent say Of twenty per cont OF sne capital should
This view am pleased 10 know has tho concurrence OF
the Secretary Of the Treasury OF tho Commissioner OF
Internal Revenue OF the Comptroller OF the Currency.
and Of gentlemen In Congress who have given the sub
jcct Their attention II Is proposal therefore, by the
Commissioner Of informal Revenue and by myself that at
carly period in the session meeting bs hold OF the
oc named in connection with members oil tho Com
mtcc of Ways and Means, and OF tho Committee on
Banking and Currency OF the House OF Representatives.
before which committee matter relating 10 banks WI
PROBABLY come for consideration, and II IA most likely
that the result OF such consultation will 10 the recon-
meuda,on to and adoption by Congress Of provision OK
empting from duty tax surplus funds TO the extent
named, at least TO such extent ~ will greatly
strengthen the banks by encouraging the accumulation
and retention by thcm OF surpuses.
In regard 10 the matter of daily settlements can
only say that the present requirements adopted by
the Internal Revenue Office, aud by this office sftcr
l consideration given TO the subject and that the
method OF making returns Of deposit required by both
ofhcesthat 49, the balances hand when the books Of
the bank are closed for the dayhss been deemed equ
table and Just. Very respectfully
r. T.. SPINNER, Treasurer United 5tates