The state rights democrat. [volume] (Albany, Linn County, Oregon) 1865-1900, 1865-10-07
TAXATION OF GOVERNMENT
SECURITIES.
The States ofCOnnecIicut and New
Hampshire i'm ..RebclIiOn.'s

The Comptroller of tlb Currency has
written the following slflrp letter to a
bank officer in Hartford1 jim reference TO
the recent action Of the Connecticut Leg
%islaturc ON the taxation Of Government
Securities:
OFFICE or CuMrTRoLLEr or rHE Cum
EEScY, WAsnlSeroS, July 20, 'B5.
| cannot but express my surprise that
the Legislature Of the State Of Connect
cut should entertain a proposition to vir-
tually confiscate a portion of the Govern
ment Securities held by inhabitants Of
that State,
The law exempting from taxation Gov
ernment Securities is 50 specific and clear
that it cannot be questioned. The bonds
were disposed of, and purchased with the
provision of law as u part of the contract,
that they were to be exempt from taxa
ton, and the country has received an
equivalent for such exemption in the ad-
ditional price received for the bonds.
Can any one believe that the obligations
of the Government would have sold for
anything like the price realized. or at any
RLlS[ ~ III tOiuIlCISuIdlG Will lIEll
value, if it had been supposed possible
that they could be taxed By State laws,
directly or indirectly ? If your Legisla-
ture can impose a tax of fifteen per rent
on the income derived from Government
Securities, it is just as competent for it to
impose a tax of fifty or one hundred per
lcentum.
1t is a ource of regret that any North
Iern State should for a single moment
countenance an attempt to repudiatc or
~nullify a constitutional act of Congress,
and one. too. hat was deemed necessary
to preserve the integrity of the nation.
In one aspect of the case, however, it
may be regarded rs a most fortunate oc-
cu%rrenec. as It will serve to show the peo-
pie that it will not be safc for the Goy-
ernment to allow the Southern States to
be so reconstructed as TO permit their be-
ing represented in Congress as a unit, as
they would be. by men who would be bat
too willing to unite with northern men of
the character of those favoring the meas
ure under consideration. to repudiate the
national debt, if not by direct action, By
an equally destructive want of action in
providing the means of payment | am
glad to hear, and the whole country has
reason to rejoice, but the Finance com
mittee Of your State Senate stands opposed
to this insidious measure. The effect Of
the proposed tax would be to reduce the
value of Government Securities in the
hands of the people of your State fifteen
per cent, provided there was an assurance
that no further exaction would be inn
posed. but without such assurance would
reduce the market value much more, as
the next. or any subsequent Legislature
could increase the tax to the extent of
destroying their productive value entirely.
The State of New Hampshire has passed
a law imposing a tax Of % per cent. on
the income derived from National Secur-
titles.
If this action was confined to the two
States. the result would simply be to de-
prire the people of New Hampshire and
Connecticut Of the privilege of holding OF
downing Government Securities. 1t Is
very clear the States would not get tht
tax. rs the owners would sell their seeu.
tiles to parties ont OF the States, or go out
themselves with the securities.