Rutland weekly herald. [volume] (Rutland, Vt.) 1859-1877, 1865-04-20
Taxation of Bank stock.

EaltGF LHttQH0 hCfdEd = ne Dduh OI x
Rutland has issued a circular to its
stockholders which states; In con- Il
formity with the laws of this State,
have, as usual reported the amount o.
stock held by you to your town clerk n
at the same time notifying the listers &
that all the capital of this bank is in
vested in United States securities, which s
I by decision Of the Supreme Court o.
/ the United States, eXempts the stock 4
from town, county and state taxes"
1t is important that the grand list of I
1.-THE towns should be correct and uniform, Z
5 The subject of taxing bank stock has )
fbeen the subject Of discussion and shoulds
abe understood by the listers in makingE
sup the grand list for this year. My OBJ !
ject is to elicit inquiry and have the !
matter understood to prevent trouble to
towns and taxpayers. According to I
Smy understanding the circular is entire
lily erroneous. The bank, by investingE
Tits capital in United States bonds, saves
"a tax upon its capital under the UnitedE 1
Estates revenue law, but does not preventE
|the stockholders from having theirF
shares or stock put into the grand list,
sfor the assessment of state, town, school ]
land other taxes. 1t is said that the Su-
sspreme Court Of the United States has de- I
s4cided that where bank has invested itss
acapital in United States bonds theS
Estock is not taxable. This statement isl
3erroneous. The only cases decided byE
1.-THE Supreme Court of the United States
Jare two. The first case was under AM
s9act Of the State of New York which,
Supposed tax on the capital stock of
sabanks to be assessed at its actual valued
5and taxed in the same manner as otheri
sgpersonal or real estate Of the country.
This law was hoped to reach banks
SSwhose capital was invested in United
III States bonds. The court held that asI
ssIs to banks which had invested their capi-I
stal in United States bonds, the tax wasi
ga tax upon the stock which being ex-l
gempt from state taxation, was illegally
81 supposed. After this decision the legisa-
3ture of New York passed an act that
q banks should be liable to taxation onI
la valuation of its capital equal to the
Samount of their capital stock paid in
zssand in the case of the Bank of the Com
si mOnwealth vs.. the Commissioners of
3TaXes, Judge Nelson delivered the opin-
29ion Of the court and decided that the
81 tax upon the bank under this law was IL
illegal and that the instruments of the
aU. S. government are not the subject of
I State taxation. 1t will be seen that in
ssg these cases the tax was imposed upon
aathe banks. 1t will be perceived that
these decisions do not settle the point
sa that stockholders are not liable to pay
sStaxes upon their stock in banks The
.5capital Of the Bank of Rutland if in
sdvested in United States bonds is not
5A3subiect to state taxation, but the stock
ssAholders of the stock in the bank are liz
( sable to be taxed upon the stock, which
IL is not taxing the bonds. More doubts
may bG AdlSCNl do W GdACS ujOu NdblOI-
Hal Banks. National Banks are institu-
EAtiOns of the United States government,
agand are subject to United States laws
land regulations, and state laws cannot
S reach them, only by the license Of the
~ United States government. By the act
@aof Congress establishing q national
eacuwency, approved June 3, 1864, in the
to'the 4lst section it is Provi-
sHded, that nothing in this act shall be
s9Construed to prevent all the shares in
H;sany of the said associations held by any
or corporation in the assessment
asof taxes by or under state authority at
E5 the place where such bank is located
k9and not elsewhere, but not at greater
barate than is assessed upon other money
Ned capital in the hands of individual
scitizens Of such state, Provided fur
Edther that the tax so imposed under th'
Ks laws Of any state upon the shares Of any
Ega aof the associations authorized by thi:
asact shall not exceed the rate imposed
s upon the shares in any of the banks or
Aaganized under authority OF the stat,
~ where such association is located"
M Now does not this proviso give t.
Estates the right to tax stockholders il
Sensational Banks under the limitation no
IA to exceed taxes upon other persona
Mproperty to individuals. The Vernon
3Legislature has provided that the stocl
shall be put into the grand list for tn
assessment of taxes, like other persona
'slproperty.
,@a / come to the conclusion that all BAN
4stock is to be put into the grand list
sS and National Bank stock in the tow,
where the bank is located. If l am in
correct hope that others interested i
this question will point it out, SO tha
Eve may have for this year correct an
IS uniform grand list. 3.
eN Gen. Grant went to Philadelphia o.
n ~ EriIau