Wilmington daily gazette., 1872-12-05
Tax on Mortgages.

The Commercial, OF yesterday. takes up thu
question of taxing mortgages, which had been re-
ferred to- the evening before at the meeting OF tht
Managers of the Board Of Trade, and says
"The whole working Of the mortgage tax is bsd
Under the pretence of collecting revenue from
persons whose wealth is invested in those securl'
ties, it really adds a new burden to the already
overloaded debtor class, who. under the present
situation OF affairs, pay the tax
We were never an advocate OF taxing mortgages
1t is a process by which men are made to pay Il
per cent. instead of 6. In this way man owns q
house; it is worth S5,o00-there is a mortgage fol
$1,000 on the house. Now the owner pays the tax
on the whole 5000 on the house. and pays also
in addition. the tax on the 50, 900 mortgage. He,
therefore. paws the tax or eight thousand dollars
when the house is only worth $4,000 The result
is that the owner Of this house really has but sooo
in it. and yet he pays tax on $4,000 That is the
most Objectionable feature in this species OF taxa
tion But where can we find a remedy for The
thing? The Commercial would not tax anything
but real estate But does it suppose the landlord
would not add the tax to the rent? Certainly he
would. So long as property is in demand it will
command high rents just as money commands
usurious rates. In either the borrower or
tne " pay the Sost. A. "NAS AASs ~
the clause in the tax law chat permits the bor-
rover to pay the tax on mortgages, money would
not be loaned in our State, at the present legal
rate. |
The Commercial would have the mortgages OF |
the building and loan associations exempt from /
this tax. There is great doubt ebout the proprie-
ty of exemptng any mortgages from the tax with !
out the whole If the law is repealed we have no
objection to make.
The exemption Of loan associations does not
seem clearly right. They are not made up of the
poor. Their books contain the names of many of
the rich, and thousands Of the prosperous and well
TO do. They are better able to pay the tax On
mortgages than are the savings banks, or than
many individuals who hold such Investments
Neither are they compelled to pay the tax, They
have the same right to avoid its payment that 9TH
ers have. Special privileges are granted them by
law. They exact the highest rate that money will
bring at auction, in the face of usury law that
prohibits individual using his money to his
best advantage. They are in effect the most ex
acting "shavers'' The borrower often finds he
has paid them too high. Investors know what
rates they get that hundreds Of thousands of dol
lars are put out at rates from IL to 40 per cent.
premium. To leap these rates, rish men hold
thousands Of shares in these valuable institutions,
that appear now to be doing immense service to
all classes and we hope the people will not be
prejudiced against them by the assertions that
they are unjustly or unequally taxed. The fact {
is that they pay no tax that individuals are ex-
empt from, while they are clothed with special
privileges by legislative enactments that form the
most valuable franchise, which no doubt would
if offered for sale, very heavy revenue
o the State
1t is said by gentleman who seems to have a
studied the rystem upon which these institutions
IRE based, that the mortgage tax imposed on loan
would amount TO only about sioO during its whole
existence and would prolong its existence but one
month. He further says that he knows the bere.
its Of the loan associations have been lessened by
he frequent charges that they were heavily taxed,
which were mainly raised for political effect At
he same time that he advances these opinions he
) not in favor Of taxing mortgages, but would
ote against it. Z.