Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1873-09-20
THE PENNSYLVANIA REVENUE
SVSTEM


THE PENNSYLVANIA REVENUE
SYSTEM.
Now that the subject of taxation is at
tracing great deal of attention in this
State, it will be matter of interest to both
taxpayers and legislators to learn some
thing of the revenue systems of other States,
and especially that Of Pennsylvania, where
land, which in other States is regarded as
the basis of taxation, is not taxed at all.
sand yet" says the st. Louis Republican,
"tbe simplest and most effective revenue
system in this country is that of PeDg sylvia
nia. A person i-ained in the clumsy old
way Of taxing everything that can be seen,
and leaving those vast instruments of
wealth that cannot be seen untsxed, cannot
imagine how such P system is practicable;
ont the abundant revenue of Pennsylvania,
its unequalled public Clarifies and its high
credit prove that it can be made far more
productive than the revenue system that
prevails in nearly all other States" The
Republican details thu Pennsylvania sys-
tenn as follows:
ain 1868, when the revenue system of
Pennsylvania was the same as that now in
general use, the entire revenues of the State
were s., 422, 1873, of which real and personal
property paid 81, 733, 40l, corporations $745,-
III, and licenses and other sources $944, :
269. The largest proportion was derived
from real and personal property, and the
smallest from corporations. In 1866, the
State Treasurer, W liam 81. Kemble, having
thoroughly studied the subject and seen
how uuproductive and difficult of execution
tie existing method was, submitted to the
Legislature new scheme fthe most start
ling character--being nothing less than
proposal to abolish the tax on real estate
and equalizs sas es on corporations. As the
real estate tax was yielding 81 ,6O0,OOO per
annum, the treasaref's daring proposition
TO throw the source of this yield entirely
away, and seek compensation for it in Other
| quarters looked like madness; but IS Treas
urer Kemble had managed bis Office with
unusual good sense and ability, and as he
seemed entirely confident of the success OF
hisnew scheme, the Legislature finally con
sented to adopt 1t and rely upon him for
its effectual working. The careful calcula-
tons upon which he based his opinion OF
the result were amply realized. There was
no failure OF revenue, no deficiency IN the
treasury at the end of the year, and no de-
probation of the States credit, as many ap-
1 pretended; onthe contrary, the States OBJ
legations were promptly met, and its revenue
steadily increased. In 1872 the revenue
had grown to Sc, l24, 643, of which 1885,
65S was paid by corporations, and the resi-
due by licenses, collateral inherItances and
other minor sources. The State debt, which
had been reduced only about $2,OOO,OOO in
twenty wears previous, and which at the be-
ginning OF the new system stood al S31,-
All 1858, was reduced in 1872 to $21, 29S, 4St
"a reduction five times as great as had beer
effected in the previous twenty years. Ii
the meantime the State has been able tc
maintain its charities and 3 school system
by donations of the most munihcene char
acter. Its appropriation IN 1917 for the sup
port of the orphans of its fallen soldiers wa:
SAT- 1856, its appropriations to schools nave
been doubled, and 81, 100000 has been palt
| on the war expense account OF the state L
, would be imagined that this system is op
, pressive 10 the corporations that have 10 pea
The burden of il; but the Philadelphia PreS
declares 1t is rot so, and the absenc'
| of complaints from the corporations seem
to confirm is statement. The corporation
that pay the lsrgss taxes are the railroad
companies. These are taxed three mills pc
dollar on their capital stock and three pc
cent. In addition 10 their net earnings, Ii
! the case Of six per cent. dividend, th'
three per cent. tax is equal 10 tax OF ont
Snd eighteenth mills o. the capital; TIL
, added to the three-mills capital tax make
the total tax on the capital of such corpo
| ration four and eighttenths milis-or les
than one-hSlf per cent. The PEN sylyanii
: railroad, whose capital is $50, % !, 1887, anC
) net earnings SS, 247, 1858, paid tax last yea
{ of 1922 S34; and tie ReaSing railroad
, whose capital stock is S34, 236, 175, ant
whose me- earnings were 81, S29, 800, paid ;
} tax of S5S3,5l3. The capital stock OF al
! the railroads in Pennsylvania is $2l1,924,
: 733, and their net earnings last year wer
: S26 342, $40. A tax Of three mills on tn
t former and three per cent. on the latte
= would yield 81, ,044 per annum-thi
being the revenue from railroad corpora
tions alone The mining, manufacturing
, banking, insurance and other corporation
increased this last year to S4,O36,65S."
One ofthe virtues of this marvellous rev
enue scheme, adds the Republican, is tina
: it avoids the trouble and vexation OF dea
ing with individuals. 1t does not tax pei
sons at all; it limits its effects to large col
porate bodies in which persons are intel
osted. Thus, a railroad, mining, manufs'
turing or other corporate company pay
taxes for all its individual stockholders, al
so makes one visit from the collector sufhC
: for hundred to that many different stocE
holders. Household visits, espionGg
, oaihs, over assessments, and all the othe
expensive and dissgreeable annoyances
Il the system which deals with each indivir
ual, are avoided, and the abundant Sta
revenue is gathered, almost without Il
visible presence and acts of assessors an
), collectors. 1t would be advisable for oil
a., next Legislature TO appoint committee
,, examine and report upon the revenue 81
= TENS of other States, with view to adop
r ing plan more satisfactory than that
A force now in this State.
HIGH AND LOW TAXES.
;.I,o hr1 no Woch in