Ellsworth American. [volume] (Ellsworth, Me.) 1855-current, 1876-01-13

le renewed. altnouSl tue ilii-ui-t oI Tue ACT
seems 10 imply direction To execute and is
sue them whenever the substitution should be
found to be practicable. There is at least such
room for doubt, whether 1t lies in the discre-
ton OF the Treasurer 10 defer action looking 80
the substitution until il shall appear to Kim
10 be for the interests of the State TO effect the
exchange. as to render IT advisable. in justice
10 mat officer. 10 define his duty in this respect
more explicitly.
The only action necessary. however. If my
suggestion should recommend itself to YOU.
would be the repeal of much of the act to-
that of February -. lN15-a> relates TO the cX
ecuton and issue of new bonds. The LegiS-
lalurc would then retain control of the matter
and be len 10 provide for the paymeat of the
loans in question, or Tor their renewal and eX-
tension, "a they seyerally approach maturity.
or whenever il may suit its own pleasure. The
report of the Treasurer will present to YOU the
elaboration of "A suggestion for the payment Of
the loans maturing "a 1880 and 1855, the for
mer OF which amounts to S30l 900, and the
latter 10 So, 600, and demsn>tf ate that, since
the State has no other liability 10 meet within
the period from ISIS to lSS9. such payment can
be proyid, d for al a future date by near IF a
comparatively light tax and temporary loans
The extinction ofthe sinking fund of 1855 ei-
fects a relief from annual taxation 10 the extent
of about Sl90OO0 and i a measure of eminent
justice and good policy. The period from
which thi, burden has been lifted remains
the financial aud business difficulties by which
the people are at present confronted tend TO
make the weight more and more oppressive.
II we shall have happy deliyerance from pres
cnt and threatened ills the spirit of our people
affords full assurance for the belief that they
will turn this temporary alienation Ia so good
account in the development OF the resources
of the State and the iucreaS" Of il wealth. a.
10 render more than an equivalent for the cN-
empiion they have obtained.
The sinking fund of lS6S. which remains and
j. required 10 be maintained. WAS established
10 pay the principal oil the loan for the cquali-
zaiion OF municipal war debts" The loan ma
lures in October. lNSl. AMI now amounts 10
something less than three million, of dollar.
haHinE been reduced by the cancellation OF
some of it, bond, which formed part Of the
polished sinking fund. II gained oo.2,i.D
the pat year by taxation. transfer and interest,
aud now amount, 10 s67G.7li.72
The state. IN common with al other iuNc>;
ur>. has OF late wears been obliged Ia pay high
premium tor the securities prescribed 10y law
for IL investments ami II i "a matter well
worthy OF YOUR consideration. whether it. iu-
tcre>t> would not BE- sub>erycd by charging the
lit OF authorized investments for the sinking
fund. by the addition Of some other classes OF
securities OF undoubied value.
TAXATION.
The revenue of the State. in addition 10 the
sum procured by the State TAX. the levy OF
which j. directed and the rate fixed by the
Legislature annually. i derived from the tax
on railroad companies. savings banks and in
,urancr companies. \ tax Of one and onc-hali
per cent j. levied upon the corporate franchise
OF railroad companies Incorporated under the
laws ofthis State or doing business therein The
value of franchise 10 be- determined for the par
pose by d, dncting from the s>ccrtaincd markct
value of tie capital stock of each company, the
value oft, real estate and other property aci-
ually subjected to local taxation. AMI by de-
Quoting also, in the ease Of lines extending be-
yond the State, the proportional valuation OF
such extension.
The act imposing the tax upon railroad CON-
panies, wa, passed by the legislature Of IS1l
aud an assessment upon them for that year wa
made under it, provisions. Several cpmpan-
L. haN lng failed 10 pay the tax assessed upon
them, an act was passed bv the leg, stature oi
last year To provide a more speedy and effective
method Oh enforcing payment.
While the state treasurer was taking steps
u proceed under the new law against the de-
iiuquent companies one OF The stakeholder, OF
the Maine Central company residing IN another
STATE. brought bill in equity in the nitcd
states Circuit court. alleging, in substance. the
uou-Validty OF the act of the legislature under
which a tax had been assessed n inst the
Maine Central company. for the reason that it
impaired the obligation Of the contract contain
al IN the charter granted bv the State 10 that
company. and PRAYING the court to enloin the
treasurer from correcting tAc IAN. y temporary
injunction was granted by the court, and the
trca>u i Therefore prccludcd from further
efforts TO collect the tax. and virtually restrain
ell from proceeding against the other dylin-
qneCt companies whose charters contain .
e. auSe similar 10 that upon which the Maine
Central rests IL claim for exemption. \ fur
Their hearing upon the question Of permanent
injunction will be- had Al the Apr. term Of tn,
court. provided the parties d. not unite "a
bringing one about al an earlier day. The d.
ingui>hed gentleman who acted a, counsel flr
the State in ihi- msttsr in the absence Of the
attorney general in hi report 10 my predecessor
say; Il have entire confidence that the uitim-
ale result Will DE the sustaining Of the lsgi-a-
tive act taxing thi, corporation.
81 the Sj03>4.j2 received from the tax on
railroad companies for lS4i. the sum OF =, .0,,j =
- has been apportiOned 10 the cities and towns
wherein shareholders had their residence.
The tax of one per cenf.on the DEPOSITS il saw
ing banks yield i large and easily collected
revenue. one-hal OF which j, appropriated by
law law for the Use of schools. AMI unc-half 10
the use of the State.
No consideration Of justice or policy present.
Itself % NY mind IN opposition 10 the maiutcn-
ance OF the tx AT the present rate The sub
s,iiuilOn Of state for local taxation effects q i =
elimination ia favor OF deposits iu savings
banks OF At least MY per cent. The ohjyci in
view IN suhlectlng them TO a fixed and lower
rate Of taxation was not. presumably. rccos-
tons and the promotion of thrift. hut the ell
couragement of the continuance and growth Of
q fund readily accessible TO taxation. con-titut-
eel by earning and >urplu. capital which might
otherwise prove fugitive and elusive in thu
respect. The continued increase Of the amount
81 deposits indicates that the tax exercise, M
deterrng influence upon depo>itor-. and % f.!
n | am Informed bank officers generally do
not regard the tax onerous or tending 10 re-
pei deposits. Institutions recently organized
or suffering from the failure II Investments
finding themselves unable 10 declare the max
imum dividend allowed ~ law. may b. appre.
hen-ive that the consequences will prove UNI
favorable n them IL should he borne in mind
however, that low rate of interest j. the rul,
affecting all capital seeking Investment. and
that. while II continues IN force. depo>itor-
would gain nothing by Withdrawing their fund.
since they could not obtain elsewhere greater
interest combined with equal security Their
condition i not one Of exceptional hardship.
Other interests suffer more from the business
depression OF the times and are far more heayi.
ly taxed.
A law of 1874 imposes an annual tax upon
foreign Insurance companies doing bushes, in
tins state. OF two per cent. upon all premiums
received after de1ucting the amount paid for
losses during the yearunused balances on note,
taken for premiums on open policies. all gums
repaid or allowed for return premiums. and
the legal reserve on lie policies. The first a..
sfssment under it was in April last and
amounted 10 el2i3i.,.. Fire aud marine COM
panies were assessed Sl092S 50: life and ac-
cidcnt companies the remaining Sl.j0j.94 OF
the amour. The insurance commissioner re-
ports that the former class received premium,
10 the amount Of $500. 403 SO. and was entitled
10 deduction, amounting to S4Is pol .s:3. leaving
taxable amount of Sji2 .202. 10; that the lat
ter class received Ss13, i0l 81 for premiums. de-
Quoted S34I.1i6.s9 Tor losses paid. and $500
Os92, for other items, thus reducing the tax
able amount 10 $50 .2'S.21. In the case Of life
comp4nles the deductions practically defeat the
purpose OF the law, which was. undoubtedly
Ia levy Just share of taxation upon the large
amount OF capital drawn from the State BY
them.
Although the tax is nominally assessed up
on the company. il is probably paid in all
eases. directly or indirectly, By the holders Of
policies, whether fire or life. II i, certain that
some-and it may be true of all-life insurance
companies make provision in their blank forms
for the collection of the tax from the per-
sons insured by them. An unnst discrimina-
ton, in effect, is thus made by law. Those
who insure their property against fire. pay a
higher rate Of tax to the State on their expen-
diture for protection than persons who procure
life insurance, pay on expenditures for Il rec
ogniZed value in addition to protection.
No system of taxation lhas yet been devised
which is not acknowledged to be imperfect and
inequitable in many respects, and it is not TO
be expected that nearer approach TO an exact
aar.r he 10 81.