New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1877-11-28

the taxation of National banks:
The internal Revenue law OF Juy l. 1867
imposed taxes upon almost the entire property e9d pro-
ducts OF the country The amount OF internal Revenue
collected during the fiscal year ending Juno 30, 1866
was nearly S3IOOOO,OO0 The act of July - o. that
wear largely reduced this amount, and still further re-
ducton was effected by the legislation OF the following
years. which exempted from taxation all manufactures
and products except gas spirits tobacco and fernented
liquors The entire Internal Revenue is now derived
from taxes upon the three last mentioned articles upon
such articles require the use OF proprietary Stamps
and upon bank deposits capital circulation and checks
1t is difficult tO understand why tho tx upon the de-
posts OF the banks-whch tax, like the others, was e
sontiay tax, not repealed az the same uho'
unless because Of an unjust prejudice against banks
which peculiar to this country and which Is trace"be
to the large heretofore sustained y the people
upon bank currency formerly issued under the authority
OF inud.cious laws OF many OF the States.
The deposits Of the banks which at present amount to
about - 600 OOO considerably more than twice
the whole amount of the paper currency ana coin IN the
country. They not money, but merely represent
commodities which, large extent are not subjected
TO National taxation. The wheat and -four which are
shipped from Minnesota tho East taxed in the
banks of St. Paul II their ayas arc represented by Dill
OF exchange upon Chicago II the same commodities are
re-sluped from Chicago 10 New-York. tax IL asan
imposed IL the former city upon their representative D
OF exchange, and again IN New YOr. when they are eX
ported a foreign market Tie same Is true OF tle
fscturcs sent rom the Now-Tugland and other States
RRPRAL ADVOCATED.
TIE State laws generally authorize the Indebtedness OF
individuals to be deducted from personal property re-
turned FOR the purposes Of taxaton but the tax on de-
poss is on the contrary tax upon the indebtedness OF
the banks, and not only upon their Indebtedness
to private individuals and corporations, but in
the case OF dsbung officers OF the United states 10 the
Government Itself. The banks therefore, pay tax not
only upon capital and circulation, but what they
fIto Inr,1r sIyn k.qu on
hand a. permanent fund, from - to % per
cent Of their deposits; and these reserves, which arc
held without profit the banks. and solely for the
security their bhoders and depoors, are also sub
ieced 10 tax The injustice OF such tax would seem
TO be apparent.
The banks are a monopoly their stock very
largely held by rich Of the country but it ia dis
trlbuted quite generally among people Of moderate
means and who need for their support regular dividends
upon the small amounts of stock which represent their
accumulated earnings. This fact he seen by refer
enc 10 tho carefully prepared tables thi. subject,
given in my last annual report, where II appears that
then 4sG and That the average amount OF stock held
by eacn shareholder was hut abont 80 100 More than
onshaf these shareholders held eaeh Dut Zen safcs
Isl OOO) or less each mot 10 exceed $1,000 whie the
entire number holding moro than tGD .hareS eacs gag
whole number desarehodcrs and OF these but 7C7 only
held move than 500 snares each.
The resources Of the banks reported regularly 20
ths Controller in statements and are published IN
The new spapera Of nearly every village in TIC country
Tey are also presented annually the report OF the
and are therefore accessible TO the assessors
Of every town that the banks can neither eyaie tax
alton or deceive the authorities, resort 3" any OF the
lie which ether corporations and MANY private IN
pay large percentage Of the taxation which should In
justice. be imposed upon other capt but when ley
cannot cyado unless they diminish ther capital or sur
reDder their business -, -
upon banks is that they enioy SPECIAL privilege But
to only real privilege which they 10 that ~ ssu-
ing circulation, and even that X not aresroted pVege
u il one open all who lit 10 engage 10 the business
Of banking Moreover the profit upon circulation does
le cent 9a IL i95"e mn u' II = nor great Source of in
come is evidenced by fact tha the banks have since
the passage Of the Act OF February H. 1879 voluntarily
500 900 900 The state have increased 10 such
an extent in recent years that 10 many the Cts lucy
alone are equal to 2and sometimes cent Of the
canta OF the banks and instances knoP ~ ere these
Institutions pay four ahs OF the entire eisonal taxes
OF the community wherein they are located
INEQUALITIES OF TAXATION.
They report the total assessments personal property
I'm the City Of NawYork for the year 1873 Mt $2l73OO
1874 OF which S7339O.9s9 was upon bank stock total
assessments for 1876 S21s G2G179 Of which $50 l41
III was upon bank stock total assessments for Is"
s2O6 O2s l6O Of which S73,6l427l was upon bank
stock The number persons assessed oher thah DanA
shareholders in 1873 was $500; in 1876. 9,233 IN
1877 1879 The number OF shareholders of banks As
ssed upon their stock was in 1878, 1926 in 1876,
2569S In 1871 24,6i9. The reduction OF the number
Of shareholders and OF the assessment upon banks IN
1877 was due to the reduction OF capital and surplus
| caused by excessive taxation
The capital and surplus Of fire and marine insurance
companies IN New York, III 1874 S5s,G7O,OOO. bat
they were assessed at less than $7000O0O The total
capital of incorporated companies ana ASSOCIATIONS as
estmaed in 1871, by q CON llaslcn appointed Nv me
5S5G5OO GOO, exclusive OF surplus ana I'm
divided profits Tho total n OF these association
in s7l was Ouly $i3O,oOO,OOO or when the BANKS IN
NewYork Cty alone paid 70 Per cent IL the capital OF
otner associations wcro assessed IKE bank $40 H. NJ us
true yalue proportional assessnient OF tue Danks
would BE- but II per cent Of the WHOLE instead OI - PeI
| cent az 20 present. -, o.. -,
NeW-York foreign capital transmitted u thar Statc 10
! Je loaned and employed IN business, II exempt Hoh
taxation. National bank with capital OF T3OOooOO'
paid In 1876 amounting 10 S2OOoOo or Al tle Ilt
OF per cent on its capital, While foreign agency en
| blowing "a equal amount OF capita. paid nothing
Ten banks city III the state OF Newly osk, having z
population OF 10000, pay tax upon S2,15OOuO when
is than their aggregate capital; While tho hbslc-
gate personal property OF all other corporations aud IN
diyduB In the city, the true Naue Of which ~ esua
AZ 5000 900. Is assessed a. but SJ9OOOO Inc DARK
stockholders Of that city numbering ia OF "ho ihor
than third women, hold each an average OF
GOO " stock 10 IL estimated that at least 3OOO ohor
persons that city pOs5ess personal property amounting
TO $1,000 each These persOns either escape taxation ~
$500 each. The holders Of bank stock, thoIelore, ~
that city pay tax AT least ten times greater imam lhe
holders OF stock la other corporations.
STATISTICS.
The following table exhibits the amount Of taxes pad
nv the National banks TO the United states yearly from
Tie organization Of the system to July /, 1871 the rate
OF taxation being per cent annually upon the aver
aga amount OF notes In circulation one half OF one pei
cent annually upon amount Of deposits ana
ike rate upon the average amount Of capital stock mol
! invested in United States bonds
Year ON Circular on Dep9sits on CagitiE AggeslIo !,