, 1879-06-16
STATE RAILROAD TAXATION,

Adams before tho Convention Of Gtnis
Nnilrnnd Corn,lsstonora.
sAnaTonA, N. T., Juno LITTLE Convention
OF State Rai1road Commissioners met again. 4
report upon State railroad taxation ani the gen
erat principles OF proper ayktctn to substttut,
therefor WAS read bv Charles Frauc,s Adams
Jr.. In behalf OF t!e Committee Of wllleh he !,
Chairman. This report which is printed In full
hclow, Is preliminary to moro detailed docu.
ncnt which Mill be submitted later.
TIE coMMITrEE's nEronr.
The COMMITTEES appointed at tho last Cunycn.
lion 81 Con&Inifstoncrt 10 examine into u,ml re.
port the methods OF taxation as respects raft.
ruatls al,d railroad securities nnw In use In fho
yarious States Of the Union, as well az in
foreign countries, an,, further, to report p.an
for ~ equitable md uniform sys.em oi sucl.
thxatfon at the next mratng of this Convention,
present the following preliminary report:
Shortly after the last Convention Of Commits
s!o'cra your Committee Issued circular anil
ACCOMPANYING intcrrogatorlcs whirl, were sent
number Of THO leading railroad cor.
tho courtesy OF the State Department.
Ut Washington The representatives Of
tle National Government Ut the princinat capi-
tails tn Europe wcro also called upon Tor infor-
nation on the ra!lwas-tax systems there II, use,
AZ reault, some. sixty answers wcrr, In ulI. re-
ccycsl, covering tlr ynrtuus Status OF the Union,
Canada, England. Belgium, Holland, urrmany,
Russia, hwiizcrlanl, mud Auatro-liungary. An
hHt~cr IL still to be received from France The
Information contained In these answers ls nluch
Of It of great valuc. presenting jat0e body Of
facts bearing directly on subject OF gcneral
interest. Your Committee. therefore, now pre-
ssnt merely preliminary rcport,, giving The
Kons they hnyo dcduccd fran Them, rcseryug Il
more elaborate presentation Of the subject Tor
another time.
An respects the system of railroad taxation
nov IN use, the answers received bY your Com
moro varied than had been anticpatc,1, or than
would lc supposed to be possible 1t 11lsy b..
said that there ia no ono principle running
through the various srstcms described. and,
poss!ble 10 be devised which is not at this time
applied 10 railroad property in son,o part or
this country. So FIR rs those now we'll rccoc-
ntzcd principles, which should bo at the basis OF
aIl systems OF taxation, are concerned. ttav
would, as rule, seem to hayo been utterly tg-
nored. In two adjoining States, for instance,
WITH roada belonging to onu co1upany opcrat-
ing In both. will be found on o,lv side Of the line
a system simple. direct, equitable, tn,posiu. Il
moderate mud 9xed buslcn, fratn which there ID
the who'e subject IL still ASoyeI in TINT. orsgi. W
mi cruhcncss, with gucss work Tor i,s only basis,
Nllch marks all these pateh wEk Aystcns Of
taxation which havc been tmprovhcd since 1876
W kutGt ll!e AI0MHE HEtu9 u ptNQ :lllH local
treasures, without any regard to principle Or
study Of the snb}c2t, on tho ponu]n but fnlFa-
ctous theory TINT anv one knows ono,gt1 to i'm.
poso taxes In certain Suites tho ralroads aro
apparently looked upon as Il species oi witll-fali
from whtch everything which can be e:actyl In
the way of taxation is 80 mitch pure lain. In
other States they escape with very slsht anil
wholly dEsproport!onate burdens. THIS fran
chtse ta1, the gross nnt not earnings ta, tho
pcrsonal property tax. tho roasy tax, al, all
~ <k}f ft1s1fd dhu{ur 1iESmt 4fxi
times BY local boards, sometimes by Doar Of
State Equalization, but almost inyariuhy In It.
ter disregard OF aDy principte. A fnoru atriktn:.
afid In Boinc respects dtscoltraGlnE, example u
general confusion aa regards All important mat
ter Of flscal legislation gould hardly he -tmag-
tncd. This will more clearly appear from Tho
condensed statement OF the several systcn,s
now 1u use, which thu Committee propose to
Incorporate In their complete report.
AZ respects the conclusions reached az tic re-
aut of their Investigations, they can bs yerY
briefly stated. Tl,u requisites Of i correct sys-
ten Ut railroad, As Of other taxation Is that IL
should, In 50 fur u 1t y possible. bc s!.npls,
fixed, proport!onate, easily Rsccrtalnahle, aud
tens now In uae wure found to havc anY Of
these features. So fur frutn being fixed, they
are, most Of them, extremely arbitrary aud
Neither arc they propJrttnphtct ~
In some cases the measure Of valuation il 1lte
maskc&n!icn Of sccurttlca; In others, the arbI-
tsary estimates oi aporalsess; III yet others,
Kroes recepts: Anl In oillGrs, local assessment.
That the tax should he almost impossible OF as
eertninmeut unleE lliesa circumstances DOES not
need to be sail. As TO bollE susceptible Of
ready levy. RuY Tax a8scAsed on and paid hy o
railroad corporation must be thai, but II would
Appcnr tlIat large portion OF. the tnxes now,
lusicd must either DO eyaled or elso aro In tlu
nature NJ double tnxat!on, for tho securities
on which they ara levied are, In the cyo, OF tho
law, persoual property, astcssable At tho rcsl-
dcnco Of tho owner. Local taxrs naIl by tho
tu onu State do not affect these &C.
curftlca II hcld IN another, and they arc thus
anblcct to IN additional leYy, tho amount Of
oer o psosrt1 q! tho
tax-gatEtrcts. Tho conclusion nt which
your Committee arrived wa8 thHt ali tile
rcqulstted of souna systaIn wera found
In taxes on real property. ana Oh gross
vera properly lmnosed no other ta1es wotll DO
,eccsssry, as nothing could escape ubtaxed,
Under this aystcn the real cstat0 Of lhs rail-
road corporations held for corporate uaea out
stdu Of 'hsir right Of way would BE- locally as.
dessed exactly Ia tho same way as tho real
cstatc Of private persona or Of other corpora
tiona adjoining 1t was assessed. Theirs would
be no no distinction lnatle 10 REGARD tn It, 1t Is
tho ordinary lax on real property: lscsond that
o ssns[a shoua 6s
on the entire gross earnings Of thr corporations,
md this should bo In llsH OF nlt forms IT taxa-
ttnn GU what Is knnWn - personal property.
Under ths sy.tsn ths rolling t1oes Of tho cor
lands, nor. It's securities, whether stock or
bonds, either Indirectly through tho
or directly In the hnnds
II those. owning them. Tho entire bur-
len, be The same more OF loss, would 1s In
ed directly. It does not need 10 be pointed nut
tllat this system Is perfectly simple; that under
I tt1ation y fxed by . general law and not by