New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1880-07-13
New-London and Newport. He will be absent
STATE TAXATION OF BANK STOCK.


BANKS SEEKING To SET ASIDE THE ASSESSMENTS
FOR 1ssO-CoNFusED CONDITION OF s1AfE
IAws--TuE RECENT DECISION OF THE UNITED
STATES SUPREME COURT.
Tn beginning proceedings to review the action OF
the Tax Commissioners the banks OF New YORK
claim that they have been animated only WIN
desire to protect the Interests S state 81 .n0r
of banking capital has been, excessive,
but the banks have borne the burden
of earning fair dividends. after paying the heavy
taxes. has led TO the withdrawal of large amount
OF money. The combined capital OF the eauRs OF
New-YoTk has been reduced since 1873 about
500 900 600. and the surplus earnings aoouI
81, 600 900. Many banks which have not reduced
their capital have paid only very small DIVIDENDS,
hope of legislative relief prominent BANK
officer said yesterday that the loss of capital suffered
within the last seven years would have peen la'a'
The banks have been taxed under the provisions
of the State law OF 1868, which laid personal Tax
banks were compelled to retain 50 much
Of the dividends due the Stockholders as
would be necessary to pay the tax; NO uS,
auctions for debts, which are allowed IN
all other personal assessments. were allowed under
this law There could be no allowance RON lne
valuation. which was determined by the amour.
of CAPITAL aud surplus. The consequence
Of tbs law was that banking capital
bore a much larger part OF the pubic
burden than other KIM OF personal pioPci'S'
ITpon the ground of excessive taxation, the legaty
of the act of 1866 was tested in suit brought Dy
an Albany bank The law was sustained Dy inc
State Courts including the Court of Appeals Inc case
was carried to the United States Supreme Court,
which decided in effect that the State act was In
conflict with the National laws regulating banks.
Ii decided that limitation exists under inc
Federal laws which forbids taxation OF Natlonal
hank shares on that basis which the Conrt OF APP
meals held to be prescribed by tue act ITSELF IL IS
said therefore, that the Tax Commissioners nave
apparently power from the otate
70 assess these shares except in a manner
which the State is not authorized to prescribe. On
fine mart of the banks il is insisted that under TINS
decision of the Supreme Court the act OF 1860 rs u
dead law; that the state Legislature practically
confessed this fact in reenactIng az It's last
session the act of 1866 which was modlhed so Iar
as TO give deduction for debts. 1t IS said that the
act of 1850 is identcally the same law so lar as
ANYTHING was lef. of il by the Supreme Court.
The assessments for the present wear were MADE
under the former act, and the banks no"
seek TO review the action Of the commissioners III
leyying the tax. 1t is claimed that IN the absence
of valid law theercan be no legal tax. BY every on
the question is admitted to be important. On one
had It is charged that the banks are seeking
under n technically to escape taxation; by
the banks 1t is urged that they do not seek
immunity from taxation, bat they are bound 10
protect the interests OF their shareholders.
They claim also that having paid an excessive
tax for fifteen years they ought not new TO be
blamed for taking advantage oi the law that thoS
must be Just before being generous.