The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1881-03-03
rxempt,ng Bonds from Taxation.

o,e hrnarcd dollars in value, While D.,
whose property is Invested IN State bonds
NAYS nothing" No more could anybody
else Il that were fair sts,emsn' OF tue
case Of the capitalist whose bonds are eN'
emn.ea nv iaw from taxation. No nation
whose citizens enjoy the right OF s"pr'Sc
would tolerate such state OF Things ~ '"'
exemp,ion OF the rich mans BONDS iIol" d
tax imposed upon poor mans ah' h""
because IL is next 10 Impossible 10 s'''s''
Tho average voter that the man whose
bonds are By law exempt from 'aA'''o"
does nay. or has ever paid, any tax upo"
them. il IL unwise TO exempt bonus i'o"'
taxation. II ought to suffice 10 make '"o
con,rac, between the State and It's creditors
,osd ,h,, ,be bonds should not be taxed NJ
ary hiehcr rate than that imposed upo"
other property.
So far AZ bonds arc concerned which nave
ALREADY been issued under law eXcmptlns
them from taxation, no question ought 10
be raised. A contract is a contract, and the
courts OF the country will not allow one 10
be violated. l. is, therefore, not necessary
for any party In Virginia or elsewhere 10
Join issue upon the question OF the laXatioh
OF bonds already exempt by law. Wheh
sny new plan OF rcadiu,tment shall DC pro-
posed, and shall include either PROPOSE
ton 10 exempt the bonds from taxation OF
proposition TO tax them, 1t VIII be time
enough 20 draw party lines on the subject.
We design just nov TO discuss the abstract
question. The fact that The United States
Government is expected soon to borrow
seven hundred millions OF dollars at per
cent. interest will serve to illustrate the
argument.
All Uniled States bonds are exempt from
taxation. No state, city, or county Is al
lowed 20 tax them. WhCeyer, therefore,
proposes TO tax state bonds in violation OF
the conditions upon which they were issued
must. il ne desires to be consistent, propose
TO tax United States bonds in violation Of
the conditions upon which these were
issued. There are more than hiiees nun
dred millions Of dollars Of these Litter
bonds. or fifty times The amount OF the debt
OF Virginia. We should like to bear one
reason given for violating the contract made
by Virginia which would not go just as far
10 Justify the violation Of the contract made
bv the United states. We commend this
poin, 70 Judge HUGHES, Judge RIyEs, and
any Of Der Republican who Is in favor OF q
coalition with the Rcadiusters for the pnr-
pose Of carrying Virginia next iali. we
also commend it to any Democratic he-
adjuYer whe may feel inclined TO form a
coalition with the Republicans. He Will
find himself in a singular position when he
shall ally himself with men who are Wiling
TO eyemp. hitecn hundred millions OF dol
lars of United States bonds and unwilling
TO exempt thirty millions OF virginia bonds.
But : il true that these bonds contribute
nothing 10 the support Of the Government
Let the United States Government issue
three hundred millions Of per cent. non
taxable bonds and three hundred millions OF
per cent. taxable bonds, and the question
will a: once be answered by the facts. The
non.tayable bonds will sell at par. For
every dollar expressed upon their face The
Government will receive from the lender a
gold dollar. But not 20 with the taxable
bonds. These would ell down to the lowest
point to which the possibility OF nigh TAX
could sink them. Let us suppose that they
were offered for sale in Richmond, and de-
cared 10 be liable TO a tax Of two dollars on
a hundred, which is about The average tax
in this city. II the bonds were asst ssed at
their iace.value they would be liable TO Il tax
OF per cent. out Of On interest OF per
cent. In other words. the purchaser OF the
bonds-ihat il, the man who lent the Gov
eminent his money-wOuld receive l per
cent. per aBnum interest. 1t follows that
the bond would.sel for next 10 nothing.
VIII It be said that the bond would not
be taxed upon lis face-yalue but upon its
selling price! All! Then the tax would
have been collected already upon those for
which the Government had received their
face.value. A 3 per cent bond brings into
the Government treasury dollar for dollar
If exempted from taxation, but next TO no.
thing il taxable. In other words. the man
who pays par for per cent. bond does to
tii lHlIHA5 "hN I"i F''N" t"' ~" '"~NN" ~
advance.
Or lei rs look al the question in another
light, II the non-taXabe bond bore per
cent. interest and sold at par, a taxable
bond would have TO bear per cent. inter
est in order 10 make it sell at par. Thus we
see again that the lender OF the money pays
his 3 per cent. tax in advance. He pays The
Government par for bond for which, If II
were liable to taxation, lie would pay as
much less as the tax would render 1t ncces
sary for Dim to pay in order to get a. good {
bargain as be would get in buying ) pei
cent non.taXable bond.
II man has a hundred thousand dollars
invested in real estate. or taxable bonds, OF
other property, it yields him return OF say
5per cent, and he pays . per cent. in th'
shape Of taxation. lie has left just what tb'
bondholder has who paid all bis taxes in nd
vance.
In word, nobody would be foot enough
10 invest a hundred thousand dollars il
bonds yielding only $4,000 year unless
those bonds were exempt from taxation.
The Extra Session.
Tho XVos binOton Post saws that lhp acti IN,