Port Tobacco times, and Charles County advertiser., 1886-01-29
The Taxation Of MOrtga ges.


The question of reinstatins the tax up
on debt. secured 10y mortgage, a. it exist
ed prior to 1870 whtn it was eAtin.uished
by act of assembly, will soon be again
under consideration in the Legislature I
This question has been. in recent years,
considerably discussed hy The press of the
State and some relevant and wholly un-
tenahle propositions have been injected
into the discussion.
Among these were the propositions that
mortgage de1ts are not property, and that
a tax upon NOR gage debt would Involve
A double taxation of the same property
The falsity Of these propositions have be-
come - apparent that they have become
pretty well elimina ed from the discussion
md will probably find no place in the l"g-
lslative debates upon the question.
The legitimate discussion Of the qucs
ion is now narrowed down to one simple
question, and that is whether the scarcity
# capital AS compared to the opportunl-
ties of investment and the needs Of the
agricultural classes of the State, which IN
1870 led IT, the exoneration of this class OF
securities from taxation, still exist 10
exemption of mortgage deb 3 from the
| burdens Of taxation.
While none but superficial students OF
tie question will sravcly contend that tie
Legislature has not the power otaN mort
gage deb's rs wei as all otter interest
bearing securities, no one we'll informed
IN regard to he matter vi | drny that It
is within the law making power Of the
government tn exempt This or any other
species of property from taN,tion, "Aere
ever sufficient reasons OF just pn icy de
mand sucn exemption.
1t seems to be general Y conceded that
the sta'e of affairs which existed il 1870
was a sufficient iustifca ios for the action
Of the Legislature in then exemp'ins such
securities from taxation. At that time
Investments of safe character and at a
high rate Of interest were abundant. The
United States 0 pei cent. bonds were ob,
tsinab'e at about par and other ssfe and
profitable investments were To be had on
all sides. The farmers OF Maryland, and
especially in this part Of the State where
they had Just been roboed of large
amount OF property. were greatly IN need
of capital wherewih to carry On their
asricui' ur2l operations. Il fact they were
compt He'd to have il and capitalists were
in a situation to dicts'e their own terms
The legal rate Of interest IN this Stat,
|. was and is per cent The State ani lo.
. ca tax upon property n this section 81
the State was At that timn a ht.le over
per cent, and is now per cent The
nat rate Of interest. therefore, which &. cap
italist who loased money upon the secu
= rity OF and mortgages would he ahaT:
PR cent or less Although usuTIoui
} agreements could b9 aud were frequent ,
entered into hy which greater rate thar
F, the legal interest Mss secured - the lcnd~
! vet, IS the capitalists well kanw, Z es'
!, agreements might oe avoided by the b"r
: ROVER at any time before the loan Va. p-i.
and they did not care to take such risks
I Hence II was that there VS.. little chanc
fal .ls IaI11.a-II -aaI ~ asl ~ .lla ! -
- rate in this State. uaiess h. a.sau-,l i
D pay the tax upon the d ,b'.
: Ia this state of iscts tbs Lasi. A,urc ev
emptei m"rt2s ges from t.1a.i.u .nl ia
: wisdom o: their action ~ that q ne seem
to be generally corccded. Many psopl
| rho are snxious to increase The ,ax.b,
: basis # the State are now. however. o
= opinion that ibe much cas;.r state Of III,
, money market now eIis ing and the great
or competition for safe investments anon,
, capitalists will enabls hul o sn-r. to con
! ;lnue existing loans and negotiate nov
ones on the credit Of th.ir lands vithou
assuming the paymen ofth hetsx
, Tax Commissioner Woolford in hi. re
port fully expresses tie opinion tha. III,
condition of the financial marks, which
: prompted the exemption of mor,:es.
J from taxation in 1870. has now Certainl,
PASSED away; and that seems to bs tn,
correct opinion. Assuming this opinion
} TO be correct, and the duty of tie l.c.isl4
ture to reinsta,e the tax upon mortgage
as it e1i.ted prior to 1870 is clear.