The Somerset reporter. [volume] (Skowhegan, Me.) 1868-1909, 1890-09-18

| There Is no more responsible officer
under our town system Of government.
the whole fabric OF which may be said
| to rest upon and its institutions To oper-
ate throughlandby its system OF revenues
| Recognizing the vital Importance OF
sound and sure provisions for securing
reuenue, the national government pro-
tects the raising and collection of them
with the safeguards OF its seyerest penal
laws, and the evasion Of tax duty Ina.
posed by the government incurs the pen.
atty Of heavy forfeitures, fines or impris.
onment. The revenue laws Of the United
States exact the most scrupulous observ-
ance OF their provisions, not only az to
the individual who would evade payment
of his dues, but as to the officer whose
duty it is to enforce the laws. The State
laws should be equally premptory In hold.
ing revenue officers to strict fidelity in
| their enforcement. Our Maine ASSESS
ors are unquestionably as able and eff
cient as any and the fault is 10 the loose
ness of the tax laws. Yet 1t has been
the custom for assessors to ignore the
explicit requirement of the Constitution
of the State above quoted Property Is
assessed at much less than its just value
In most towns. 1t Is very common for
assessors to value real estate at three
fourths, two-thirds and even one half of
its true value. In the returns of the as
SCISSORS of all the towns of the State for
the use of the State Valuation Commits
sioners it appears that the assessors of
1872 towns based their taxes on less than
"a just value" OF the property assessed.
Thirteen based them on four-fifths value;
thirty-tve on three-fourths value; fifty
three on wo-thirds value, and sixteen on
one-half while in two towns the ASSESS
ors considered their duty done when
assessed upon one-third of the leash
value" of the property taxed. 1t has
been our purpose to make the assessor
the important and responsible officer that
he should be under our system and yet
to make him the executor and servant of
the law and not its superior. The pro-
posed law therefore leaves but little dis
erection in his hands. 1t points the way
and commands him to follow under Sc
we're, penalties for neglect or malfeasance.
1t holds him rigidly to just valuation,
with no discretion to construe that to
mean half value, and 1t is equally ex-
plicit in forbdding any international
under valuation or generalization in any
case or for any purpose whatever
tax of $500 between the ages of 81 and
10; imposes a tax Of $500 on male and
$500 on female dogs to be applied in
payment of damages caused by dogs to
sheep; takes from selectmen the power
to act as assessors in towns or more than
1000 inhabitants and grapples with the
mortgage double tax subject, by making
the mortgaged estate taxable to mort
gagor and mortgage according to the
value of their several interests in it and
relieves the mortgage debt from exami-
nation altogether. On the
TAXATION OF MORTGAGES
the report says.
ave have given considerable study to
the vexed subject of the taxation of mort
cages. To tax or not to tax them Is a
many sided question and most difficult Of
satisfactory solution. 1t involves the
whole theory and practice of general
property taxation. The injustice of tax
| ing a mortgage is that 1t results in double
taxation. II the real property mortgaged
is taxed and the debt secured by 1t is tax
ed also, the mortgagor is compelled Oft
ten, to pay double tax because the lend
err of the money, the mortgage, may and
usually will make his contract to cover
the tax he may be obliged to pay on the
mortgage indeltedness and the mnrtnaQ-
ed property is taxable to the mortgagor.
This liability to double taxation extends
to many cases where no money passes
aud the morgaged property is the only
property involved.
ITO tax both property and credits, to
the lender and borrower, is plainly incor-
rect in principle and inequtable in prac-
tice." says Amasa Walker, author of Sci
ence of Wealth.
"On the other hand, If mortgages are
not taxed, the money lender escapes tax
alton for the money he has loaned on
mortgage altogether. How to adjust the
tax so that exact justice may be done to
both borrower and lender and to prevent
the falling Of all the taxes upon the bor-
rover is the problem challenging solu-
ton, and one which must remain without
absolute settlement until the law shall
usurp the power to make contracts be-
tween borrower and lender, or until all
taxation shall be removed from intangi-
BILE property and chooses In action. 1t Is
not alone the relation Of mortgagor and
MORTGAGE that produces the injustice of
of double taxation. 1t inheres in the
whole system of taxing deeds and secu-
|
sor Is Indebted. 1t touches the interests
of all who do business; it is peculiar to
no class and Is a grievance as old as taxa
tlon itself. In the earlier days of our
Statehood. 1t was but little felt, but in
the mutiform methods of doing business
at the present day 1t Is oftener felt, and
the eyasions, subterfuges and frauds
paactced to avoid taxes upon credits
and securities, are the chief cause of the
effort everywhere made to find q better
system. 1t Is an almost significant fact,
and one which speaks forcibly of the
impracticability of statutory relief from
double taxation In case of mortgages,
that there has been so little accomplish
ed In any State to remedy It. In many
States. as In our own, the taxpayer Is al
| lowed to Offset against debts due him an
equal amount Of his Indebtedness, and in
| few States he Ia allowed to Offset his
| Indebtedness against his valuation geuer
ally. In Massachusetts and Maryland
the legislatures have undertaken to de al
with the subject of mortgage taxation
and In the latter State mortgages are not
taxed. In Massachusetts the mortgage
Is taxed as joint owner with the mott
gagor In the land mortgaged, to the ex-
tent Of his interest. This method was
huOpLcu uuucT Sthbc tUaCltu III 1901
andhas proved reasonably satisfactory In
practice. The mortgage is taxed to him
as real estate to the amount of the debt
due him upon 1t, and the mortgagor is,
to that extent, relieved from tax, as he is
taxed only for 80 much of the value of
the property mortgaged as Is In excess of
the debt, thus making but one tax. in ef-
feet upon the whole transaction, the
note being free of tax. Thus the lender
is taxed for the money loaned in the form
of tax on his interest In the mortgaged
property and the borrownrer is relieved
to that extent. 1t is easy to see how, un-
der this system, property escapes taxa
tion in theory at least, for II the lender
retained his money and the borrower his
land both would be subject to full taxa
ton. But would the money be found
for taxation7 1t Is also apparent that the
lenders facilities for shifting the burden
Of the tax he is liable for to the should
Gers Of his debtor by extra charges still
remains. On the whole, however, we
conclude that the weight of the argument
is In favor of some such method as Mass.
achusetts has chosen, A. compared with
our own, and we have Incorporated into
our proposed law provisions of . like
character. We are unable to devise any
method that promises better results"
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