The great West. [volume] (St. Paul, Minn.) 1889-18??, 1890-01-24
Railroad Taxes.


Railroad Taxes.
The GREAT WEST addressed letter
to Senator Pope for information rel
ative to the committee-work of the
last legislature on railroad taxation.
The following is his reply. Mr.. Pope
made his position clearly known at
the State Convention of Business
Men at Mankato two years since
and he has never deviated from that
attitude to our knowledge:
MANKATo, Mimi, Jan. Is, 1890.
The GREAT WEST:
DEAR SIRs-Your favor of Dec. %,
inquiring regarding the investigation
of reports of railroads, to the Rail
road and Warehouse Commissioners,
was duly received, and owing to
pressure of business at the close OF
the year, was laid aside and was only
reached by me to-day. The Senate
Committee appointed for such pur-
pose confined their investigation to
the object of ascertaining on what
basis the various railway companies
paid their tax on N'gross earnings"
having special reference to earnings
OF telegraph and express companies,
and other common carriers who con-
duct business over the lines of railway,
in pursuance of agreements made
with railway companies, who them
selves conduct business under the
franchise granted by the State. In
that connection it was ascertained
that some of the railway companies
of the State conducted their express
business through an independent Or
ganization, in, and of which, the rail
way company was the sole stock
holders. Others, and the greater
part, conducted their business under
contracts made with the express
companies.
Most OF these contracts provided
that the express companies should
report to the railway companies their
gross earning within the State, upon
both state and Interstate business
transacted on the line of such rail-
way, but in no case did we find that
the railway company reported to the
railway Commissioners the gross
earnings upon such business.
Their practice seemed to have been
to have reported and paid taxes up
on the net earnings instead of the
gross earnings, which latter, in our
judgment, was contemplated by the
law.
The Senate railway bill, (which
failed to pass the house,, contained
clause which would have made it
the duty of therailway companies to
have reported the gross earnings OF
such common carriers which were
made over their lines, and under the
privilege of their franchise, and chap
ter 235 of the General Laws of Min
nesota, contains a proviso defining
the meaning Of tibet "gross earn
ings'' which, it is supposed, will be
binding upon any railway companies
which accept the proviso of that act.
Chapter 191 of the General Laws of
1889, repeating chapter II of the
General Laws of 1887, was also in
troduced and became law harmon
izing with the objects which we had
in view. Asyou doubtless understand,
chapter II of the General Laws of
1887 make thepayment of this gross
income tax compulsory upon the
companies. While prior to it's pass
age it was optional, and in the nature
Of an agreement between the COM
panies and the State, and the law
compelling the payment OF tax upon
gross earnings, could only be enforc-
ed as to the earnings upon business
commencing and ending within the
State.'' This in the case of the most
of our railroads, express and tele-
graph companies, would be very
small portion OF the earnings upon
business done over the mileage in the
State. Therefore it's repeal seemed
very desirable, and for this it was
thought a vote OF the people was
needed.
It would seem that, from some
source, tax should be paid to the
State upon the gross earnings of all
business of common carriers which is
done over the lines of railways of this
State, which have accepted provis-
ions of the acts authorizing the pay
ment of tax upon gross earnings in
lieu of all other taxes.
I wish to avail myself of this op-
portunity to acknowledge the priv
lege which I have enjoyed in reading
your publication for some time past,
and enclOses$1 90 as s11hscrintiOn for