Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1890-01-11
The Tax on Mortgages.
CHARLES CRY COUNTY,

To he Editor Of he Dispatch:
Il MIR. III. NJ. Magruder right in his sug-
gestion that land does, under the ciTcum-
stances stated by him, pay more than one
tax: or, if so. does il pay more than per-
sonal property under similar crcum-
stances!
Let us see: his proposition in the Dis
patch of the Sd of January is this:
A has 1900 in money. Is has q tract OF lend
worth $1,000 The rate o. taxation LOT Stste,
county, school, and roads amounts 70 say 81 on
the 500, or per cont. -
A then pays on his 81 ,D00 or money..........flo
II pays on his 81 900 worth OF land. lO
Making total taxes collected on $1,000 Of
values. NEUTRALITY-SUSPICIOUS.. t<U
II the next year borrows AS $1,000 and gives
him a lien on his land for IL. Under the present
system OF taxation there will then be collected
OF A on his mortgage OF BIS laud for 1000 $40
OF b on the 81 900 worth OF land............. ~
OF on the 81 900 Of money borrowed OF A.. 10
$50
And Without cent OF additional value having
been introduced or created there Is collected on
the same old 5000 OF values total OF 80 In.
stead OF twenty. Evideutly the tax on one OF
the two values has been doubled.
And We find tina, b. without being cent richer
than he was the last year, Is paying double
the taxes that he then paid.
MOI cent OF duuitlOuui Ndiic. why
A had in his pocket prior to the transac
ton 81 900, worth nothing to HIM while 1T
remained there Now he has mortgage
of BIS land bringing him $50 year. He
nav be a merchant. The mortgage is
base of credit 1t is value in the mar
ket, and he may be making rs per cent: on
his sales of goods bought on this while
the value" itself carries per cent. lnte-
rest.
The $40 tax against A is based upon per-
sonal property which the state nnds III MS
hands Of cdiue 10 him.
That property is not land in any sense of
tho term, nor does it represent land. 1t IS
bond of b in his hands secured by mort
gage on his land. for the payment of which
all OF the property of Il is bound. 1t Is
paving him $40 year and the State says
$40 of it he must pay to her.
b has not transferred TO A any inte-
rest in his land worth $1,000" He simply,
agrees TO forfeit to A that amount of it If
he fails TO paw him, and the State taxes
the mortgage as it does any other repre-,
sentative of a value which be holds secured
by either real or personal estate.
1t does not tax the land in his hands.
II taxes an interest bearing fund in his
hands, and no burden ofiand-tar is lad on ham.
He is not affected by any increase OF taxes
which may be laid upon the land while
holds it, and it makes no difference with
him whether crops are good or bad or
prices high or low. He carries his value"
IN his pocket and collects his interest This
$40 of the $50 does not come from the
land.
But Colonel Magruder says I've find
that b without beinga cent richer than he
was last year is paying double the taxes
that lie then paid"
If he has taken AS 81, 900, and put 1t into
his pocket and keeps it there. of course he
is not cent richer. But he has. not done
that. He has put it.. say, into bone-hour
and spread it on the land, and Will double
hiscrops, and when the Commissioner OF
the Revenue comes along he has no money
to list, and so don't pay a tax on It at all.
Or, he has lent out the money. and taken
bond therefor which IS not taxed SO long
as he owes the 1000 to A. See, session
Acts 1884, page. 563. The state does not
know and ought not TO inquire where Is
got the money. but only have you got II
1t, like the bond IN AS hands. no Longer
represents lana as Vaiue' ~ attac ,1
to 1t IN no sense. NO more man IL ID hau
borrowed IL on persona, security. s.
suppose 70 Us iaw!ss sn 900 ,a ~ iu -,
both, and that ne mas used the ) .OOo TO IN,
crease MS law hpfary Win OF 70 specu,a;c
IN other lands, &C, 1G i.nd IN these cases ~
ieaves tne inor'sag1u ANY - boar s;rco - loft
II Is not now nor has II neen SINCE II lei.
AS pocke. pait ~ aoaaos N ,nrs ooI
represent leai'ys ~ spertnJ per v;sb - ~
IN ps hanas. ~ ny mas pai Veu WIZ ~, :. 10 -
other properly It's na'ufe as 'aiuo 10
cnnhgea. 81 ho,as III o;,h
III lie mas let IL out anu NOUS MS nclsn-