The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1891-06-03
THE TAX On CORPORATIONS
MUCH GREATER UNDER THE NEW LAW
Smith Riddles the False
Statements OF the "Journar"-The In
crenses Under the New Law Very
Promlnent-New Law n Good One.

Nlgor. among otner Things ne said:
Since the passage Of the new tax law, which
was approved March 9, 1891, the Journal has
labored to convince the public that corpors-
tons were unduly favored by Its provisions, in
that as TO them the taxes have been reduced,
while as to the farming and laboring classes
they have been largely increased; and if there
were no other evidence that they have been
trying to mislead and deceive the people about
this matter, the editorial columns of their
paper during the last three months afford
ample proof of the fact. The Journal has
stated as fact that the taxes corporations
have been reduced from 90 to 80 per cent. and
I increased on other property at least 50 per
cent.
Such a position can only be attributed TO
! Ignorance of the law or willful dishonesty in
constituting il.
But | am inclined TO favor the Journal with
the presumption of ignorance of the provisions
OF the tax law, however much it may choose to
malign my ability as q lawyer knowing the
law, the Journal engaged in dishonest effort
to msconstrue it and deceive the people. The
columns of that paper gave solemn proof of
this Tact and the presumption Is that 1t has
done so 10 mislead and deceive the public and
make political sentiment against the demo-
cratic party.
As evidence OF the truth of this proposition
the Journals editorial of today is master
piece. Being compelled to answer a letter of
mine published in the Upton Times, it has
resorted to msstatement to sustain It's former
position on the tax question. The Upton let
ter states the plain truth and it is coroborated
by dozen or more editorials published in the
journal since last March.
/ shall prove that it:is not only wrong, but
Intentionally and purpOsely wrong, when it
charges that any class OF corporations has been
favored in the new tax law.
IL is stated in iodGy's Journal That the taxes
on express. telegraph, telephone and sleeping
car companies were reduced by the act of
March o. 1891, from 90 TO 50 per cent. below the
rate fixed by laws 1889.
This is not true. | assert that the laws of
1889 did not produce any revenue to the state
worth naming. and that the act of March 6,
1891, IL the only law ever passed by the legisa-
ture from which an undisputed tax the earn
lngs OF corporations may be expected real
ized
The law of 1891 not only taxes The gross earn
ings OF the corporations named, but their
tangible property a. well. IL not only taxes
what these corporations earn on business orig
mat 1lg and terminating in this state. but il
reaches earnings OF business extending from
other states into this state, and from this into
and through other states. When was this done
before?
1t will be useful to compare the laws Of 1889
with the tax law of 1891. l give the following
careful statement:
The act of March 9. 1889, concerning taxa
ton OF express companies. liked tax of per
cent. OF the gross earnings of such companies
state of Indiana.
Telegraphic companies were required by the
act OF March II, 1889, page 3S9 to pay tax of
per cent. on the gross earnings on all business
oIlginG ing and terminating in Indiana.
Telephone companies were required by the
act OF March H. 1889, page 397, TO pay tax OF
per cent. on the gross earnings OrigindttRg
and terminating in this state.
Sleeping ear companies were required by act
OF March IL, 1889, page 39S to pay a tax Of 10
nj m Nha
originating and terminating in the state of In
diana.
Secs 6S and 90 Of the act of March 6. 1891.
provide that telegraph and express companies
shall make and deliver to the auditor of state a
sworn statement showing the entire receipts of
each agent in the state for the year ending
April l, including the proportion of gross re-
celDts OF such companies earned or charged,
whether actually received or not. These Sec
tons do not conhne the company's liability to
earnings on business begun and terminating in
this state as the law OF 1889 did, but on any
business which has it's beginning or ending In
this state, 10 illustrate: the earnings on q
package or message from San Francisco to I'm.
diauapOls must be accounted for in this state
for the purpose OF taxation. Upon these earn
ings the company must pay 81 on every 500 OF
gross receipts.
BY sec. 40 telephone companies organized
under the laws of other states and doing busi-
ness in this state. are required to make SINH
lar report OIL the gross amount OF Gil their
receipts in this state; that is. on all business
done by such company between this and any
other state or exclusively within this state.
And upon such gross earnings there Shall be
paid to the state % cents on each 500.
BY sec. II sleeping car companies are re-
quired to report the gross amount of their
earnings within or without this state for
money earned within this state; and in CON-
putting such gross receipts, the same shall be
in proportion that the distance travelled liz this
l.,l. n
That is to say, that every sleeping car hauled
across Indiana must ray to this state taxes
on its gross earnings III proportion that the
distance travelled in this state bears 10 the
whole distance paid for by the passenger. and
such companies shall pay tax thereon to this
state in the sum of 81 on every 500 of gross
receipts.
Express and telegraph companies must
comply with this law forfeit 500 for each
day in default after June /, and forfeit their
right 10 carry on business in this state until
they do comply with the law.
Telephone companies shall, on failure to
comply, forfeit $40 per day, and sleeping car
| companies $25 per day, and as a further pen-
atty, may forfeit the right to do business in
this state. The penalties are severe and
memorable.
Under the provisions of the law of 1889 the
state was limited to tax on the gross earn
ings on local business done by these corpora
tons in Indiana. In the language of those
|
business Originatfng and termindtinJ in the
state. The new law changes this and extends
the taxing power to the earnings of any BUSH
ness which in whole or in part receives the
protection of our laws.
The earnings OF telegraph, express, tele-
phone and sleeping car companies derived
from business ORIGINATING and terminating in
this state are OF trivial consequence and herein
Yves the weakness OF the old law. The new law
brings to the people the remedy needed.
law ha thae tota
will get a revenue. The old law was never en-
AS proof of this. all the money ever derived
from express, telegraph, telephone and sleep
ing cars, under former laws amounts to S6,-
$3.50. And this amount was paid on settle
ment made by Governor Hoyey and Attorney
General Michener under the per cent. act of
1880. and the settlement was on the basis of
| Indiana business, and not for one but for many
years back.
The several acts of 1889 over the repeal OF
| which the Journal feels so aggrleved, were, in
the opinion of Governor Hovey and Attorney
! General Kitchener, wholly unconstitutional
and were so treated. Both OF these officials
were and are republicans, and In addition TO
being attorncy-general, Mr.. Miohener was lat
the time of this settlement the chairman OF the
republican state committee.
The utter falsity OF the JottrndPS position is
shown by reference 20 Mr.. Michener's report
for the year 1880 on the subject of taxing these
same corporations under what he terms the I'M
constitutional laws OF 1889, and upon this point
recommends the passage OF the one now in