The Manning times. [volume] (Manning, Clarendon County, S.C.) 1884-current, 1891-02-25
TAXING BANK STOCK.
SHAllTNE S-A!G SAil!IE = SHT11N
OUT OF EXISTENCE?

The Construction of the Wv ,0N",'::.r'e.
the Mastcr--N &j,tei"~.rs ..o..s -"
Comptroller Generals Office Regarding
the Connor Letter.
COLUMBIA, S. c., Fchruacv l.
Some interest his been created il
banking circles inregard to The ccnstruc-
ton of the law governing the taxing c:
bank stock and the manner ot returns
to be made by banks. Somc days ago
Mr.. ". NJ. Conner. President Of the
American Savings Bank OF Charleston,
wrote to the Comptroller General I; les-
ter OF inquiry in regard 10 this matter,
and was replied to by Chief Clerk Nor
ton under the instruction OF the Comp
troller General.
The Sunday News OF the 18th inst.
publishes an interview with Mr. Connor,
in which he makes the following state
ments concerning his letter and the re-
ply received by HIM from the Comptrol-
Ter Generals Office:
''My letter has not been answered. l
wrote upon an entirely different matter.
BY way of Illustration let me show you
about what wanted to find out. Sup
pose on the 3lst of December any bank
shows thatit has made $4,000. On the
lst of January the bank pays $500 II
dividends to is stockholders and its ex-
penses have been $4,000 for interest and
running expenses. [ wanted 70 know
whether taxes are to be paid by the bank
on the $4,000 or on the net surplus and
undivided profits Of the bank on the lst
Of January. I have not been answered
on that question.
''In one paragraph OF the letter Mr..
Norton says: Suppose the shares CT
your bank to he worth on the markets IN
Charleston 500 per share, the par value
being 800, your return then would be
$50 shares at 5000, or 100000 and
then hes says: ''It is the duty OF the Au-
ditors to ascertain the real money value
of all bank stock and where not correct
" returned on the tax books at the real
market value
What is to be understood from such
statements In one place he wants the
real value of stock taken as basis for
returns, and then he says returns are to
be made on the basis Of the market val
ue of stock. Two quite different things.
Some time ago our stock was selling at
Sl65. Mr.. Marshall called On me, and
I told him that the books would not
show the stock to be worth over $l43.
Does he want to tax US on the $50,
which is merely fictitious value:'
'sIt shows confidence IN bank, and
is this confidence to be taxed? Yet. MIR.
Norton says the returns should be made
for what the shares are worth on the
markets. A bank cannot be responsible
for the market value Of its stock.
81 have no intention of answering the
letter, as I have received DO answer to
mine. The stock Of an old bank, when
It's stock runs up to $500 or .$4Q0. IS dlt-
fcult to sell for more than its true value.
because ranks seldom pay over 10 o- II
per cent. interest, which means Only 3
or 4 Der cent. 70 those who buy the stock
at $500 or 500 when the par value OF
the stock is only $I00."
Yesterday The Register reporter in
terviewed Mr.. Norton on the subject OF
Mr. Connor's statements, and Mr.. Nor
ton said, that the letter referred TO by
Mr.. Connor was to all intents and pur-
poses the Comptroller Generals letter,
as he simply acted in his clerical capaci-
tv, signing it "W. II. Ellerbe, Comptrol-
Ter General, per Norton" He then
added: "As Mr.. Conner says the
Comptroller General did not answer his
letter, We give them 10 the public F."
CHARLESTON, S. c., Feb. y, 1891.
Hon. ". II. Elzer6e, Comp. Gen.
DEAR SIR: Wishing to comply with
the requirements OF the law. write you
for information. AS I understand, we,
the banks, are to return and pay taxes
on the capital stock and on the net sur
plus we have left on January lst, after
we have paid the interest due to the
depositors to that date and expenses of
business deducted from what we have
made; then the net surplus and capital
stock. This is the way construe. Am
I not correct? Please write me at once.
See on back OF bank statement enclose.
Yours truly. W. NJ. CoSNoE.
Surplus and undivided profits So, las "a
Expenses and interest paid
depoSltors. s................ 1870 20
5 $3.50 4S
January dividend, paid stock -
Surplus, 1st January, 1891. $3.50 IS
The above is true.
T. N. McTUREouS, Cashier.
THE Comptroller General took it
that Mr.. Connor sought information and
took pains il replying to him. The
Comptroller had the construction Of the
law by the Attorney General. andsimply
gave, as he thought under the law, the
information desired. That is, that the
bank must return TO the Auditor all the
shares of SAID bank, with. the names OF
the owners CT such shares, assessed at
their true value in money II Mr..
Conner I'd taken pains to read Sections
1913, 1879, 200, POI, 202, 203, 204 and 205
of the General Statutes. he never would
have SAID that the Comptroller General
had not answered his letter.
1.-The law is plain that the banks Of
this State pay taxes on only their shares
assessed at their true money value.
Their furniture, real estate aud surplus
are not taxable-the real estate being
deducted from the amount OF shares at
their true money value while all sur
plus or extra moneys, capital and every
species Of personal property 0! value
owned or in the possession OF any such
hool- ora ipcI,16a6 in onG holm to make