The record-union., 1892-10-06
3nnat Bnsf4te 3]ntunsr.
40 per cent.-say $500, ,742-making a

40 per cent.-say S3,863, making a
total of Sl0,0 ,226.
opon inns large sum the taxpayers pay
interest - per cent. per annum-say
SIoV;uoO-nlgher than the rate that would
pe demanded by bond buyers except for
the Iact that county, city and municipal
pohdS are taxable under this law, and, as
already mentioned, not one-tenth OF the
amount IS returned to the public in form
OF taxes paid on bonds.
ine escape from taxation is due to the
tact that the bonds are held by non-resi-
dents and by local parties with elastic
cohsclences, who contrive to shirk their
snare OF the burden OF supporting Gov
ernment.
Non taxable bonds are a fayorite in
vestment Witness the prices at which
| United States and other exempt bonds
| are sold; place tax on them and they
cease to be desirable, for there is no COM
petltlon Tor their purchase; they cease to
pe the next thing to caSh-cash items as
they are sometimes called. Not being
readily salable in the market, they do not
ind full place on the list of securities
that savings and provident institutions
may purchase or upon which they may
loan money.
competition for securities of any one
claSS Is uhe prominent factor in reducing
the rate OF interest thereon: the taxation
OF bonds diminishes the competition at
least one-haIf, the result being a positive
loss 10 the community for the benefit of
Dondholders nonresident or those within
the State skilled in the matter of eyadinp
taxes.
Bonds OF irrigation districts to the face
Value OF So, 100000, more or less, are seek
ing market in this State but thew can
not be placed, the chief objection being
that they will be taxable in the hands Of
purchasers
FOR the same reason bonds of various
school districts linger in the hands of
agents and brokers.
The wealth of the State would be in
creased by the watering of its arid lands,
and sound public policy REQUIRES that
1acllltleS Tor education be afforded all
the children in the commonwealth. but
important as these matters are, they must
give way to the paramount necessity that
no credits must be allowed to aScalo 70
alton.
1t is often said of laws enacted or in
contemplation, that their tendency or
erect is, or VIII be, to make the rich
rlcher and the poOrp poorer.
ms is emlnently true of the taxation
OF bonds OF irrigation and of school dis
trlctS remote from centers of population.
The tax is paid in the form of increased
interest by real estate owners who stag
ger under their burdens, and is realized.
IL at all, by afi1uent counties and munich
palitles where reside the wealthy who in
vest in the purchase of bonds.
For reasons herein given and others
that may be urged, the revenue laws of
the state should be amended in at least
two particulars.
Mortgages should be exempted from
taxation, except for State and county
purposes.
Government bonds, by which is meant
those on which interest is paid by tax
collected from the inhabitants of the state
or from those of any fractional part
thereof, should be absolutely free from
taxation.
Such amendments would benefit the
money lenders and investors only by eX-
tending the field for the satisfactory en-
ployment Of money.
The chief benefit would result to par
ties having occasion to borrow money on
city or town property, and to the inhabi-
tants of municipalities and school dis
trlcts where the public necessity compels
the nuisance of bonds.-San Francisco
Journal Of Comperce.