The Cecil Whig. [volume] (Elkton, Md.) 1841-current, 1893-10-21

i | Just as good reason to exempt the implement
OF the farmer: During the century OF our histor
large amount OF the Incorporated property Q
hospitals, schools, colleges and universities, upo
the theory, l presume, that these chartabl
, | institutions exist Tor the public good, and yield
I large return 10 the tax payer has been exempted
Under the existing constitutional provisions
the Il. n o r. X. Go. and the Northern Contra
Co. have secured partial exemption from taxa
! ton which are in terms perpetual, and hav,
apparently been put beyond the power of tn,
Legislature or of the people to repeal. II there
were any doubt upon this question, it seems t,
have been removed by the contract made between
these companies and the State in 1878. They are
clearly exemptions which should never have beer
| made perpetual, and which have done more than
anything else TO prejudice our people against al
exemptions Of property from taxation. The
| exemption of mortgages and bulls of sale from
tax of any kind was secured By Chapter 394 of the
Acts OF 1870. AT nearly every session of the
Legislature since then the proposition to tax
mortgages has been defeated, and in both OF the
assessment bills OF 1890 and the Hayes Bill OF
1892, the exemption is recognized. The Hayes
Bill did not, however, exempt bonds secured by
| mortgages on real estate, which should be
| exempted for the same reason that mortgages are
| Inc SACuplOu Oh mortgages NdS
recommended by the Tax Commission OF 1sSs
and as lar as am advised the representatives, Of
this county in both Houses OF the Legislature
| have uniformity supported this exemption.
| 1t is matter Of surprise to learn that a some
members of this Farmers Club" are IN favor OF tax
alton OF Mortgages. The tax upon mortgages Is a
| clear case of double taxation, if the land mort
| gagged is taxed also.
| a IA hn {rnm
b, 5000 on mortgage. The value OF the mort
| gage is in the farm. If A, is assessed for the
| full value of the farm, and b, the value OF the
mortgage in 'ition, the property is subjected
:. double tax.
| G, owns a lot in Port Deposit worth 81 Uu0 he
| borrOws 81 coo from D, on mortgage, with which
he Duilds 4 house. The house as som as erected
| is assessed. II the tax is collected both on tn
mortgage and on the house, is it not a clear case
ofdouble taxation? The reply is. that it may be
double taxation of property, but not OF persons.
| because the law should require b. and d, the
mortgages, to pay the taxes oni their respective
mortgages. But experience has demonstrated
that the tax is always shifted en- the mortgagor
who pays the taxes on the land and on the mort
gage. SO that in another sense the tax is
double one. Laws requiring the mortgage to
pay the tax never have been and never can be
enforced. II as is proposed by some the taxable
value OF the mortgage be credited upon the ass
essment oithe land, it would he of no benefit to
the mortgaSor, because he would still he com
PEELED To pay the tax on the mortgage. How
would the State be benef tied By an increase of
its revenues. On the contrary the State would
suffer by reason Of the increased difficulty and
confusion in collecting the tax. Any prOpoS'-
ton to tax mortgages, overlookS the incidence Of
the tax, that is who ultimately pays the tax.
The relative positions OF the lender aud borrow er
are such that the later must submit TO the terms
OF the former. There is no reason to expect that
the mCr.agee will submit 10 a reduction by law
of his rate oil interest from third to sixth
according 20 the tax rate Of the county where the
land is situated. he prevailing rate OF intere,
of county mortgages is six per cent. II the II ort
cages were taxed and the mortgage could be
compelled to pay the tax the rate of interest
received by mortgages. would fall 10 per cent.
My practical experience leads me to believe that
investors will not consent to lend upon country
property at such rate OF interest. Other and
more attractive investments pay As much. am
at loss to see how the farmers OF Oe;il will be
benefited by a tax on mortgages. Thee is over
a million OF dollars invested in m)rtgn. es in
Cecil county, most Of them on farms. Nearly all
of these mortgages contain covenants on the |
part of the .nortgazor to pay any tax that may
be levied on the mortgage. II a tax should be
imposed on mortgages it would only aid another |
burden on the mortgagors. If by any legislation
you compel the mortgages to pay, he would
simply demand his money on his mortgage at
maturity instead of renewing the mortgage.
If you want to ruin a iai- per centage of the
farmers of Cecil coun.y, by forcing their property
under the hammer of the auctioneer, at a time
wnen it will bring less than the mortgage debt |
and costs. by all means tax mortgages, |
and seek by2dtast:c legislation to compel the
mortgages TO pay the tax out of the interest
received by them.
Ever since mortgages were exempted, capital
has flowed freely into counties. and the
whole State has felt the benefit OF the exemption.
This is also true OF baltimore City. Could
money be borrowed uJ'On mortgage in Baltimore
City for five per cent, if mortgages had to pay
State and City taxes upon their investment:
DR.. Ely late of the Johns HopkinsUniversitI, a
member OF the Maryland Tax Commission oflSs4,
says in his supplemental report: page l74)
The diffusion of the benefits of exemption from
taxation can perhaps best be seen by concrete
ILLUSTRATION. Anyone who in Baltimore, walks
from Baltimore street in a nOrthcrly direction
city into the country, will notice large number
OF houses newly constructed or in process of con
struction and which oifa. ed for sale or rent
at far lower prices than such comfortable houses
can be obtained Tor IA any Cthe: gfeat city in
the American Union. Il is not too much 10 say
that Il house in this section of the city can be cb-
tanned tor S2j m0uta-a pleasant well situated
house-which could not be obtained in any other
city OF the siz3 OF Baltimore in the United States
for less than $50 "A mouth. low why is it nat so
much building is going Oh and that houses are SO
cheap? II any one thinks tnat the exemption Of
mortgages from taxation is not connected with it,
a conversation with practical builder or banker
will probably disabuse him OF this idea As n |
matter OF fact, savings banks would not and
could not put their money into such improvements
in Maryland If they were taxed. This is what
they do now, but il MOI. cages were taxed, money
now spent in Mar land would go to the West,
just as thirty millions of dollars have recently
left the State of New Hampshire. Who then gets
the benefit OF this exemption? They are dihuSed
widely through the community. rhe working
man does, for he has more abuudantopportunties
for labor and the taxation of mo- cages would
be blow which he would feel. In addition to
this, to tax mortgages, would tend to raiec Lis
rent The real estate man deserves a benefit, as
he does from every improvement, Tor it raises the
value of his land. The farmer is also benefited
in better home market Tor his produce. The
merchant is benefited ia larger sales. 1t the
money lender is benefited at all, his advantage
is not greater than that OF other members OF the
community.
To the testimony Of Dr.. Ely, can add that in
the town OF Elkton more homes have been built by
working men during the past ten years, than in
the previous fifty years, One OF the causes OF
this has been the ability OF our people TO borrow
freely from our excellent Building Association
and from private persons money on mortgage at
six per cent with which to build their houses.
To make the borrowing Of money on mortgage
more difficult will not be of any more advantage
to the thrifty working than 1t would be to
the farmer.
There is a most urgent need for general
assessment OF property in this State. have been
SO much impressed with this necessity, that 1
have twice voted in the Senate Tor assessment
| bills which contained unwise provisions. But in
locking for new sources OF revenue, the legisla-
ture Will not help depressed agricultural inter
ests By imposing tax on mortgages.
The assessment of Cecil county for So is as FOL
lows Lands $l2 lOi, 67s Stock in Trade, S377 ,lso
Stock particularly specified, 1882; Private
securities, Stof'i0v' law S''eN' ~0''''N' ''-
| Implements S2TiO54: Household furniture,
S443. 55s; Plate, So 696; Money deposit bearing
| interest and proI crty of other descriptions,
Ss4 265 Shares of stock $50 $50; total, SIS
Total real ST. lO4 675: Total personal S29lS .O94.
| There are or two significant facts to
| which your attention should be directed in this
| assessment The largest item OF personal prop
erty assessed in county is shares of stock in
| domestic corporations. The amount is Ss529o9.
and Tar exceeds the assessed value OF live stock
and the combined assessments of farming imple-
| Inents md household furniture.