St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1893-09-15
TAX ON BANK PROFITS.
STATE BOARD or EQUALIZATION
W0aKLVe ON A K00TTY PROBLEM. s
a LAME Lazy KEsPoSsssLE.

Refusal of Banks to Make Re-
tnrns of Undivided Profits
Not Troubling the Board IA
Line of Procedure. Agreed
Upon That Is Considered Fair
to All Parties.
The state board of equalization yes
terday afternoon settled upon its policy
with reference to the assessment Of
banks. adopting liberal one. The sub
Ject was opened on the appearance of o.
l.. Cutter. of the State Bank of Anoka;
l.. j. Greenwald, Anoka National bank;
Z. w. Hastings, Lumbermen's Bank of
Grand Rapids. ana James Shoemaker.
assessor of Mankato. The bankers
stated that they had been assessed 100
per cent, and Mr.. Shoemaker stated that
he had assessed the bankers of his city
100 per cent, while the banks of other
localities were assessed but 90 per cent.
The board promised to eqaaliZe the
matter.
After long discussion the board de-
cided to adopt the plan embodied lD a
law provides that the banks shall make
return of their capital and reserve
funds, but is silent upon the matter of
the undivided profits. The board of last
year decided that the banks should
make return OF their undivided profits.
so that the board might have additional
data upon which to estimate the value
OF the bank stock in each case. 1t ac-
cordlngly passed resolution instruct
ing the state auditor to notify the county
auditors and the town and city assessors
THAT hereafter it will be the practice of
this board to use as q basis in eQualiZing
the assessments on banks III this state.
their capital stock, surplus. and all
undivided profits, except an amount of
their undivided profits equal to 10 per
cent of their capital stock, (the latter
to be considered sinking or guaranty
fund.-, deducting from the sum of the
three items the actual value OF all real
estate owned by the banks"
REFUSED TO MAKE RETURN.
The county auditors and assessors
acted i'll accordance with the notiliea-
ton. but the banks refused to make a
return of their undivided profits, upon
OhC RlOuuu tlldL LHey were llOC required
by the law to do SO. However, the
board yesterday was in possession OF
the amount of undivided profits held by
each bank III the state. and will proceed
III each case to deduct the sum of 10 per
cent OF the capital stock from the undi-
ylded profits and use the remainder as a
basis of estimating the value of the cap
ital stock, then make d reasonable re-
duction in the assessors per cent OF
valuation. This will result i'll lowering
the assessment of great many banks
throughout the state, and iu raising the
assessment OF others.
In the discussion of the matter il was
stated by various members OF the board
that. state banks not being required to
have reserve funds, as national banks
are, they were very much inclined 10
lay aside what is really reserve fund.
but called by them undivided profits, in
order to escape taxation upon it. }his
undivided prUrit adds to the value of the
capital stock, hence it should be used
as basis in estimating the value Of the
capital stock.
A resolution was adopted authorizing
the policy outlined. Then the board
settled down to the routine work of
eQuaIizing the bank assessments. and
will probably not finish it inside of
three or four days.