Hot Springs weekly star. (Hot Springs, S.D.) 1892-1917, 1893-02-24
FOR REVENUE.
Taxes Not to BE Reduced
Because Of Any Mortgage
Incumbrancc.
-Au Exhaustive Report of Great
And Especial Interest at
This Time.

report on the subject OF deducting
mortgages from the assessed valu-
alton of incumbercd property, which,
claims the Sioux Falls Press, will
become a classic. 1t is the most
complete argument against the
proposition that has ever been seen
by the Press correspondent, who has
paid considerable attention to the
question officially, professionally and
personally. 1t is as follows:
The proposition embraced in said
bill to deduct the actual value of all
mortgages from the actual value of
all property incumbcred Herewith.
for the purposes of assessment and
taxation. is one that has been pre-.
scnted for the consideration OF this
and former legislatures so frequently
and in SO many varying forms, that
your committee deem it proper to
state somewhat at length the
grounds on which are based the
recommendations herewith sub
mitted.
Section , of article III of the con-
stitution requires that "all taxes to
be raised in this state shall be
uniform on all real and personal
property. according to its value i'm
money. to lie ascertaincd by such
rules of aplraisement and assessment
as may he prescribed by the lcgis-
laturc by general law. so that every
person and corporation shall pay Il
tax i'm proportion To his. her or its
property"
The legislature of 1881 provided i'm
session IS of chapter a. session laws
at 1891. That amy person WHO is
required to list credits either tol
himself or any other person. firm or
corporation. may deduct from the
gross amount thereof all bonaiidc
Indebtedness of himself or OF any
person, firm or corporation. And in
subdivision , of said section it is
further provided that any person,
firm or corporation in making up the
amount of personal property required
L" he listed for himself, company or
corporation. he allowed To deduct
from the gross amount thereof amy
Indebtedness of himself. company or
corporation. If the same be held or
owned within the state
Our supreme court i'm an opinion
rendered i'm response To a question
put by the governor. decided that
this provision of the statute is
clearly in conflict with the above
provision ot the constitution. in that
it prescribcS a rule for assessment
which is not uniform On all property
according to its value in money. but
on the contrary requires the class of
property designated as credits and
the personal property uf debtors to
lie assessed at a less rate than other
classes of personal property. or the
personal property uf those who are
not in debt. and at i, less rate than
real property.
The provision conta ned in this bill
must lac subject 10 the same cunstitu-
tl"nal objection. and in a still greater
degree. for il proposes not to deduct
generally Il PERSONS Indebtedness
from the amount Of his assessment.
and thus make each one taxable on
The net amount ~ property he is
actually possessed Of. hut il singles
out. not one particular form of
Indebtedness merely. but rather one
particular form Of collateral security
for Indebtedness. and proposes to
exempt from taxation an amount of
property equal t. the amount of
such collateral security.
This is certainly not that uniform
taxation of all real and persona.
property required by the constitu-
tion.
l:ut aside from any question of con-
stitntionality. ii is the opinion q.
your committee that such Il law
would he very unjust in its practical
workings:
We will suppose y. Il and c are
ncghbors. owning real and personal
property of the same kind. amolln,
and Value. A borrows certain sum
of money equal iu half the value of
this property. for which he gives his
pomissory note and iu secure pay
ment of the same executed n
mortgage upon his property. II
borrows the same amount. for which
he gives his promiSsory note. to
secure payment of which he proc,lres
the Endorsement of Il responsible
friend. G borrows the same amount.
and being Il man of good credit. he
gives his promissory note without
other security. Now these three men
own property of exactly the same
kind and value. each as the other.
they are each indebted i'm exactly the
same amount and for the same con-
sidcration as the other, and each has
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