The Corvallis gazette. [volume] (Corvallis, Or.) 1862-1899, 1894-11-16
THE TAX LAW AGITATION.
Mr.. Davenport Believes That
No Benefits VIII Accrue by
Tinkering With Assess
ment Laws:

y
! just Assessment Law" in which the writer
argues rorclbly against the ''present abom-
| Unable assessment law" and offers q sugges-
ton as to practicable method of procur-
| ing the assessment and taxation of credits,
| i. O., notes of hand and book accounts OF
course, such a suggestion ia always accom-
panied with the equitable proposition that
the debtor shall have the opportunity to de.
! duct from his assessment The amount of his
debt. This Recommendation is precisely
| last session of the legislature, except that
| the writer proposes to empower the debtor
to pay tax upon his debt and collect it from
his creditor
| Likely such a method would secure a
| more general listing of credits than the old
law, but the main purpose, that of making
the creditor pay tax upon his loans, would
| fail al if ever has done.
| Why not set it down as fact, drawn
| from human experience, that when credits
are taxed, the debtors pay the tax. Moth
| ing is more certain as rule.
Everywhere over the country, the stipu-
| lation in mortgages is that the borrower
shall pay all taxes assessed on the note or
| mortgage, or also the same purpose is ef.
fected by means of bonus.
Until lately ten per cent. per annum
| would include the market interest rate and
two per cent. taxation Foreign loan COM
panies doing business in this state loaned
money at or s per cent. and stipulated for
the payment of the tax by the borrower.
Since the panic commenced, very little has
been loaned at any price,.
Domestic lenders have done some business
| on short time and at heavy bonus rates paid
| the brokers.
Since the present law came into opera
tion, merchants have adopted the plan of
charging per cent. on book accounts, in
order TO effect the tax on them, aud debtors
! will find no avoidance.
Shifting of taxes is no new thing under
the sun; on the contrary, it is old, and all
creditors understand the means by which it
is accom- mplished. Every taz put upon money
or, what is the same thing, credits, is
passed over to the borrower. Such has
changes, such it will be. Every effort 30
made by legislative bodies to get at the
money bags of Dives has fallen disastrously
upon the resources of Lazarus. In view of
this, an earnest and able member of the
legislature from Marion. county, once said,
eff Dives has not paid he should pay; let
US keep at it; we will get him after
awhile"
At present, he has gone rather extremely
the other way and says, 81 have found by
experience that nobody but honest fools pay
tax" "
We may set it down as fact in human
| nature that every tax capable Of being
| shifted will be shifted onto the consumer or
user of the commodity taxed.
When the city authorities put tax upon
| beef peddlers, the price of beef is raised to
the citizens, and nobody wonders or com
plains of the peddlers But the city dads
| catch it.
When lucifer matches were taxed 20 cents
bunch, matches sold for 25 cents bunch
and nobody marveled. When the tax was
taken off, matches sold for 5 cents.
If this law had not held, matches could
! not have been furnished for the comfort and
convenience of the people.
The writer in the GAZETTE need not fancy
that because he has gots a law compelling
! the creditor to give his debtor credit on q
note or book account, that thereafter cred
| itors will pay the tax. The same means of
avoidance by him will be used which all
! creditors have used for centuries.
1t will become q matter of bargain and
agreement between debtor and creditor
| when the loan is made and no one can help
it or hinder it. Lawmakers are pow erloss
in the premises.
The only way in which debtors can be
| released from paying tax ON what they owe
is either to have no tangible property or to
be allowed to deduct their indebtsdn sss
scheme would result in freeing a large part
of both real and personal property in the
state from taxation,
Not only SO, but honest debtors would
he obliged thereby to bear much heavier
burden than when they pay taxes upon their
debts. You will recollect that under the
old law when credits were taxed and de.
duction of indebtedness allowed, the debts
in the state exceeded the credits by about
40 millions, all of which was taken out of
the assessed value of tangible property and
diminished by that much, the amount sub.
ject to taxation within 1.-THE state. 1t was
a crying abuse and getting worse and worse
every year. To stop it, the last legitlature
repealed the law allowing deductions for in.
debtedness. At first sight, this seems hard
upon the debtor class, but presume as a
rule that honest debtors have been bene-
fted by the change.
On account of the repeal of the mortgage
tax law there is practical discrimination
against the borrowers of domestic or home
capital for the reason that home credits are
taxed while foreign credits are not. This
inequality should be removed by abandon
ing all efforts to tax credits, and this places
debtors in just as good and equitable condi- |
tion it is possible by law to place them. |
Let us see, to make this last point clear.
When credits are not taxed, the debtor |
pays tax upon all the tangible property in
his name. When credits are taxed and |
j i. L IL