Evening journal., 1897-12-06
THAT ADAMS Tax BILL

CONFER WITH COUNSEL RE
GARDING ITS EFFECTS.
At meeting of the Clearing House
Association yesterday committee was
appointed to confer with counsel con-
cerning the effect of the Adams bin for
the taxing of investments upon the
banks. An impression has existed that
the bill did not apply to the national
and state banks, and so far none of
them has submitted its return to the
county assessors. Ii viii be recalled
that the law in question requires all
corporations to make return to the as
SCISSORS showing the capital stock, the
market value Of the shares, and the
number of shares held by each share
holder.
Under the act this return must be
made December ]. The assessors be-
gan their sittings at the Court House
on That day, and were there the rest of
the past week. In the four days they
received the returns Of a score or so of
corporations, including the two local
trust companies, but none from the ma
tional and state banks. The savings
banks are expressly exempted from the
provisions OF the act. And, as already
stated, il was thought that the other
bands were exempt But some ques-
tion has arisen, and, in order to be ON
the safe side, the banks Will receive the
advice OF counsel. The committee
named at yesterdays meeting of the
Clearing House Association comprises
Joseph l.. Carpenter, Jr, president Of
the Formers Bank: James p. Winches-
ter, president Of the First National
Bank, and George s. Capelle, presi-
dent OF the National Bank OF Will
mingtOn and BIandyWine. In the after
noon this committee met in consulta-
ito with Attorneys Lewis G. Vande-
grift and willard SALISBURY, and asked
their opinion concerning the effect of
the bill upon the banks. Part OF the
conference was held in Mr. Vande-
grift's office and part in Mr.. Sauls-
bury's office The attorney took the
question undcr consideration, but have
not as yet given their decision
The banks are already paying a tax
to the state under a law which imposes
tax of one-fourth of / per cent. ON
the par value Of their stock For q
great many years that law was not en-
forced because 1t was not regarded as
capable Of being enforced, but a suit
was brought in the United States Cir
hung along in The court for some years.
Benjamin Nieids represented the banks
in fighting the act and the case was
argued before Judge McISennan. 1t
was something like five years ago that
he handed down his decision in the
case declaring the law to be oonstitu-
tional
There was no appeal taken from this
decision, because the hanks entered
into an arrangement with the Begisla-
ture by which n compromise amount
was agreed upon as due the state under
the proceedings. and the banks paid
that. Since that time they have been
paying annually the rate required by
The act.
A question has always existed as to
whether Judge McI<ennans decision
was correct, and there have been deci-
sions involving the same question rem
dered elsewhere to the contrary There
is some question now in the minds oi
the banks of the city whether the plo-
vision at the end Of the Adams tax biz
10 the effect That all acts inconsistent
Win IL are repealed does not raise the
question as to which act they are tax
able under. Il is not a question as to
whether they will or will not pay a
tax, but the question is as to which law
they shall pay the tax under
If the old act should he held valid
then the banks are undoubtedly ex-
empt from taxation under the Adams
tax bill, because IL taxes only such
property as is not otherwise taxed fol
state or county purposes.
The main objection to the origina
bill taxing The banks was that it was
unequal taXationA with respect to ths
banks and a discrimination against
them. 1t was, therefore. held to be 4
violation Of the Constitution of The
United States, which guarantees equal
lty OF taxation. It was with regard tc
this bill that William c. Spruance
now associate justice Of the stat,
courts, gave mis- opinion at the tim,
that the banks were not liable to tina.
tax.
So far the Adams tax bill has hat
rather smooth sailing with respect tC
the filing of returns from corporations.
but tbs many slip 'twixt the cuI
ad the lip and tbs a long space be.
tween making the return and payins
the tax. The assessors put the propert,
on the list shortly but do not repor
TO the Levy Court tor several months
and il will be a ninth or two more be
fore the books go into the hands of tn,
tax electors. No collection can b,
made on the assessment now beinl
prepared until that time. II is alto
gether probable that when an effort il
made to collect taxes under the bill
that its validity will be tested in court