The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1898-03-01

OBSERVATION-DISCLOSURES
disposition OF legislators 10 grant such aid.
narity states have no income except
from taxes. What they give to one has 10
be first taken from others by taxation.
They have nothing OF their own 10 give.
In order TO indulge this free-handed re-
Spouse to growing demands, taxation must
be Increased. But increased taxation OF
the voter endangers The political aspira-
So 10 crafty their constituents who want
state aid for some project and at the same
time not to offend their constituents who
are voters. legislators are put under a
strong temptation TO tax somebody who
doesn't vote for the benefit OF those who
do Attention is at once directed TO cor
sonasftfes, wfIcs~ funds are IN plain sight
and easy TO reach. and against which II
is easy to excite such prejudice as to make
many people blind to all questions of jus
tice or propriety, and careless OF those
who really compose these corporations or
where their funds come from and what
they are held for. Not a session of leg
slature passes in any State, but more or
less measures for taxing or increasing the
taxes on life insurance companies are
brought forward. and almost always with
some degree of success
1t is high time that policyholders should
understand clearly and precisely how this
matter affects them personally; that What
ever their company is taxed is paid by
themselves; that the tax is really upon
them personally. and that the company
merely collects 1t from them and pays IT
over TO the state. For n mutual company
has no funds except those derived from the
premiums paid In by its policyholders. The
premium paid in by. member or policy
holder is calculated To fulfil two purposes:
First. 10 pay the death losses OF the year.
and also 10 provide a reserve against the
certain future greater losses as the MEM
bership gets older and second. TO pay run
ming expenses. These things cover the
normal cost of insurance. Whatever is
left Of the premium after providing these
things through the year is surplus. and Is
returned to the poliCyholder as an over
payment: or in ordinary, but incorrect
speech. as "a dividend" Whatever is paid
for taxes comes out OF that surplus and
makes the return OF surplus inst ." much
less and makes the cost OF his insurance
just 20 much more. Any tax on a life in
surance company, or on its premiums, Is
a direct tax on the individual policyhold-
er who pays the premium taxed He does
not see the tax. 1t is not intended that he
should. II is intended that he snail sup
pose that II is a tax on a corporation only
and not on him. But he pays II, and no
one else. and 1t IS the States addition to
the cost OF his famlys protection.
second matter for your most serious
consideration Is this:
Life Insurance Ought Not to he
Taxed at All.
Taxation ought to bear on the possession
and use OF property and not upon the loss
or property or upon the means by which
SGGH losses are distributed.
The only moral and humane theory Of
taxation IL the collection OF only such
moneys AZ are necessary for the rrorer
and legitimate expenditures OF the State,
from such sources. that is. from such per-
sons owning such properties, az ought 10
bear those expenditures and in the pro-
portion In which they ought to bear them.
Under such theory no one would sug-
gest tax upon peoples losses. These
could be regarded neither az the proper
subject matter of taxation, nor az a hu-
h~ ctss Hat 4t...s
dens
TO illustrate:
No one would suggest that because a
mans house. on which he has been paying
taxes has been burned he should AT once
pay a special tax on it's value which he
mas Just lost. Or that mans family
! should be taxed on the money value Of his
NE 10 them, because he has died and they
have lost that value.
teauranee is merely n method OF diStrIb-
utlng the property losses Of those who
have lost property among those who have
not lost II. 1t is effected through eontri-
buttons or payments. called premiums.
As house. worth 5000. and on which he
has paid taxes while u was I'm being. has
burned has lost 5000 There is ne
restoring II. That property and its value
are gone forever not only 10 A, bat to the
whole world. To tax on that loss would
be- an unspeakabls inhumanIty.
But has insured against that loss that
Ia. he has agreed with other house owners
30 share their like losses. II they VIII as
sumo his loss II II comes While hrs house
is unburnt. he by his premiums. assumes
hts share Of the losses Of those whose
houses burn meantime. When hls house
burns they. by Their premiums take his
loss on their shoulders and make IL good
TO him. They lose II instead II A. beeause
before that. ne had through his preDalssinx
been losing hts share OF their houses
which had burnt.
Their assumption Of the loss and giving
a the money rs place or bis house hasn't
restored the house. IL hasn't changed the
loss into gain or into an even thing. The
property Is gone The loes remains. II
aas merely been distributed. A is made
whole but The contributors 70 that result
have taken the loss 30 themselves ard are
lust 50 much worse off. They have lost
S esl lose among them.
To TAX A additionally on the g. 90 be-
cause 4 var returned % hirn would be In
human. II would be 10 make him lose
sameth hing in spite Of his own and others
ef1urss 20 avoid loss. IL would be loss
created and inflicted by government or the
occasion Of his escaping from "a greater
loss. IL would be a fine On him for not
losing
To tax che other men, who BY their pre-
u4}nms. have taken As loss up0n them
Selves. ia an equal InhuDanEy. They have
made as less their own 20 save him To
tax them or thesr loss IL an equal Outrage
30 taxing A upon that same loss II 4 had
remained en- him.
IL il taxing a loss and Il liz a rne. a pun.
shnegt upon men FOR 40 sharing each
others losses THAI II becomes posse Die for
shen 20 De borne. The group OF men
forming g mutumt Insurance cornDa nv can
together bear s0sFex whteR would ergsa
ard destroy tne individual But Is II as
5rH0Fu s~NVa tyranr0Gs 70 tax The losses
/ - the group 81 20 tax those Of the indl-
dual watch ks would have % bear but
for the artlgn u tne group
TIE only element III tn@ fraas2 csaors ffgas
agGesta taxation e thee losses eE1her
- SIZE Individual or 20 the gr1up ~ FraG.
t4aI company. II thse fact that Il requires
-ne Use ~ money a adjust them and that
iAe money - brought iaso sight IN The
hana 81 the adjusting association or cor
pcEasGons aid 70 easy reach Of tie Tax.