The sun. [volume] (New York [N.Y.]) 1833-1916, 1898-10-19
srRpLus or slr1Nes nAxKa
Decision That Such Sums, Amounting to
aIOO. 900 900 in This state. Are Not Tn1nhl..

Decision That Such Sums, Amounting 70
500, O0O, 900 in This state, Are Not Taxable.
ALBANY. Oct. 19.-The 500, 100000 rerre.
senting the surplus OF the savings banks VI the
State is exempt from taxation. according TO a
decision handed down to-day by the Court OF
Appeals. This means n saving to these banks
annually OF 81, 100000. The question arose on
the taxation OF the surplus Of the NewturR
Savings Bank by the local assessors OF that
city. The lower courts hold that the surplus
fund OF the bank was exempt from taxation,
and the Court Of Appeals to-day sustained
their decision. Judge Gray, who writes tina
opinion OF the court. In which all concur, saws
in part:
The important question which this apre.l
brings mp for consideration Is whether the sur.
plus fund held by a savings bank in this Stats
is liable to taxation or not. The question Is OF
very considerable Importance. inasmuch as the
aggregate OF the amounts OF surplus funds
held by tho savings banks OF this State Ia up.
ward Of 500, 100000. and their exemption
from taxation necessarily affects materially
the body Of taxpayers. | think the Banking
ownership Of all the, funds by the derositorS.
The assessment In this case necessarily pro.
belonged to. the bank itself. and that what waS
due to the depositors was only the aggregate
OF %6.s the 'um me cred credited dot to them r.o on their
~ Nv NN'A' 80 w III lm0
statute OF exemption means. by a Just interprs.
tation. the total amount received for which
the bank is accountable and not merely the
identical moneys received from particular de.
positors. The surplus which has accumulated
Is a part OF a fund which represents the oriGi.
contemplation that It may be needed to be used
to repay the depositors the amounts put In by
them. no.
appellants contention could be sustained thai
only the actual d~eposits, which are returnabIo
TO 0eDO91tOrB on demand, are eXnmDt from
taxation. The surplus does not belong to the
bank. for II holds IL for the security Of the de-
%positors, to whom IL Ia due continRently UNION
the occurrence OF circumstances requiring its
payment to them. 1t seems to be fair. II not q
plain inference from the course OF legislation,
thai while the legislature at one time author
lied the local taxing authorities to reach the
| surplus held by savings banks. and suhse.
quently withdrew that authorization. 1t must
be regarded as adopting a policy OF montana.
ton In the case. of savings institutions. The
purpose to allow local taxation for tho
benefit OF the community is to he deemed
abandoned. II Is to be presumed that consider.
ations OF public policy have dictated the ok.
emption and that the Legislative body has been
! ~actuated by the motive of assuring the protec.
ton OF deposltors against the contingencies Of
losses, or OF depreciation in values. The only
apparent reason for questioning the policy Of
| such exemption IS the magnitude Of the amount
must be left to the. consideration Of the Legis-
lature and which does not bear upon the con.
s~titution Of the law"
Another question affecting the savings bank
depositors will soon be passed upon by the
Court OF Appeals. 1t Is as to whether q deposi.
the existing tax law to pay a tax upon his de.
DOsit.