Watertown republican. [volume] (Watertown, Wis.) 1860-1906, 1899-03-29
THE BEST SYSTEM.
Views of Notable Commission
on Methods of Taxing
Railroads.

" lScoHslN Is nOC the only part OF the
country where taxation of railroad prop
erty has been a subject of careful and
extensive study. Some years ago con-
Ventlon of state railroad commissioners
was held in Columbus, O., at which a
special committee was appointed to make
thorough investigation Of the subject,
both IN this and other countries The
committee was composed of men who
were then railroad commissioners of their
respective states, and the names of at
least two of the three will be recognized
as of national prominence. The commit
tee was j. III. Oberly of Illinois, once
commissioner of Indian affairs; Charles
and w. B. Williams of Michigan. An
exhaustive report of their labors was pub
lished in the Railroad Gazette The
committee reported that information
sought was received covering the vari-
GUS states of the Union, Canada, Eng
land, France, Belgium, Holland, Ger
many, Russia, Switzerland and Austro-
Hungary
The committee found that ''there is no
method Of taxation possible to be devised
which is not applied to railroad property
IN some parts Of this country And
that so far as those now well-recognized
principles which should be at the basis of
all systems of taxation are concerned,
they would, as rule, seem to have been
utterly ignored" Again, "a more strik-
ing, and in some respects discouraging,
example of general confusion, as regards
an important matter of fiscal legislation
could hardly be imagined
Requisites of Correct System.
According to the report a few COM
mendable instances were found while in
many states the system was biased on
nothing more reliable than arbitrary
guesswork." Among the committees
conclusions was this.
The requisites to q correct system of
railroad, as of other taxation, are that
It should, insofar as possible, be simple,
hXed, prOpOrtiOnate, easily ascertainab BILE
and susceptible of ready levy" But
very few of the systems in use in this
country were found to possess any of
these requisites"
A conclusion of the committee was
that all the requisites of sound sys-
tenn were found in taxes on real proper
ty and on gross receipts, and in no 9TH
ers. Under this system the committee
says, Nothing would escape untaxed;"
and the system is perfectly simple; that
under it taxation is fixed by a general
law" and lis thoroughly proportionate,"
that lit can be ascertained by anyone,
and can by no possibility be evaded''
Reviewing at some length the general
assessment plan as practiced by local
assessors the committee found that
taxes thus assessed bore little or no
| necessary relation to actual earning ca
pacity, whether net or gross" and that
assessed valuations Of the same road in
the state of New York in adjoining as
Sessment districts varied from $500 per
mile to 500 per rod and the commit
tee was of the opinion that such a sys-
tenn ''compels the corporations. in self
defense, to an active participation in To-
cal politics. Indeed, it is not too much
to say that, as system, it is open to
almost every conceivable objection
Commends Wisconsin System.
Throughout it's report the committee ia
vored the system of a tax earnings which
1t characterized las equitable a method of
raising money by taxation as can be de-
ViSed,' and said as ''all communities and
every part of each community are depend
ent more or less directly on railroad trans
portatlon,' a tax thus imposed would be
1elt not unequally by ALL and if the pro-
| ceedS were properly distributed would not
| be unjustly shared by all.
The committee laid special stress upon
the conclusion that it found the Wisconsin
system most cOmmendable among those in
use in the states and said it seemed to them
most intelligent and in conformity with
correct principles and especially commend
able" In fact the Wisconsin system i'm
pressed the committee favorably that
draft of law which it suggested for adop-
ton by all Of the states was almost identical
with the provisions of the Wisconsin law
taxing railroads.
Apparent Discrimination.
Aside from tax on earnings this noted
| committee also commended the Wisconsin
plan of assessing property of railroad COM
panies not used in operating the roads. 1t
is under this feature of the system that the
Chicago, Milwaukee & ST. Paul company
has paid nearly S164,00 in the last nine
years to the city of Milwaukee in taxes
upon it's grain elevators and other non-ex-
elusive railroad property, it's average an
nual payment in local taxes of this class in
the city the last nine years being $1S 1877 81
This sum paid by this corporation annual
~ in local taxes upon its grain elevators,
etc, is in marked contrast with what the
city seems to have received it's
share of the taxes paid by insurance
porations:: The 1eo- Milwaukee controllers
sued by that official, shows the valuation
placed by Tax Commissioner Brown. for
taxation purposes, upon the properties Of
| railway and lighting and trust companies,
in the city Of Milwaukee, to aggregate S22,-
| Gil ,22O, while the city's portion Of all taxes
paid upon this entire volume of property for
| 1897 was but $10,975.1 u, little over half the
| average annual payment in taxes by one
railroad company on a few hundred thou
| sand dollars worth Of elevator properties
Interesting Comparisons.
| The comptroller's report further shows
| that the entire license fees paid TO the state
| by all Of these insurance and other Mil
waukee companies, in lieu of taxes on the
| 500, Gil, 200 worth of property was only
| Sill, S24.sO. An indication that the tax
| commissioner did not over-estimate the
| value of these properties is seen in the fact
| that his valuation placed upon the property
of the Milwaukee Electric Railway and
Light company was but 81, $50 900, while it
is claimed to be worth some 100000. This
seems to indicate the assessed valuation
| by the tax commissioner at not above so
! per cent. of it's value, at most, and prob
ably nearer 40 per cent.
Estimating all steam railroads in this
state by the value Of the very best of
| them, so per cent of their value would be
about sos, 100000, or less than five times
the value placed for purposes Of taxation
| upon the Milwaukee properties under con-
sideration,. yet the license fees paid by the
railroads in 1898 was 81, 247, 357.O3. 1t is
thus seen that under the existing system,
| and on basis of valuation manifestly I'M
| favorable to the railroad companies they
are paying more than twice the percentage
| of the value of their property in taxes that
other great quasi-publc corporations pay.
| If the railroad companies are not sufficient
| ly taxed what must be said Of insurance
| and other large corporations?
Assessments Very Faulty.
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