Watertown republican. [volume] (Watertown, Wis.) 1860-1906, 1899-01-18

Inelf snare OF the expenses OF C0e govern
| ment. Among these insurance COM
panieS, the Sleeping-car companies and ex-
press companies. Then there are the trust
companies and insurance companies of our
own state, which do not seem to be fairly
| taxed when compared with other large cor
poratiOns. Our present graded license sys-
tenn of taxing the railroad companies con
tains some glaring Inconsistencies We have
| under this system five classes of roads the
classification being based upon the earnings
per mile. The first class pays per cent.
! upon its gross earnings; the second class
is taxed 312 per cent. on its gross earnings;
the third class 8 per cent. on its gross
earnings; the fourth class pays So per mile
per mile up to $4,000 per mile. The fifth
class pays So per mile only.
The report of the railroad commissioner
Of the state, which Will be laid before you,
! contains some figures showing the inequali-
ties of this classification. For instance the
class of roads which pay per cent. of
their gross earnings pay the equivalent of
Il rate of 4o-1OOthS Of 1 per cent. upon the
cost of the roads The third class, which
pays per cent. of their gross earnings,
pays but 2S-1OOths of L per cent. upon
the cost The fourth class pays but 1-3-
1oOths of l per cent. upon the cost; while
the fifth class pays but S-1O1OOths of 1
per cent. upon the cost.
The commissioners report further shows
! that some of the roads which pay the tri-
fling sum of So per mile in taxes, and from
which the aggregate sums received varies
! from $50 upward, show in their own re-
ports large earnings, and, in some cases,
| that the management of the roads have
/ been able to pay large dividends.
In view Of these very noticeable incon-
! sistencies, recommend that the classified
| ton be abolished entirely, and that uni
| form license fee upon their gross earnings
! be charged all roads doing business within
! the state, regardless of what their mile
| age or earnings may be. If the per cent.
| fee upon the gross earnings, which the
| nrSt-claSS roads now pay, were charged all
| of the roads, the income of the state, based
| upon the returns for the past year, would
! be largely increased.
! 1t rests with YOU to determine, in pro-
| V1dlng for raising the additional revenue
| necessary to cover any appropriations
which you may make, whether the tax
! only, or shall be divided between the
! sessable property and those corporations
! which are taxed under the license system
! The facts we have to face is that each
! year the expense of carrying the state
! government increases. This is true, l be-
! lieve. in every state. Not only is there an
! increase in the aggregate cost, but there
IS an increase in the per capita cost. In
| other words, the increase in the cost of
! carrying on the state government shows
higher ratio than the increase in our popu-
| latiOn. 1t is your duty to say whether, in
| meeting these increased expenditures each
| year, any class of taxable property shall
be exempt from paying its share of that
| increase.
1t will not be possible I think, for the
! Legislature to take up the question of tax
! alton so thoroughly as to ascertain definite
! ly Just what increase there should be, il
any, in the license fees charged to certain
corporations now paying taxes under that
| system. But, if you deem it wise TO con
tinue or provide for the continuance of the
work of the tax commission, we may hope
| that by the time another two years have
passed it will be possible to present to
| the Legislature such recommendations.
based upon the most careful research. as
will simplify and make more just the whole
| system of taxation in our state.
have already referred to the fact that
the sleepinS-car, express, insurance and
trust companies are not now sufficiently
taxed, and on further investigation, 1t may
be found that there are others which should
be placed in this list. The trust companies
are somewhat of an experiment in Wiscon-
Sin, and l realize that it will be difficult
to reach a fair basis upon which to tax
them. But, until such a basis has been
reached | recommend that these companies
be taxed as other companies are. upon the
property they own. Certainly there can be
no injustice in this: for there is no reason
why the property of a trust company,
where it is accessible, should be exempt
from taxation, more than the property OF
q lumber company or any similar corpora
ton.
The present system of taxing insurance
companies is in many ways unsatisfactory.
The inequality of the present method can
be understood when it is stated that the
life and fire insurance companies OF Wis
cOnSin, with assets aggregating S94. O00,-
000 pay but S34, 600 in the way Of taxes.
| There will ultimately, through a tax COM
mission or otherwise. be determined some
Just plan for taxing Them but in the mean-
time some of the unreasonable features of
the present system might be dispensed
with. Under the law now in force, fees
are collected from agents, as well as from
the companies. ! am persuaded it would
be wiser, temporarily at least, to abolish
al fees in connection with life, fire, acct
dent and casualty companies, except a level
license fee upon the gross premium re-
ceipts. A measure changing the methods
thus would not reduce in the least the
safeguards now placed around public inter
ests, while it would reduce expenses in
the insurance department and largely in
crease the states receipts
1t may be found that the proper method
of taxing insurance companies is to charge
q fee upon their gross incomes as is now
done in the case of railroads.
The Sleeping Car and Express Conn
panies.
In a special message transmitted to the
Legislature in 1897. returning without my
approval, for reasons stated therein, bills
taxing sleeping-car and express companies
doing business within the state, | took Oc-
caSiOn to express my views on the subject
in the following language:
l desire to call your attention to the imp0r
lance of these measures, and to urge upon Won
the necessity for properly enacting both bills
before the adjournment of this session. If we
to maintain in this state a righteous system
| of taxation it is necessary that to it that
large corporations doing business within
borders. and receiving without dlscr ninatiou or
stint the full protection of our laws, shall not
escape paying their just share of the expenses
| Of the government.
! | here reterate that recommendation.
These companies should contribute through
taxation their fair proportion to the eX-
! pense of the state government. That they
do not do obvious. / most ear
nestly commend this subject to your prompt
/ consideration and action. 1t is possible that
the best mode of reaching them is through
! charge upon their gross earnings within
! the state, whether it be called a license fee
! or 4 tax. If it be found that this method
cannot secure from these nonresident cor
| pOratiOnS 4 fair amount, there still re-
| mains the method of assessing them by
! what is known as the unit rule, which
! has been sustained by the Supreme court
! Of the United States in a case from Ohio.
The history of attempted legislation upon
! this subject impels me to call your atten
! ton to the Importance in passing such
| measures of observing the requirement of
section 8 of article of the constitution,
! which is as follows:
On the passage in either house of the Legis-
! lature of any law which imposes continues or
! renewS a tax, creates debt or charge, or
makes. continues renews appropriation of
! public or trust money, or releases, discharges Or
cOmmutes a claim demand of the state. the
! question shall be taken by yeas and nays, which
! shall be duly entered on the journal; and three
! ffths of all the members elected to such house
! shall, in all such cases, be required to consti
| tute a quorum therein.
There has been much discussion as to