The morning news. [volume] (Savannah, Ga.) 1887-1900, 1899-05-16
RATE OF TAXATION TOO HIGH.
WHY SOUTHERN BANK PROPOSES
TO REDUCE ITS CAPITAL.

The Resolution to Amend the Char
ter Adopted Unanimously at the
Stockholders Meeting Yesterday.
High Taxes the Cause of the Pro-
posed Reduction. Says President
FIannery-Dank Can DO Just as
Much Business with One-HnIf Its
Present Capital stock and Save
Several Thousand Dollars a Year
Into the Bargain.
At the meeting of the stockholders Of
the Southern Bank. held yesterday, it was
unanimously decided 10 apply to the sec
rotary of state for an amendment TO the
banks charter. TWO separate amendments
will be asked for. The present charter Of
the bank. which was obtained nearly thir-
" years ago, and which expires next year
provides that the capital stock of the
bank shall be 5000, and that it may he
increased to any amount not to exceed
5000. 600. No provision is made for de
creasing the capital stock.
The meeting decided 20 ask for an
amendment permitting the decrease Of the
stock in the same manner as other banks
now holding state charters. The meeting
did not decide upon any decrease in The
stock. though this is under contemplation
The second amendment, which VIII be
asked for relates TO the liability OF the
stockholders. Under the law under which
charters are now issued to banks by the
secretary of state the liability of the stock
holders is limited TO the face value OF the
stock held by them, which is in addition
TO the amount already invested by them
That is, they are liable to lose the value
of their stock and to be assessed to the
amount of its face value besides This
would apDear to be ample security, but
the charter OF the Southern Bank goes
even further. Its stockholders are liable
for the fun amount of the ultimate ia
ties of the bank in proportion TO their
holdings of stock.
The stockholders Of the Southern Bank
think the provisions of the state law TO
be sufficiently far-reaching and desire TO
avail themselves of these provisions. rms
amendment was of secondary importance
however and would not have been sought
had ii not been for the desire to amend
the charter in order to permit Of the re-
duction in the capital stock.
The president of the bank. Capt. John
Flannery. was asked the reason for the
contemplated reduction in stock. He re-
Piled that the main reason was because
of the heavy taxation.
THE combined state. city and county
tax rate amounts to pa per cent said
Capt. Flannery 1.-THE banks cannot hide
out their stocks, as many private hold
ers undoubtedly do their securities. and
the cons sequence is that the tax burden
falls very heavily upon them. The bank
can do Just as much business with half
its present capital stock as it is doing
now. The amount of the capital stock is
not OF special Importance"
Speaking of the present tax rate Capt.
Flannery remarked that not many years
ago the banks only paid $40 of one per
cent. on their capital stock. The Su-
preme Court, however. decided that the
same tax rate must be levied upon all
property, and hence the present high
taxes
The Supreme Court of Pennsylvania,
with the same provision in it's constitution.
decided just the reverse said Capt.
Flannery. IF all holders of securities
would return them for yaxation the bur
den would be more evenly distributed,
but under the present system the burden
talls heaviest upon those who make their
returns honestly"
The present capital of the Southern
Bank is $4,000. What the reduction viii
be has not been decided, but it is likely
that the stock viii be cut in half, a price
nxed upon that TO be taken UP and each
holder of two shares allowed one share
The reduction by one-halr would mean a
saving OF several thousand dollars an
hually 10 the stockholders of the hanu
NO MORE COLOREn RECRurrs