The Independent. [volume] (Honolulu, H.I.) 1895-1905, 1900-07-14
DODGE AFTER THE BIG SUGAR
PLANTA IONS.

800" OOAASSbtU Au0 y
ahree Corporations Although
Plantations Are in the Sandwich
Islands They Must Pay the Tax.
Assessor Dodge has collected the
taxes on the following franchise as.
easements: Hutchinson Sugar Plan.
tstion, $l,000,000; Kilauea Sugar
Plantation, $25.000; Union Trust
Company, $4,000.
The Assessor states that large
amount OF taxes has been collected
on the sugar stocks OF those corpor-
atoms, whose property and place OF
business is in the Hawaiian Islands.
"This Stock" said the Assessor,
"being that OF foreign corporation,
is taxable, aud has been returned for
taxation by many taxpayers, accord
ing to law. The stock OF a similar
corporation also having it's property
in the islands, but which happens
to have its Office or corporate home
in San Francisco, lie, according TO
our statutes, exempt from taxation.
Hence, unless its franchise is taxed
n Ii eu OF the capital stock, those
who have invested in this stock es-
cape paying any revenue to the
Government which gives them its
protection. This is not just. Un-
less the franchise is taxed we have
this condition: A may put 100000
in the stock OF sugar plantation
having its Office or corporate home,as
we'll as its property, in Hawaii, and
the law compels him to pay a tax on
this capital stock OF $1,000, say, if
computed at our last years tax rate.
B also invests 100000 in the capital
stock OF an adjoining plantation in
the Islands, which, however, hap.
pens to be incorporated in Califor-
MIA, but which has it's office here,
and pays no tax here. B claims his
stock is non-taxable, as it is that OF
a California corporation.
Shall BIS inves.ment!there OF $780,
600 contribute nothing in taxes,
while A pays the city $1,000, simply
because the investment OF B is in a
corporation which happens to main
tain an office in California.
| California enjoys no revenue in
the way OF taxes from this corpora
ton, simply because it has an office
here. Why then should its stock
be exempt from taxation, while that
stock representing the adjoining
plant alton ia taxed. This discrimin-
alton is indefensible, When the
franchise, however, OF the California
corporation is taxed, as our law con
templates, then each of it's stock
holders contributes indirectly his
share of taxes. Has this latter
stakeholder any cause for complaint
when his neighbor is taxed accord
ing to law directly on the capital
stock he holds in the Hawaiian
crop? think not. Only the taxa
alton Of the franchise is the best
system for then every stakeholder
contributes indirectly his part of
the tax; though receiving dividends
which are slightly diminished.
While If the stock is taxed directly
one stakeholder returns his stock to
the Assessor and pays on it, while
another conceals his and pays abso-
lutely nothing on it. But assess the
franchise as representing the capital
stock and not one shareholder es-
capes paying his share Of the fran
chise tax.
"Now, in my opinion" said the
Assessor, "the franchise system OF
taxation, judicislly carried out, is
superior to the method in vogue in
other States OF assessing the capital
stock of all corporations, domestic
, or foreign."-S, p. Bulletin.