The sun. [volume] (New York [N.Y.]) 1833-1916, 1900-04-08
DEATH TAX u MILLIONS.
4 HEiP or GEORGE SMITHS MONEY
GOES RACK IO THE PEOPLE.


First, Great Britain Took n
,sitce-Then si.. 900, 900 Of the Estate Arc
Found In New York state Takes Two
Millions; Federal Government More.
II will take n largo share OF the estate In
this country LETT by George Smith. tho hermit
millionaire who died In London last
fnll. to lay the inheritance taxes levied
by Great Britain. this state and the Federal
Government. 1t cam out last week
that the New York state Governme nt had
collected nearly two millions OF tax on the o.
tate from James II. Smith OF this city. who was
the chief heir 10 the for une OF nearly q nun.
dred millions that was left blythe reclise. the
money was collected some time ago by comp
troller Coler. The matter was kept secret Tor
the reason that. according TO the Comptroller
II was not advisable TO let II be known that the
State had had any such wlndiall while the Leg.
~lslature was in session. II the Legislature had
known that there was any such amount oil
money that was available for use 1t might have
found some use for the money and the State
tax would not have been reduced as II was.
George Smith was a native OF Scotland, lie
came here when he was a young man and went
to Chicago where he made a fortune In tbo
| real estate business, He went back to Scot
land and lived there for a while md then got
tired NJ doing nothing and came back 70 this
country with his fellow country man. Alexander
Mitchell. Together they established an insur-
ance company in Chicago, which also had
banking privileges. 1t was almost the pioneer
banking enterprise OF the Northwest. The
partners issued notes which were known all
over the West as George Smiths money" and
It passed anywhere In that part OF the country.
From the banking business the partners went
into the railroad business and they organized
the Chicago. Milwaukee and 81. Paul Railroad,
which is now ono OF the great railroad systems
Of the country. Smith finally returned TO Lon
don and there he led the life Of a recluse in the
London clubs. He dropped lmost out OF the
sight OF the people OF this country though the
greater part OF the vast fortune that he had
accumulated was here and was Of the sort that
he could not carry away.
James II. smith, who IL the junior member
Of the nrm OF Geddes and Smith. Wall Street
brokers. was his nephew. When George Smith
died and the fact that he had left u fortune OF
nearly II not quite a hundred millions was
printed in the newspapers. so completely had
he dropped out Of sight in this country that
eve rybody asked Who Is George SMITH" and
when they learned that his principal heir was
James Ii. Smith most people asked Who
Ia he?"
James H. Smith is a good deal like his uncle
In that he does not ike notoristy and he wac
lite known outside the circle Of his personal
law in Great britain, and the British Govern.
ment got right after the smith fortune.
Under the British law the estate was
appraised and taxes were assessed TO the
Federal Government has q law imposing a tax
on inheritance., and under this law al that
part Of the estate tina, Is IN this, country has
been appraised and the tax will collected IN
due time. The constitutionality OF the law 10
In question however. and II is how u the SUI
PRIME Court, not q, in tnG ~ Sm.th S Sr1e; ,6 but h IN an an:
lectei and the amount OF 1t will not be de.
tlnltely known until the court decides the case
| The New York State authorities were the last
to get after their share OF the estate. When
George Smith died II was supposed that MS he
was made in the city OF Chicago this state
would yet no share of the taxes TO be collected.
The collection OF the inheritanc' tax for ne
city. He gets l per cent. Of the amount that
is collected for the work. When Comp.
TROLLEY Coler went looking around after
| city he found that there was something over
forty-two millions Of dollars In bonds that
belonged 70 the estate aud that were actually
In this city. The fact that they were actually
In the city made them subject 10 the collateral
Inheritance tax that Ia imposed, BY the state
| ana ne sent MS appraisers 70 MT Janus II.
| Smith to appraise the property and to assess
the tax. The appraisers found that the legatee
was perfectly willing to pay any legal tax and
he he ped them in all ways possible 10 get at
the actual value OF the estate. As stated be-
fore they found the va'un to be. something
more than f0rty-twO millions and when the
amount OF the tax wa made known TO Mr.,
Smith he drew a check for the amount without
question.
As Mr.. Smith was no nearer kin to George
Smith than a nephew, the tax levied under the
law was 5 per cent. OF the gross amount ~ the
property that was left, with a reduction OF 5
per cent. OF that Tor prompt payment. and the
State GOT nearly two millions,
COMPTROLLER Coler said yesterday that after
he had collected the money he reported II only
TO the Governor and to the State Comptroller.
and they agreed with him that Il would be bet
ter To keep the fact that the money had been col
lected from the knowledge OF the mem bers OF
the Legislature until after that body had adj
J%ourncd. or at Least until the tax rate for the
year had been fixed.
What will be the Federal Govern ment tax
on the ~estatef' asked the reporter.
Il do not know the exact amount" sal! the
Controller. pat the whole tax viii be In the
neighborhooi OF twelve millions OF dollars.
The law under which the Federal Government
assesses the tax u in Dispute and until the
Court decides the cOnsttutlouallty o. the law
no one can tell exa:tiy what the tax will be-