The times. [volume] (Richmond, Va.) 1890-1903, 1901-12-22
Taxation.

Editor of The Times:
Sfr,-Nearly all controversies arc the re-
suit of the misunderstanding of the terms
used by the controVerslausts. In your
comments on my letter, published l1tn
instant, you say that when corpot ation
has paid the tax on all of i1a, property
that the Stockhoidcr should not be ~
CURED to pay on his stock. II by that.
you mean that the corporation has raid
on the amount of stock issued, You are
right: but il you mean that the corpora
ton has only paid on the real estate, ma
Ghincry, etc, or on whatever tangible
form its holdings were hello, and had not
listed for taxation the certificates of
stock issued by the corporation and sold
TO the public. then beg leave TO say, with
eil The courtesy / can. That You are
wrong. Because. first. the amount Of real
property held by the corporation may be
but a tenth OF t;3 stock issued; then ~
pei. cant. of the stock would not have
been paid on. And second, because the
stock thus sold 70 investors, for income,
becomes AN investment in the hands of
the general public. il has been bought
fer money, which money is now subject
10 taxation, and the state REQUIRES its
listing. And just here Will answer the
enquiry as 10 why exemption from taxa
ton affects the earnings or net disu1bu-
ton CT stock companies, though did
not say that in my letter of 17th instant.
] said that the abatement of the tax
would increase the income Of stock and
bondhoders, which is perfectly plain,
whether the tax be paid by the corpora
ton on gross or by the individual holder
OF certificate OF stock, for if the bond or
stockholders pay no tax in either of those
WAYS then their gross income from dlvl-
dends would not be diminished by the
amount of the tax, and their income con-
sequently greater. ] never intended TO
say that the skill. efficiency or earning
power OF the corporation would be IN
creased by not Having its stock taxed.
but ] did say that stocks and bonds he'd
by the creditor class would be the reel
pient of the tax abated.
And now as TO the lesSening OF the rate
of interest. II no tax is charged on money
loaned on real estate, competition ifaS
something to do with the rate. But THIS
competition, as is known by the rapid
changes in our money center. New York,
IS Of that nature, that while the abate-
n!ent, If made, would be permanent, the
rate for loans would never be permanent,
but changing with every demand made
on the amount of money in use to handle
the great cotton and wheat crops, aud the
immense products of the West ba con
lard etc, the rate would vary. and loans
on real estate would be easy. when money
is easy, and hard when money is hard 20
get and higher or lower, according to
these conditions.
do not desire to leng;hen this let
ter, but the fact is, that nearly all ser-
Gus troubles in all countries Of recent or
modern times came from the work of
some large class. an influential class. to
sroid taxation. Rome, With her agrarian
agitations: France in the eighteenth cen
tury--but I leave to the intelligent reader
TO fill in what can he said on the subject.
and say that all values, not exempted by
- Il. 80 tA,.a
T. C. GODDIN.
Richmond. Va. Dec. 10. 1901.
On discussing this question VIC have al
ways held tnat corpora tons should pay
taxes on all their property, including
franchises-Ed. Times)