The evening times. [volume] (Washington, D.C.) 1895-1902, 1901-07-15
FINANCES OF PORTO RICO.
Mr. HolIander's Work in Establish
ing a Revenue System.
The InsuIar Treasurer RctJrns to
New York and Talks interestingly
Upon the Introduction OF Amcri-
can Methods in the Islands Affairs

NEW YORK. July 15.-Amons the pas
sengers who arrived today on the steamer
San Juan from San Juan, Porto Rico, was
Jacob II. HoHander, treasurer OF the ISL
and of Porto Rico Mr.. HoIlander, who
holds the chair of assistant professor Of
finance at Johns Hopkins University, was
| sent to Porto Rico by the President to
formulate q revenue system His leave
of absence expires on October / When
| seen at Quarantine this morning Mr.. Hoi-
lander said he was on his way home on a
| leave Of absence to attend to some per
/ sonaI business. As to his future move
| ments he could give no idea. He had no
information concerning the rumor Of his
proposed trip to Manila He had not been
asked TO 60 Mr.. HoHander gave out the
! following staten.ert concerning his work
in Porto Rico:
The present financial condition Of Por-
to Rico compares favorably I think with
that of any State or Territory in the Tn
ion. The island $ free from all funded
or floating Indebtedness; the burden Of
| taxation upon its people is less than upon
the residents of any other part of the
United States; and the insuIar treasury
begins a new fiscal year with sources Of
revenue that should supply all necessary
expenditures and with a surplus large
enough to afford security against any un-
foreseen contingency. These are the con
ditions which made it possible for Gov
ernor Allen to convene the Insular Leg
islature in extra session on July !, and
for that body to pass the joint resolution
as to the adequacy of its present revenue
system. which, it is hoped, will soon re
suit in free trade with the United States
The annual expenditures Of the island
are about s. eo0,O1g of which about half IS
devoted to schools and roads. Necessary
revenues are supplied by customs duties
on goods imported into Porto Rico from
countries other thIn the United States;
by excise taxes on alcoholics tobacco,
and a few rnino. articles; and by direct
tax Of one-half per cent uprn real and
personal property. Any deficiency II cur
rent receipts Will be supplied from out
the reserve funds Of the insular treasI-
" of which one item alone, customs col
IcctiUus on Porto Rican exports into the
United States since May / 1900, aEgre-
gates $6'0,050, no part of which the insular
government has found it necessary 10
draw upon up to the present time. These
results have been made possible by the
generous action of Congress in appropri-
atinE customs duties on Porto Rieaa trade
to the insular instead OF the Federal
treasury. and by eXempting the island
from the operations Of the United States
Internal Revenue laws thus leaving the
way clear for 4 local system Of excise
taxes
of the 100000 that Porto Rico spends
annually S1.5g2gJ0 accrues from sources
customs duties and excise taHes-that in
every part Of the United States are ap-
propriated by the Federal Government
In other words. as compared With every
other State and Territory in the Union.
Porto Rico is enabled to expend for its
own use and benefit four times the
amount that it derives from insuIar taxes
proper.
The actual operation Of the new rev
enue system Of the island has been as
satisfactory as its results In the begin
ming unfamiIiarity with the law and the
spirit in which it was to be administered
excited some alarm that political UaIcor--
tents exploited 10 the utmost. But as fen
I ture after feature OF the system has been
put into operation the Intelligent senti-
mcut Of the island has accepted it cor
daily, and at the present time the only
criticism proceeds from those who are
now opposed not TO any but to all tax
alton. or ar immovably attached tC the
old Spanish system Of heavy Indirect
taxes upon necessary consumption and
inadequate taxation or entire escape Of
property ard capital,
The excise taxes are limited 70 arti-
cIes Of luxurious or injurious coHsump-
tion and are less in number and in
amount than the United States internal
revenue taxes They have neither injured
the producer nor burdeued the consumer
Thus rum. the most important item IN
I the schedule, is a by-product Of 3 thirty
ing and highly favored industry and the
/ effect of the tax upon consumption has
simply been, i anything to cause il TO
be drunk in more dilute and isss harmful
form. Exported articles are exempt from
/ The cxcisss. The production Of cigars and
cigarettes has advanced by strides with
the opening Of the American market So
/ general has been the popular acceptance
[ Of the excfs taxes and so efficient their
/ enforcement that five months of operation
and the collection Of nearly quarter of
million dollars thereIrorn have ueoes-
STATED barely single prosecution for
/ violation of the law
The history of the property tax is much
the same The preparatory assessment
the first in the history Of Porto Rico. Was
madS on d siuguIarIy high plane Of IN
II and efficiency. Property agEre-
gazing 800, ,o1oogy was assessed and some
/ s. 60 tax schedules were returned; yet
the executive council. sitting as "a board
Of appeal. received complaints from less
than 30 taxpayers. The rate Of taxation
IS y per cent for insuIaE and a maximum
Of 2 per cent for municipal purposes,
these making the aggregate tax burden
lupon property in Porto Rico less probably
than in any community in the United
States
| The administration Of the revenue sys-
TEN Of the island has been characterized
! by the greatest Ienieucy and midmess.
Since civil government was established on
! May l. 1863 there has been no single sale
! Of property for delinquent insular taxes
| except where careful investigation has
made it clear that the delinquency was
! deliberate. This same policy VIII be even
| more conspicuous under the new law
| Instead Of the Spanish method OF Il
premio,' providing for the outright sale
Of property within ten days after any
land property or license tax had become
| delinquent, the new measure provides a
period Of grace and a period Of redemption
and. more remarkable than this. abso-
lutcIy prohibits any tax sale Of property
| uUfU the S0eriTc circumstances thereof