Evening star. [volume] (Washington, D.C.) 1854-1972, 1902-05-23
THE Personal TAX
How It Operates id American
Municipalities.
INEQUALITIES % : PROVED
b. 81
A RESEARCH SHOWS IT'S Diff
GUILTY OF COLLECTION.
Such Tax is Mainly Borne by Wild
ows and orphans-A Strong
Showing.

to accompany the statement to the houses
of Congress relative to the question of taxes
in the District. from which an extract was
published in yesterdays Star, contains fur
Their matter of pertinent interest at this
time, with the subject under discussion by
the Senate appropriations and District
committees. The appendix proceeds:
1t Is OF the essence Of a just tax that 1t
should not only be proper in its objects, but
that 1t should be proportioned to the abili-
ty of those upon whom 1t is levied. 1t is
unscientific and uneconomic to assume, ar
bitrarily, that a certain amount must be
raised by taxation at any one time, and
then to proceed and levy and collect the
tax without regard to the ability of those
upon whom it is levied to respond.
1t would be difficult to find, we submit,
any instance in the history of municipal
taxation in which a community paying, in
round numbers; 100000 in taxes in any
one year. has been expected to raise $780,
COO the next year by regular taxation. 1t
is, of course, admitted that taxation should
be uniform; and if the assessors have been
discriminating in the discharge of their du-
ties, those irregularities should be correct
ed, but they should be corrected because
they are irregularities, and not because an
Difficulties in Levy of Personal Tax.
The citizens of the District of Columbia
are not opposed to personal tax bill. They
do not deny that personal property, not
taxed in any way, should together with
real estate bear its proportional part of the
burden. 1t must be recollected, however,
that among the many difficulties which
present themselves with respect to personal
taxation there is one that would seem to be
inherent. In the assessment Of real estate
it is understood that it is not to be valued
for purposes of taxation at the selling price
which a man could get for it who was not
forced to sell from another man who wan
ted to buy. In practice, whatever the theory
may be, real estate Throughout this country
is assessed much below the value referred
to. While there are wide departures from
the rule, nevertheless it may be said that
60 per cent of its actual market value at
sale under favorable circumstances, is the
price set. Therefore,Aa a man who pays ~
per cent upon the assessment, as in this
District, pays much less than that upon the
market value; but when we consider per-
sonal property, as, for example, bonds and
promssory notes. If these were assessed al
their actual value. a man who paid ~ per
cent upon that value would pay, in some
cases, almost as much as he would re-
ceive by way of annual return upon his
property. The current rate of interest in
this District upon real estate loans is from
to AZ per cent The payment of tax of
~ per cent would leave '21A or s per cent as
the net income. In other words the income
of many persons, widows, orphans and 9TH
ers who live upon their personal property
would be re~uced by one-third. A reduc-
ton from 81 200 to $500 a year would be a
very serious matter for many famules in
this District. A reduction from 5000 to $500
would be more serious still. This Is to be
borne in mind when we reflect that, as we
shall presently see, the personal tax is
mainly paid, not by the wealthy, but by
persons In the middle class Of life who can
least afford to pay it.
Experience Elsewhere.
The inherent difficulties connected with
the levy Of a personal tax should be borne
in mind in the framing of any bill upon
the subject. and an effort should be made
to simplify such tax to the greatest pos
sible extent. and to render it as little bur-
densome as possible. No more drastic leg
islation could be devised than that which
is imposed by the laws of Ohio. An exam
ination Of those laws and Of their practical
operation was recently made by Professor
Richard T. Ely of the Johns Hopkins Uni
versity, and also a member of the Mary
land tax commission, who, in the year
1883, published a work upon the subject OF
Taxation in American States and Cities"
On page $50 of this work he says, speaking
of assessment of real estate:
Real property is valued all the way from
20 per cent of it's true value down to 25 per
cent. A state board of equalza ton is elect
ed, whose duty 1t is to see that property
in all parts of the state is equally assessed:
and right here we encounter difficulty
Each member of the board is elected from
a senatorial district, and ne feels that he
represents his constituents and not the
state of Ohio, as the law cont emplates: con-
sequently each tries to reduce the assessed
valuation Of the part of the state which he
represents, all oaths to the contrary not
outstanding I was told in Column
bus about one conscientious official who
tried to carry out the law, and place all
property upon the tax duplicate. The only
comment made was this: He was never
re-ele cted.'
Another somewhat similar case came
to my notice in New York. Faithful local
assessors were diligent and successful in
finding property for some time; whereupon
some of the moneyed men Of the place
drew up petition for the abolition of the
local board of assessors and canvassed for
signatures, with the demagogical plea that
the local board involved a needless waste
and that property could just as we'll be
taxed on the general assessment for state
and county purposes. Many signatures
were received before people seemed to real
ize the character of the undertaking. The
petition was taken to Albany and the board
abolished by the legislature.
Connecticut and Ohio.
1.-THE Connecticut special tax commission
erS HdrIdte the experience OF an assessor
in that state who, by diligent search, sue
ceeded in finding s260,OOO Of Intangible per-
sonal property, such lfas, railroad stocks and
bonds. and money at interest, and added
it to the general list, and he writes to the
commissioners that imay have had some
thing to do with my defeat when election
came around"
In special message of the governor of
Ohio, dated April 9. 1887, he says:
Personal propertyfs valued all the way
from full value down to nothing; in fact
the great majority Of, the personal property
of the state is not returned. but entirely
and fraudulently withheld from taxation.
So far as personal property is concerned
the fault is chiefly with the people who list
their property for taxation.,I The idea seems
largely to prevail that there is Injustice
and inequality in taxation, and that there
is no harm in cheating the state, although
to Go SO false return must be made and
perjury committed.
I'm connection with the recent refunding
of our state debt, maturing next December,
1t was disclosed that some of the most
prominent and highly respected men of
| our state held large amounts of these
| bonds, without ever having Maid a dniia r