The times. [volume] (Richmond, Va.) 1890-1903, 1902-06-10
our NEW PRINCIPLE OF TAXA.
TiCN

OUR NEW PRINCIPLE OF TAXA
TON.
That was valuable symposium Of
views published in The Times of Sum
day from members OF the Constitutional
Convention. The most Interesting COM.
munication Of all was that from Mr.. VIII
liam H Boaz on taxation and finance
mir. Boar says that the leading purpose
of the Committee on Finance and Taxa
ZION was to adapt the system to modern
ideas and conditions by requiring that all
property should be taxed orce and only
sonce.
s This Is tbs doctrine which The Times
s,has been preaching for a long. LONG
time, and It is most gratifying to US to-
know that this principle was made the
basis OF our new tax law.
..To accomplish this. Mr.. Boaz goes
on. at was necessary to remove the old
restriction upon the Legislature which
requires that taxation shall be equal
and uniform. In doing this it Is not in
tended that taxation shall not be equal
1n the true meaning of tho word, but that
the way should be left free for the inn
posing of taxes equal when measured by
the ability Of the Taxpayers.
1T was not, however. thought advis-
able to leave the matter entirely to the
will of the Legislature. so we say. tax
alton shall be uniform upon the same
class of subjects within tho territorial
limits of the authority laying the same
This permits the Legislature to classify
The subjects OF taxation and to impose
W
ing in rate as between the classes, but
uniform as to all subjects of a class.
lat present a large proportion of the
wealth of the citizen consists of stocks
or bonds Of corporations. This species
of property is Increasing rapidly under
existing conditions. This property has
to great extent successfully evaded all
attempts TO assess 1t for taxation. This
is owing to the fact that we have mere
tofore endeavored to reach this property
by taxing the securities in the hands OF
individuals after having already taxed
the capital which these securities repre-
sent, to the corporation itself.
1.-THE natural reluctance to pay taxes,
supported In these cases by the conten-
ton of the Taxpayer that his property
was being subjected to double taxation.
has contributed to bring about the result
that only the ignorant and extremely
honest return this species Of property,
thus making the payment Of such taxes
q burden upon ignorance and honesty
and q premium upon fraud and dlshon-
esty.
1.-THE new Constitution proposes to rem
edy this evil by taxing this property at
the fountain hcad-that is. in the hands
of the corporation itself. by imposing
upon corporations taxes upon their prop
erty, and in addition franchise taxes.
The actual property and the franchise
constitute the whole of the value of the
corporation property, and the shares or
stock are nothin but certificates of own
ership therein, So we provide that all
the corporation property being once
taxed. the shares Of stock shall not be
taxed =
Many of our readers will recall that
this was the line of argument pursued
by The Times in discussing this inter-
esting and all-important subject. We
have endearored to show that the way
TO prevent tax-dodg.ng Is to tax Che
property in sight-the actual property.
and not the evidence Of ownership or the
evidence of debt. We believe that cor
porations should bear their full share of
the tax burden. that they should be made
to nay taxes on all the property which
they own, including that intangible, but
nevertheless valuable, thing called q
franchise But when the corporation
has paid all its taxes that are justly
due Il is unreasonable and a species OF
double taxation to require the holders OF
stock in such corporations to pay an adj
ditional tax on their holdings. In at
tempting to do this the State has en-
couragcd tax-dodging and has made some
pay while many have gone scot free. The
State has undoubtedly lost revenue by
this system. and it will largely increase
its revenue by adopting the new system.
But this system of taxing corpora
lions should not be confined to railroad
{ ence In kind between share of stock
In q railroad corporation and a share
OF stock in an Industrial corporation.
Yet tits claimed by the commissioners
OF the revenue. and they seem to have
ample law to back their claim. that,
while railroad BLOCKS are eAempt, us
stocks of Industrial corporations. except
they be interpretations strictly of the
State Of Virginia. are subject to taxa
ton. There is great confusion on this
point and many honest taxpayers are
honestly in doubt as to whether OF not
they should give in for taxation certain
shares OF Industrial corporations whose
property lies partly within and partly
without the State Of Virginia We sim
cerelv hope that the Legislature in franz
ing the new tax law will clear up all
these doubts and exercising the discre-
ton given that body by the new Const-
tasion frame tax law which shall be
fair and just and ineligible.
In conclusion, let us say that another
species of unjust taxation is the tax
upon mortgages, and it is to be hoped
that the Legislature will do something
to relieve debtors OF this burden. for.
after All. the mortgage tax Is paid by
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