Omaha daily bee., 1902-05-18

goes in and he must make a showing Of the
tangible property. while the stock is not
assessed. Or. take, for instance, a depart
ment store, one which is owned by a stock
company; the stock OF the department
store may be very valuable, it may be
worth 300 cents on the dollar, but the de-
partment store is only taxable for the mer-
chandise It has on hand. 1t cannot be
taxed for the good will. when 1t has been
built up by reason OF years Of advertising.
1t may spend 5000. &c., 900 or SIS. 900 a year
In Advertising. 1t has built up a big trade
and that trade may yield them an enor-
nous profit and they divide that, pront
among themselves, but that profit Is not the
basis OF taxation. That would be an Income
tax. II "a altogether an intangible thing,
but the goods on hand, the merchandise,
money, credits or bills receivable are all
to be returned and that is all there is to It..
Now, It is so with banks. You take a bank
ing corporation; II has a franchise because
1t has the right from the state or from
the nation, but the stocks are not appraised
at their selling market value. II is only
the capital actually invested that is taxed.
It's stock might be worth 500 cents on the
dollar. 1t is only the money actually in
vested In the bank hat Is taxable, but with
a franchised corporation there are other
things. TAXI the privilege that is exclu-
siyely enjoyed by transportation agencies
for the publicl II is such privilege that
gives 1t an extraordinary value and gives 1t
an earning capacity way beyond the ordi-
nary investment. II we should take, for
example, the tangible property OF a rail-
road. Its ties and rails, its rolling stock
and Its material they would cut q mighty
small figure In the value Of the property
in that shape, but the moment they lake q
right-of-way from the public for the pur-
pose Of transporting merchandise or become
. public carrier the public must pay the
toll subject to the restrictions OF the state. I"
Tar on Railroad Franchises.
Mr.. Aver: Would you consider It proper
TO tax the franchise Of a railroad tina Is
losing money!
Mr.. Rosewater: Its franchise would be
worth nothing under those circumstances
The moment you show that its stock lie moi
selling-take for instance the Union Pacific,
when Il was In the hands of receivers, iti
stock was selling then for S cents on the
dollar-you couldn't have taxed II ther
for any more than its tangible property
but now II is OF value. but in two years from
nov or ten It may go back to where It was
A season OF depression might strike the
country" ,
: Mr.. Ager: Then the franchise itself nuc.
tuates with the price Of the stock"
Mr.. Rosewater: 1T does"
Mr.. Aker, ut might. have a value OF nigh
have no value"
Mr.. Rosewater: Yes sir. 1t is one Of thos
uncertain nuctusting commodities or proper
ties that Is dependent entirely upon publ,
good will or upon special privileges or spe
cial conditions that gives the opportunity
for earning profits"
Mr.. Assr; 1T ought not then to be takel
into account by the assessors unless tn
property is earning something"
Mr.. Rosewater; when property Is no
earning anything its stocks are not sale
able. BY reason OF these recent merger
that are taking place ell over the eountr