River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1903-02-12
CURE SICK HEADACHE.
HOW THE RAILROADS ARE TAXED.
EXPLANATION OF LICENSE FEE SYSTEM
RAILROADS DO NOT ASSESS THEMSELVES.

ISSUED in Behalf Of Wisconsin Rallways)
How are the railroads of Wisconsin
taxed? One would suppose. after all that
has been said and written on this subject
during the last few years, that everybody
would now know. But this Is far from
being true. And II we may judge from
the number Of questions that have peen
put 10 us, we may say that those VINO aLH
familiar with the provislons Of the Ia"'
would not form very large multitude
LICENSE FEE SYSTEM.
In explaining the taxation of railway
and of some other corporations that pay
the socaIled license fees, the Tax ToIlIns
sion on page 20 of It's first annual report
said: Certain classes Of corporations OF
persons engaged in quaspublic enterprises
are required to contribute to the pupllc
revenues amounts not measured or appof-
toned by property valuations, but uSualIy'
by fixed percentage Of the income pro-
duCcd from operation OF the business en-
gagged In. Generally 1t Is in form a license
fee charge for the privilege OF CON
Quoting the enterprise. But ordinarily II Is
more than q mere charge for a business
privilege franchise. In most instances
1t Is essentially measure OF revenue the
fee or charge being impOsed-with slight
exceptions-in lieu Of other forms OF taxa
ton"
That the fees collected from the rail-
roads something more than n mere
charge" for business privilege appears
pretty plainly from the provisions OF the
law. Under present statutes, the rate or
taxation is graduated according to the
average amount OF annual gross earnings
per mile Of road viz:
On roads earning $4,000 per mile or over
4 per cent OF gross earnings;
On roads earning $500 and less than
$1,000 per mile, 81 per cent OF gross earn
ings;
On roads earning $4,000 and less than
$500 per mile per cent OF gross earn
ings;
On roads earning $500 and less than
$1,000 per mile, the tax Is 50 per mile ana
of $500 per mile;
On roads whose gross earnings are less
than $500 per mile the tax Is SO per mlle
GROSS EARNINGS.
The license fee or tax is based upon the
annual gross earnings from operation In
the state, including such earnings from In
terstate traffic as are earned within the
state. The gross earnings, from which the
amount of fees is determined. are ascer-
tanned from statements made annually, by
each company under oath of an officer, to
the State Treasurer and to the state Kali
road Commission. The latter ohlcer is re-
uuired to approve the report made to the
Treasurer before the license eur he issued,
authorizing the company to continue It's
business.
RAILROADS DO NOT ASSESS THEM
It is often said, generally by those who
wish to uproot the license fee system, that
under this system the railroads assess them
selves The railroads make returns annual
the law of the state does the rest. The re-
ports are sworn to, and before license
can be issued the Commissioner of Rail-
roads must approve the cOmpany's report.
Thus it appears that the reports of the
railway companies are not final and con
elusive it is not only the privilege but
II Is the duty of the Commissioner Of Rail
roads to review them.
There Is never so thorough n security or
the ordinary taxpayers schedule as there
is of the railway company's statement of
its gross earnings. If there were. much
Of the property which now escapes taxa
ton would be on the tax roll and this Will
be admitted by every candid man.
Railway officials may not he more honest
than other people, but they are surrounded
nv conditions which not only enable them,
hut which compel them to submit full and
accurate returns. They are obliged to make
many reports to the officials of the different
states, to national officials and to their own
stockholders 1t would be impossible so to
iuggle the figures as to hide anything dis
honest Anything crooked would inevitably
appear on a comparison of these different
reports.
How many citizens OF Wisconsin Pay per
cent. of their gross income for taxes? All the
principal railroads pay per cent.