The Birmingham age-herald., 1903-01-25
Views of the Administration on
 the Revenue Bill
WILL REDUCE THE TAXES
It Is Said Opposition From the Banks Was Expected, as 1t Puts Them In Position of Competitors
 of Deposltors.

Montgomery January 2.-(Special.)-A comprehensive defense of the stamp tax provision in the revenue bill now before I the legislature was given out here tonight | by a close friend of the administration. l This interview, It Is stated, embodies l the views of a majority of the code com
 mittee which drafted the measure The 1 interview follows:
 "There seems to be a misunderstanding
 among some as to the intent and purpose 1 of the taxes levied on notes. mortgages. 1 etc., under the new revenue bill. The ef- feet of this measure if adopted, will be to materially reduce the taxes on solvent credits, and will make the burden equal
 on all. It will also reduce the rate of in- terest regardless of the contention of the banks Any one who will take the trouble of Investigating will find that the present system of taxing solvent credits is unfair and unjust, and prohibits individual money lenders who citizens of this state from competing with banks and for eign loan companies.
 '"The legislature must do one of three things, viz: Continue the present unjust system, make the taxes on solvent credits equal or abolish the tax altogether. The state, by the provisions of this bill says to its citizens. banks and foreign loan companies: You may lend all the money in this state that you desire, and the only tax required is 10 cents per $10O of
 the amount loaned, but this tax must be paid by all, whether 1t be an individual. 1 bank or loan company. This would ir- 1 crease competition among money lenders, who would be compelled to reduce the rate 1 of interest.
 l
 " Hard on Small Leugers. Under the present law # a citizen of | Montgomery loans one thousand dollars | he has to pa, the state and county twefxe dollars and i ty Is and to the city of
 Montgomery eleven dollars and a quar-
 ter, making a total tax of twenty-three
 dollars and seventy-hve cents each year. l If he deposits one thousand dollars in
 bank for safe keeping the bank can loan 1 1t without paying any tax whatever. The
 same applies to foreign loan companies. i The banks of the city of Montgomery
 have on deposit about four million dol
 lars of this amount only $29, 707 was 1 sessed for taxes in the year 1901. 95 per l cent of the solvent credits assessed for i taxation in this country are returned by | widows, guardians and trustees. These l conditions exist throughout the entire state, as shown by the auditors report or ] 1902.
 Gan any fair man say that 1t is just | taxation? If the state will relieve It's citizens of the present high tax rate and l place them an equal footing with i banks and foreign loan companies by l taxing them all equally the result as 1 heretofore stated will be to reduce the
 rate of interest. Unless this Is done the
 banks and loan companies will continue 1 the monopoly.
 Borrower Would Save Interest. "It has been suggested that this tax | will be paid by the borrower. Suppose this is true, the borrower could well af-
 ford to pay ths small amount of taxes
 If he could save from to per cent in 1 interest which he could easily do. It has l been suggested also that 1t would be | hardship on banks to pay on short loans 1 when they are renewed several times
 during the year. In these cases the com l hound interest would be greater than the ! increase in the taxes. In other words the
 banks would receive a larger rate of In
 terest on short lcSn than citizen would | on q loan of twelve months.
 l ,It ia only natural for the banks to on- l feet to this tax as it will force them to | bear their share of taxation and will | make their depositors their competitors. | It will also force them to pay Into the
 state treasury one-tenth of 1 per cent of 1 their loans. which at present Is carried
 to their surplus account. The auditors
 report of 1902 shows that for the year
 1901 there was assessed for taxes in the
 entire state on money holdings only H.- | 6625; money loaned and solvent credits. S9S9.3l6.
 The taxes on these amounts was s95.- | CA 23 Seventy-five per cent of this was
 paid by widows guardians and trustees. 1 If the new revenue bill is passed the state
 will get more than quarter of million | dollars on money loaned and solvent | credits, against the above amount under | the present law