Vilas County news. [volume] (Eagle River, Vilas County, Wis.) 1896-1927, 1903-02-16
HOW THE RAILROADS ARE TAXED

Explanation of License Fee System
Railroads Do Not Assess Them
selves.
ISSUED in Behalf Of Wisconsin Railways)
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 if we may judge from
the number of questions that have been put
to us, we may say that those who are ia
miliar with the provisions of the law would
not form very large multitude.
LICENSE FEE SYSTEM.
In explaining the taxation of railways
and of some other corporations that pay
the sO-called license fee, the Tax Commits
sion on page % of It's first annual report
said: Certain classes of corporations or
persons engaged in quaSi-pubic enterprises
are required to contribute to the public
revenues amounts not measured or appOr-
toned by property valuations, but. usually,
by fixed percentage Of the income pro-
duced from operation of the business en-
gagged in. Generally it is in form a license
fee or charge for the privilege Of con-
Quoting the enterprise. But ordinarily it is
more than mere charge for Il business
privilege or franchise. In most instances
1t is essentially a 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 are something more than "a mere
charge" for a business privilege appears
pretty plainly from the provisions of the
law. Under present statutes, the rate of
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 $4,000 and less than
$1,000 per mile, 312 per cent of gross earn
ings.
On roads earning $4,000 and less than
$1,000 per mile, 3 per cent Of gross earn
ings;
On roads earning $1,000 and less than
$1,000 per mile, the tax is S. per mile and
~ per cent of gross earnings in excess
of 81, 500 per mile;
On roads whose gross earnings are less
than $1,000 per mile the tax is S. per mile.
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 Rail
road Commission. The latter officer is re-
CURED to approve the report made to the
Treasurer before the license can be issued
authorizing the company to continue its
business.
RAILROADS DO NOT ASSESS THEM
SELVES.
1t is often said, generally by those who
wish to uproot the license fee system. that
under this system the railroads assess
themselves. The railroads make returns
annually to the State Of their gross earn.
ing3 and the law of the State does the
rest. The reports are sworn to, and be
fore a license can be issued the Commits
siOner of Railroads must approve the com
panyS report Thus it appears that the re
ports of the railway companies are not
final and conclusive. 1t is not only the
privilege but it is the duty of the Com
missioner of Railroads to review them.
There is never so thorough a scrutiny OF
the ordinary taxpayers schedule as there
Is of the railway company statement OF
its gross earnings. If there were, much
of the property which now escapes taxa
tion would be on the tax roll and this will
be admitted by every candid man.
Railway officials may not be more honest
than other people, but they are surrounded
by conditions which not only enable them
but 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 OWL
stockholders. 1t should be impossible so tC
juggle the figures as to hide anything dis
honest Anything crooked would inevitably
appear on comparison of these different
reports.
How many citizens of Wisconsin Pay
4 per cent. of their gross income for
taxes? All the principal railways pay
pr cent.