The San Francisco call., 1904-08-10
TAX REFORM.

IT HE constitution of California requires 'na' tne
State county and local revenues shall De derived
from general property tax Ihis OF course is IN
tended to include in one assessment an tie Ay anu
personally of the State whether in individual partner
ship or corporate ownership The inequality OF this sys
tenn has long been notorious The burden OF taxation
falls upon realty and such forms OF personally as
live stock and farm implements
Experience of this inequality has led the State Grange
70 an examination of the subject in quest OF remedy
committee was appointed by that body to investigate
and report plan for tax reform. The committee had
the assistance of Professor Pehn of the State Unver
sty whose Investigations and reports upon 'ne economic
features of taxation are accepted texts everywhere
His conclusion that the general property tax wrong
in principle for the that personal property is
easily subject sequesraton and evasion OF assess
ent and the burden should bear put upon realty
To prove this progressive inequality, he shows that
the of personally assessed IN tins State IN 1890
was 16 per cent less the amount assessed in 1872
while in the period the assessment OF realty in
creased two and quarter fold To state it in another
form in 1880 personal property was nearly ~ per cent
of the of the Sate in 1890 1t was only
a little more than IA Per of the total Omitting
from the of both the railroad prop
erty the assessed valuation of the personally of the
State was Fl per in 1880 and in 1890 only IL per
cent of the whole In the seventeen years from 1880
1906 the increase the of realty
cent while the increase in personally was only per
cent.
Not only does this inequality exist, but another ap.
pears in the assessment of realty in cities and in the
country The rea1tv of farmer is assessed from
10 IL per cent higher that is say its true value
than realty in the city.
The conclusion from these and other disclosures OF
investigation shows that equality is impossible
under general property tax. The committee recon-
nends that the derivation of to support the
State government be from another than general
property tax. In this connection the we-known sys
TENS long followed of Connecticut New Jersey, Penn
syvania and Wisconsin are cited In those States there
is no property for the support of the State govern
ments That support is derived entirely from tax, or
license upon corporations and franchises which
exempted from taxation for county and local purposes
This leaves the general property of the State to respond
only for the support of county and local government re-
lieving it from a State tax entirely.
The report of the United States Industrial Commis
sion on the subject of taxation says that in Connecticut
these special taxes exceed the current expenditure of
the State and leave surplus to qudate the State debt
In New Jersey the report says that the derived
from special railroad and canal corporations
riparian lands and the franchise tax miscellaneous
corporations interstate and collateral inheritance
sufficient to defray all State expenses and that the sys
of taxing corporations directly by the State is eff
cient simple certain and economical In Pennsylvania
the taxes for State purposes almost wholly paid by
corporations leaving individuals subject to taxation for
local purposes only except that mortgages, bonds and
other classes of personal property taxable under the
State tax threefourths of which returned to the
ties.
The Grange Committee concludes FIn those States de-
irving their by license or tax on corporations
and exempting such corporations from county, district
township and local tax the system gives good safac
ton to both State and corporations, it requires them
to deal in their with the State alone In
our consideration of the subject fully satisfied
that the system of raising the State by
corporations the easiest farest and most equitable
that has come under consideration, and it also
leves the counties of for State purposes One very
desirable object would be accomplished by it in Calfor-
mia; would do away with equalization of property be-
tween counties, which, under the system adopted by the
State Board of Equalization, is notoriousy unjust"
The report further proposes that the State derive the
$3oooooo required for support of the public schools
by indirect taxation AS the internal of the
Federal Government beer, spirits and tobacco
amounts to over three millions year. there is
why that form of property should not be relieved
from local license and subjected State excise, ade
uuate for the support of the schools
The Grange has made good case, backed by a suf-
ciency of facts and it should formulate the
sary amendment the constitution and get the sub
ect fairly before the people for action by the Legs-
lature.
No longer may Philadelphia be sneered at as the
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