Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1905-07-18
DOUBLE I TAXATION.
INTERESTING PAPER READ BY E.
E. M'ELRoY BEFORE STATE
BAR ASSOCIATION.

and Credits Should Be Exempt From
+ Taxation-"some Remedies At
tempted"
The following paper was read yes
terday by e. E. McElroy of this city
before the State Bar association at
Des Moines.
"The subject under discussion is
Should Moneys and Credits Be
Taxed AS Part Of that discussion I
have been assigned the subject, 'Dou-
BILE TaXation-SoLle Remedies At
tempted
John Smith is now 65 years old.
He has worked hard. lived economi-
cally and owns farm we'll stocked
and farming utensils, worth in all
$4,000. That is all he has saved and
all he is worth. He is out of debt and
desired to retire. and,- with is wife,
spend the remainder of his days in
ease and quietness. He only has one
child, daughter, married to an ener-
getic young man of good habits.
Smith and his wife make up their
minds to deed the property to their
daughter and take note and mort
gage for the $4,000, drawing a low
rate Of interest, and then retire. The
deed and mortgage are made and re.
corded. Up to this time the total value
OF all of the property held by both
Smith and his daughter is $4,000, and
is assessed at $4,000 After this
transaction Smith is assessed on the
basis of $4,000, moneys and
credits, and his daughte. with $4,000.
the value of The property she received
from her father. in all $4,000, or
twice the value of their combined
property, although they both are
worth no more after the transaction
than they were before The $4,000
accumulated by Smith cost forty-fve
years of hard work and economy on
the part of both himself and wife
The extra $4,000 now on the assess
or's books cost one hours time and
the expense Of MAXIM; Ind recording
the iced and mortgage. The trouble
is caused by the law and that assess
or treating that note and mortgage as
tangible property when it has no as
sessable value except in so far as that
farm, by virtue of that mortgage gives
it value.
No Increase In Value,
ut is ncnsense to say that when a
farm or other property has been sold
on time, the actual value of The com
bined weaicn or property of the two
parties to the transaction has been in
creased by the amount of the unpaid
purchase money. The fact is, it has
! been increased one cent The
same may be said Of every form of
Indebtedness. If Jones owes Smith,
then Jones, whether the debt is Sc
cured by mortgage or not, has an in.
terest in Smiths property to the ex-
tent Of that debt, and when that debt
is paid jones is simply turning over
to Smith so much of that property or
the proceeds thereof in the payment
Of that DEBT
Moneys and credits are not in a
true sense wealth. They simply rep.
resent the amount of property stand.
ing IL the names of the debtors which
belong to the creditors, or is to be
turned over to the creditors by the
debtors in The payment of their
claims. So when all tangible property
(and by that term l do .lot include
moneys and credits) is assessed for
| taxation, you have assessed all of the
property which constitutes wealth.
Railroad or other bonds and stocks
national bank notes and the like simply
! represent the interest the holders
thereof have in the property of the
corporations issuing them; - that
when all of the property of those com
panies is correctly valued for taxation
purposes and duly assessed, you have
assessed the property of the corpo
ration and so much of the property O
the holders of lie bonds, stock ant
other obligations of the corporation
as are represented thereby. WheI
you have done that there must b.
some good reason for assessing par
of it over again under the head Q
| Moneys and Credits
Should Pay in Proportion.
i Il believe we should contribute t
the support and maintenance of on
government and it's institutions e1
actly in proportion to our wealth. an,
not in proportion to the value Of tn
property we possess. That, think
would be just and equitable an
should be the aim of GU
= law makers in enacting laws O.
taxation If all tax payers when as
: sessed would give to the assessor a
) honest and correct statement of thei
moneys and credits, then I would sa
in making the assessments deduc
} from the value of all tangible prof.
, erty the amount the tax payer owes
in excess of what others owe him, S
: that the assessment against him woul
be on Just what he is worth over an
: above his debts. The trouble is, MOI
eys and credits are easily conceale
and are not honestly given in to tn
: assessor: and the burden of taxatio
!, falls on the honest and these who al
SO unfortunate as to be caught Will
i trying to conceal their property. an
;, the dishonest owners of unassesse
moneys and credits go free. Thus tn
burden of taxation falls on the owner
of tangible property and the hone.
and unfortunate owners of moneys an
credits. They not only have to pa