The Montgomery advertiser., 1905-06-11
AN IMroRrANr prCrsloN.

Since the Supreme Court of the United States has decided that State has the right to impose special taxes on franchises. there has been wide dis- cussion in the newspapers on the sub ject. The case went up from the State of New York which passed a law while Roosevelt was governor to authorize the taxation of franchises, other than the tax on the actual value of the prop erty.
 Naturally the corporations of New York fought the law. They fought 1t through all the State courts and finally got a case before the Supreme Court of the United States, and that tribunal has decided against them, and we pre- sune that no further litigation can be had, though we are not sure of it, for a corporation has many lives and can re- sort to many devices to protect itself. and the amount involved in the New York case Is said to be about twenty six million dollars, Including interest and penalties. It is a sum we'll worth contending for, and if there can be SAO0huc lAoh AuftuCE COHtCohB w may feel sure that advantage will be taken of them and the fight kept up
 That there will be strong arguments against the enactment and enforcement of law of this kind Is not to be doubt ed. but there Is much in its favor is equally true. That public franchises are greatly undervaIued is a well known fact. That they are granted by cities without fair consideration is equally true. In some cases city will give the use of its streets or public grounds, and in many other instances the price paid to the city is merely a nominal one. It iS only very recently that cities are realizing the value of such privileges and charging something their worth.
 When 1t comes to taxing franchises the disparity between valuation and assessment is much greater, A street car franchise. for example, may be act uaiiy worth one million dollars to the owners. but all it's property of every kind may be worth only one hundred thousand, and that Is the amount on which taxes are paid, even if the act ual. tangible property is assessed at it's tul1 value, which Is not often done. The value of such franchise depends on It's earning capacity and not on the it actually owns.
 Now, the question in dispute turns | ,n the right of a State to tax such a .ornorafa hodv accnrdin0 fo ifa actual | value as an investment, or only accord | ng to the actual value of visible prop | ,rty. The difference between these val | nations is plainly shown in New York. | 1t is presumed that all the contesting | have paid taxes on the | md cannot easily escape the assessors, | md that the large sum mentioned as | tue has been assessed on what 1t is considered that the franchises are real | y worth. That the question Is an im- portant one is not to be doubted. The | Portland oregonian. arguing for such ! law in that State. says that these offer a means of raising | revenue which will tend to equaliza- tion of taxes. give relief to real estate | and cause rich people who have been | their wealth and constantly | rolling 1t up. while paying little or for support of the operations | ,f government, to bear their fair share | If the public obligations"
 We can well understand that strong opposition to such laws may be ex- ,ected. It will be contended that 1t Will be double taxation. and other grounds of resistance will be resorted o, but the question that most people will ask will be. is such taxation just? t we admit that it is an equitable and air method of raising revenue, then all ,ther considerations may be disregard d, as the main object of all revenue avs should be to raise sufficient money without injustice to any person or bus ness. The New York case will be with interest.