Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1905-03-09

1
of the State of Maine by the increase
of taxation upon steam railroads in this
State the sum Of $225,0OO
This may seem to yOC at the first
blush a very large amount or money.
| Indeed it is. But you must consider
| that it involves a very large amount Of
Icapital and assets owned within the
| State of Maine, or controlled within the
State Of Maine, and doing business here
| to be taxed. nearly one hundred mill
lions of dollars worth of railroad prop
| erty within the State of Maine, Now,
one of the first and most important
principles to be considered is the reve-
| hue of the State. How is that revenue
to be raised? You will all answer, by
taxation. But upon what shall that tax
| be levied. how shall it be levied, and
what amount shall b. LEVIED upon the
various kinds of property in the State
of Maine" The general idea of taxation
| is that the tax shall be assessed upon
property; and our constitution provides
tfat all property within the State of
Maine shall bear its fair and equal and
just rate of taxation. Upon all
real estate, upon our personal prop
| erty. generally speaking, the tax
| is assessed according to it's value.
| A different rule prevails in relation
| to the taxation of railroads. and
for two reasons, ard | think it is
| generally admitted by learned fnanci-
erS and writer's upon economies that
the best method of taxing railroads is
by taxing them upon their gross re-
| celpts. -Four years ago in this very hall
| | heard President futile. President OF
the Boston & Maine. President OF the
| Maine Central. President of the WASH
inSton County Railroad, say that he
believed that the method Of taxation
adopted by our STATE upon railroads
was the best yet devised. Now, the
present bill does not change the method
of taxation in the least. 1t simply
changes the rate of taxation upon the
gross income of the road. If you will
look at the table which has been plac-
ed upon your desks You will see that
| the reading is as follows: THE fol-
| lowing table shows the gross assets of
| each railroad operated in the State of
| Maine, gross transportation receipts in
Maine the gross transportation re-
ceipts per mile, the proposed rate of
| taxation. the proposed tax. the present
rate Of taxation. the present tax. the in
| crease of tax under the proposed bill
aud the amount of tax each road would
pay on the basis of valuation based up
on average rate paid by other property
assessed in the State Of Maine"
| l call your attention to the healing of
this table. All railroads not earning in
excess of $500 gross transportation re-
ceipts per mile pay five mills on the dol
| lar of their gross transportation receipts
| in lieu of all other taxes payable into
| the treasury. except that their real es-
tate is taxed in the localities where the
| same is situated and taxed the same as
other real estate. This tax, under the
present law and under the proposed BILL
| is what is called an excise tax. Now.
| hen they earn more than Sl.f0 gross
| transportation receipts per mile they are
| taxed under the present law. and not
| exceeding 5000. three fOurths of one per
cent. upon their gross transportation re-
ceipts and that rate is increased one
fourth of one per cent. as the gross
earnings per mile increase each 500;
that at $1,000 they pay thrce-fourths of
one per cent. at $500 gross Transporter
ton receipts per mile they pay one per
lcent of the gross transportation receipts.
Therefore, | have made this table, | have
made it with a great deal of care and II
great deal of study. and first I have
given the gross assets of each railroad.
Then divide their gross assets-and that
is the provision of the statute as it now
eXists-by the entire number of miles OPP
Grated. which gives the gross earnings
per mile, and multiply that by the num-
Der of miles in Maine gives the amount
| upon which the tax is assessed in the
| State of Maine. For instance, you may
take the Bangor & ArOostook Railroad.
| the first in the list. Their gross assets
are S1i.OOO,0OG in round numbers. Their
gross transportation receipts are s1,6S6M0.
Their gross transportation receipts per
mile arrived at by dividing the s1.GS6.0OO
by the number of miles operated, gives
s345lll. That is their gross transporta-
ton receipts per mile When you get
their gross transportation receipts per
mile then you determine the rate as first
stated what their rate of taxation will
be- For instance. at s3951 under the
present rate If taxation their taxes would
be- as you will see under the heading Of
| present rate" OILS per cent. Of their
gross transportation receipts. You multi
ply their gross nSpOTtdtlon receipts Dy
that number and it gives you their pres
| ent tax. S2?5l5.sS. Now. under the pro
posed bill 7 start with the same sum, $500
rs the starting point. Why is that? 1t
| is because it is believed, and | think ac
knoWledged by all, that a small road.
new road. earning but little. and being
| a sort of a public institution in a way,
a quasi public corporation. it being Of adj
| vantage to the State to have these rail-
roads sustained and maintained. instead
of taxing them upon the value of their
property they tax them upon the ability
that tho several roads have to pay taxes.
In other words. instead of taxing. them
upon the amount of money that has been
invested they tax them upon their abili-
ty to pay taxes. Their earning capacity
Now. what does thar mean? Perhaps
7 can illustrate it better by an example
Suppose there are two mon. They start
out rs young men together. one man
has a capacity and an ability to earn s.
or Sc per day. The other one common
laborer. with no such ability. earns 81
a day or s.. Now the man who earns
.