The Montgomery advertiser. [volume] (Montgomery, Ala.) 1885-1982, 1907-04-26
Makes Statement of His
Reasons.
DECLARES NEW LAW
IS JUST ENACTMENT
Says It VIII Not Affect the Interest
Rate.
Asserts That These Corporations HAVE
Not Been Paying Their Propor-
tion OF Expenses OF state
Government

Governor Conner yesterday gave out
an extended statement in answer to
the general criticism of the revenue
act placing the additional tax on for
eisa money lending corporations. In
his statement the Governor maintains
that the law Is a good one and should
be kept on the statute books.
The Governor holds that the criticism
of the act grows out of a misconcep-
tion of the subject. He contends that
the companies have heretofore escaped
their share of the taxation in the
State.
The Governor pays especial attention
to the statement recently made by
President w. p. G. Harding of the
First National Bank of Birmingham. 4
1t will be recalled that more criticism
of the act has come out of Birmingham
than any other portion of the State.
II was commended there that the act
would seriously handicap the Industrial
development of Alabama. because Il
would serve to shut of the lending
of cheap money.
President Harding took this view OF
the act and has come out publicly I'm
opposition to IL. In noticing the posi-
tion of Mr.! Harding and without say
ing so directly, the Governor devotas
a considerable part of his statement
to the answer of the expressions from.
Mr.. Harding.
The Governor compares the making
OF a revenue code to a seining party
as IL is drawing the seine out OF the
pool and says, 'it was necessary to
hold up the cork lines and hold down
the. lead lines to keep the trout and
the other desirable Ash from jumping
over, and watching that no hole oc-
Cured In the net. knowing that II
there was a rent, many would escape
that were desirable TO land"
The statement OF the Governor Ia
full follows:
"The criticism OF the revenue law
taxing foreign loan, companies thin1x
comes from q miscomprehension OF the
subject The foreign loan companies
have hitherto in a large measure es-
capped taxation. why. am not pre-
pared to say. as / cannot see any equity
In the escape.
In making up the revenue laws. the
Ways and Means Committee OF the
House and Senate. In connection with
the Attorney General. the Auditor. the
Governor, and by courtesy Col. Har-
vey Jones. Back Tax Commissioner.
Senator Teasley of Montgomery coun-
ty, and Mr.. Blakey. Back Tax Commits
sioner of Montgomery county. in att
tendance and assisting, there were but
few changes in the old revenue law,
and these changes were made for the
purpose of having parties or properties
that had previously escaped taxation,
pay some share of the burden of the
State.
My principal connection with the
revenue bill was to prevent, as far as
possible, amendments to the bill ex-
tn 49,
their share of the taxes of the State.
1 foresaw that II amendments and
exemptions were allowed this would
enable, as is usual In such cases, large
interests, by special and specious rea-
soning. to have themselves exempted
from paying their share of the taxes
of the State; and 1 liken It unto par
ties SEEMING where the seine had been
run around pool in the creek ana
was being drawn out on the bank, that
1t was. necessary TO hold up the cork
lines and hold down the lead line to
keep the trout and other desirable flsh
from jumping over. and watching that
no hole occurred in the net. knowing
II there was a rent. many would es-
cape that were desirable to land.
History of the Bill.
"As the revenue bill was first pre-
pared, the foreign loan companies do
ing business in as many as thirty-seven
counties of the State were taxed about
9 1-2 mills. BY deducting from this
amount the privilege mortgage tax OF
fifteen cents which the borrower pays.
and the State admission fee, which is
paid but once. the tax assessment on
foreign loan companies doing business
In thirty-seven counties would have
been fixed at about 7 Ia mills.
"As soon as the bill was printed.
-
agents came before the committee ana
before me as Governor, to have the
tax against them removed, protesting
that this tax the borrower would have
to pay and that IL would be an in
cubus on the building and farming
interests of the state. and in the last
analysis, a tax on the borrower. THIS
loan companies through their special
attorneys and agents lobbied against
this bill and secured an amendment to
the bill reducing their tax rate to 1850
of a cent, or LIS of a mill. and the bill
came to me for approval In that shape.
while so far as 1 am concerned,
can easily see that II the rates on mon
ey or anything else were not fixed by
the law of supply and demand, and
there was no competition in It, and the
foreign money lenders were simply
acting the part of the Good Samari>
they could lend money cheap, their
position would be right. But money Is
not lent nor business done that way.
When you consider that 1-50 of a cent
or is of a mill is simply a tax OF $50
on 100000, or $500 tax on $1,000.0oO.
l thought then and I think now, that
is Is simply absurd, and 1 amended ths
bill to it's present shape, which was
passed and became a law.
THE law as II now stands, imposes
a four mill tax on foreign lenders
lending out 100000; a two mill tax
on one lending 100000; one and three
quarter mill tax on ono lending ST.
900 coo This does not include the en-
trance fee. which is paid but once. and
the fifteen cents privilege tax which
the borrower pays and has always
paid. The tax then amounts in net
figures to 40 OF a cent; LIS OF a cent:
and is OF a cent on the amounts as
sfatad N ofhar words ~ the