The Birmingham age-herald., 1907-04-26
A|abamians Should NOt Be Com. peIsd to Pay Higher Tax
 Rate Than Outsiders
COMPETITION SHOULD
 REGULATE INTEREST
Loan Companies Are Not Doing 5usi ness for charty-Cites Interest Charged by First National
 Bank of Birmingham.

Montgomery April 25.-(Special)-Gov' ernor Conner has given out a statement in which he defends the tax on foreign money lending corporations holding that it is not excessive. He contends that with the tax at one-fifth of one per cent they would have paid nothing to speak of and he is of the opinion that there Is nothing in the law to condemn. Here Is the governors statement in full:
 ''The criticism of the revenue law tax ing foreign loan companies I think comes from miscomprehenson of the subject The foreign loan companies have hitherto in a large measure escaped taxation. Why, I am not prepared to say, as 1 cannot see any equity in the escape.
 Tn making up the revenue laws, the ways and means committee of the house and senate in connection with the attor- ney general, the auditor and the governor and by courtesy, Col. Harvey l.. Jones, back tax commissioner, Senator reasley of Montgomery county and NJ. Blakey. back tax commissioner oi Montgomery county in attendance and assisting. There were but few changes in tho old revenue law, and these changes were made for the purpose of having parties pr prop critics that had previously escaped taxa ton, pay some share of the burden of the state. My principal connection with the revenue bill was to preYenti as far as possible. amendments fo the bin eA sempting special interests from paying their share of the taxes or the state. foresaw that If Amendments and exenp- tions were allowed this would enable, as Is usual in such cases. large interests by ,f,1 n themselves exempted from paying their share of the taxes of the state; and | liken it unto parties out sening where the seine had been run around q pool in the creek and was being drawn out on the bank, that it was necessary to hold up the cork lines and hold down the dead line to keep the trout and other de- sirable fish from jumping over, and watching that no hole occurred in the net, knowing that if there was a rent many would escape that were desirable to land.
 Wanted Tax Removed.
 "As the revenue bill was first prepared, the foreign loan companies doing busl- ness in as many as thirty-seven coun- ties of the state were taxed about 9ia mills. By deducting from this amount tho privilege mortgage tax of l5 cents which the borrower pays. the state admission fee. which Is paid but once, the tax as- sessmcnt on foreign loan companies do- ing business in thirty-seven counties would have been fixed at about 7h mills. As soon as the bill was printed. quite d number of the foreign loan agents came before the committee and before me as governor, to have the tax against them removed protesting that this tax the bor- rower would have to pay and that 1t would be an incubus on the building and farming interests of the state, and in the last analysis. tax on the borrower. The loan companies through their special attorneys and agent lobbied against this bill and secured an amendment 10 the bill reducing their tax rate to 1-50 of a cent, or 1-5 of a mill, and the bill came down to me for approval in that shape.
 While so far I am concerned, l can easily see that if the rates on money or anything else were not fixed by the law of supply and demand, and there was no competition in 1t, and the foreign money lenders were simply acting the part of ths Good Samaritan" hunting places and people where they could lend money cheaI. their position would be right. But morey Is not lent nor business done that -"av
 Had the Law Changed.
 When you consider that 1-50 of q cent. of 1-5 of a mill is simply a tax of SEQ on s100,000 or S200 tax on $l,0o0.00O, I thought then. and think now, that 1t Is simply absurd, and I amended the bill to its present shape. which was passed and became law. The law, as 1t now stands. imposes mill tax on foreign lenders lending out si0o,O00; a mill tax on one lending $500. 900; 1A mill tax on one lending s1 900, 000 This does not include the en- trance fee, which Is paid but once, and the 15 cents privilege tax. which the borrower pays and has always paid. The tax then amounts in net figures to 4-10 of cent. 1f ar.d ~f A.f lx amounts as above stated. In other words. If the borrower was paying per cent be- fore this bill was passed If he paid tha full tax he would pay 64-10 to a com pany lending $100.0o0; 1-5 to a company lending t50o,o0O and 61-s to company lending 100000. Any advance In money rates to borrowers above the figures quot ed is not caused by the new revenue bill.
 Why It Was Done.
 ''The tax rate on my farms in Barbour county Is Is mills, or $l6Oo on $10000o. Now why should I, a farmer. or any other farmer be required to pay $500 on $100.o00 value as our contribution to help carry the burden of the state. and the foreign money lender be required to pay only S2c on the same amount? Why should the banks of Montgomery be required to pay s2500 tax on s100.O00. as they are, and the foreign money lenders be required to pay only s20 on the same sum? You say if you do not tax the money lender he will lend money cheap. For the same reasons if you do not tax the home banks they will lend money cheaper: if you do not tax the farmer he will sell his produce cheaper; If you do not tax the railroads they will carry freight and passengers cheaper. In fact. you could carry this all the way through and bring 1t to where no busi- ness should be taxed simply because you make prices higher. It Is stated by those