Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1908-07-30
DOUBLE TAXATION


| The one evil in our present system OF
taxation which Is more condemned than
any other. and probably more than all
| others. Is the so-called double taxation
| feature.
In It's simplest sense double taxation
denotes the taxation of the same person
or the same thing twice for the same
object. This result may he produced in
different ways, which we deem II un-
necessary and Improbable to discuss at
this time. common instance of what
! is generally called double taxation
| whether SO or not. and the most fire.
quently referred to by the taxpayers of
this State, arises In the case Of the real
estate mortgage and more particularly
the farm mortgage.
AS the law now is, the owner OF the
farm is required to pay n tax upon its
assessed value, and the owner Of the
mortgage debt against the farm is also
required to pay tax upon the assessed
value Of such debt, which constitutes
In Il sense his interest in the farm.
| 1t is quite commonly urged that In such
case the borrower IL compelled by the
lender to pay, by way of an Increased
rate of interest, the tax which is assessed
| ~ 'H' I'Ilutr upon inc investment. III Is
doubtful If any question In taxation has
resulted In more controversy than this.
We do not desire to take the space
necessary for It's careful discussion here.
| We express the opinion, however that
the tax on capital loaned Is not, as
claimed by some. universally and en-
tirel- shifted to the borrower. We do
not believe the tax on this sort OF capt.
| Gal
by the borrowers. nor do we believe that
the benefit of a removal or reduction
of the tax would all or chiefly accrue
to the borrower
IT is true. however, that the mortgagor
has no relief from the payment of the
tax upon the full assessed value of his
mortgaged real estate. If he has personal
property. subJec, to Taxation he may.
under our present system. offset such
Indebtedness against his personal prop
erty. II. however, he owes other debts
equal to the value Of his persona. prom
erty, as IL often the case, he does not
In erect receive any benefit because of
his right TO offset the real estate mortg-
age Indebtedness against the assessed
value OF his personal estate.
| 1t Is not strange that the farmer be-
l'eves that he suffers from double tax
alton from which he ought TO be re-
lieved There IS no reason. however why
the farm mortgage should receive any
special prominence In this connection.
except that 1t is most commonly dis
cussed. and We do not suppose there Is n
farUer In this State who would contend
for moment that his mortgage, or that
of his neighbor, should be treated differ
emily from any other real estate mortg-
IaGe.
| THE DEBT ONLY IS TAXED.
| Neither is there any reason why the
mortgage upon either real or personal
property (Which Is merely a security for
debt should be given the prominence It
receives by the average taxpayer when
referring to tho subject of double taxa
ton, except that the popular mind fails
TO discriminate between the debt and
mortgage, II should be borne in mind
that It Is the debt that Is taxed. The
mortgage IS never taxed In this State
The burden of this so-called double taxa
ton Is the same whenever tho borrower
pays taxes on the full assessed value
of the property for which he Is owing.
whether the debt IS or is not secured by
a mortgage.
Neither Is there any logical reason
why We should pause here In the con-
sideration of this subject. II the real
estate owner is TO be relieved from pay
Ing this tax. why should not the own
ers OF other property receive like treat
ment? The merchant borrows money
with which to buy his stock of goods,
or buys 1t on credit. which Is the same
IN effect. The manufacturer conducts his
business In the same manner The stock
of goods or the raw material. except
for the offset privilege, would be tax
able 10 the owner at the full assessed
value. although he might owe largely
| therefor, and the credit in turn would
be taxed to the creditor.
| UNSATISFACTORY REMEDIES.
(a) The exemption of real estate
mortgages from taxation where the rate
Of interest agreed upon Is below a GER
tain arbitrarily fixed per cent.
o. The apportionment of the taxes
on mort gaged real estate between the
mortgagor and mortgage In proportion
to their respective interests; the debt to
be otherwise exempt from taxation.
| We cannot recommend either of these
plans. even II satisfied. and we are not,
..at ..ey would produce the desired re-
suits, because. as already indicated, we
can see no logical difference, for the pur-
poses of taxation, between an indebted
ness secured by real estate or chattel
| mortgage and any other Indebtedness
whether secured or unsecured.
OTHER REMEDIES REJECTED.
| Of but two remedies:
l. Tax only tangible property.
2. Allow offsets to apply to real
as well as personal estate.
We cannot recommend either, believing
the conditions resulting therefrom would
be worse than those now existing.
There are good reasons for imposing a
tax upon Intangible property, and II
seems to us that such property Is equally
bound to pay Its just proportion Of the
| expenses of government. 1t has long
been the policy of this State to tax
this class of property. and We see no
sufficient reason to depart therefrom. The
proportion, and this We believe that
with offsets abolished. with some plan
adopted that will result IN intangibles
paying their fair proportion of taxes.
and probably Of more Importance than
either. with an honest. vigorous enforce
ment Of the tax laws. this evil will be
minimized to degree greater than by
Al