Evening bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1895-1912, 1908-07-01
TAX ON ENTERPRISE
FOR Profit IS BAD
Commission Report Is
Divided On Old
Question

appointed under the authorization of
the last Legislature. filed its report
with the Governor yesterday after.
noon. The members OF the Commits.
sion are l.. Tenney Peck, Albert +.
Judd and Antoine Perry.
The report is most voluminous
document and covers wide range of
topics. In the preliminary remarks
the Commission calls attention to the
fact that II has been impossible In the
time allotted to go into such large
subject as the question of taxation
thoroughly. On the mainland the tax
commissions are permanent bodies
with much greater authority to com.
testimony than this Commission ell.
Joyed
The Commission is unanimous on all
topics except the Enterprise for
profit tax" The majority believes in
allowing this tax to stand. l.. Tenncy
Peck Is very much opposed to 1t and
sets forth his conclusions In Il twenty.
page typewriter document. He looks
upon the tax as double taxation.
His closing remarks on tax that
has called forth great amount of dis.
cussion follow:
II then our enterprise for profit tax
can only Justify its methods on the
theory that purely personal qualities
of energy and skill and good will
transfer themselves as 1T were from
persons over to inert things and give
them a permanent actual value which
they would not otherwise possess. 1t
would seem to the writer that 1t were
time to abandon Ii as a part of our
revenue system and rely for public
revenue on rational ad valorom assess
ments Of real and personal property
as defined In our statutes, supplement-
cd by our income and inheritance
taxes levied on flexible rates to NEE,
the varying fiscal needs of the govern
ment.
A horse, cart, a harness, are eacl,
worth what they will bring, and their
aggregate value, for purposes Of sale
is not changed by combining the three
in unity of ownership and use ant
under a skilful driver setting the out
fit to work to produce revenue. Eco
nomically considered, the value in use
may be greater than the value ut rest
but whether for purposes Of sale or o
taxation. the aggregate value Is mere
~ the sum of the value of the horse
the cart and the harness separated!
considered. A local violin may b.
worth fifty dollars, yet In combination
with a Kubelik 1t may serve to pro
duce In a concert of one hour a rev
enue of thousand dollars. The art
list departs after adding to his person
al income. but the selling value of tn,
tangible instrument Is unchanged.
A California farm may be worth fift!
dollars an acre. A Burbank buys II
and after five years produces annual,
specialized plants that sell for NOR
than the value of the farm. FL
passes on. but no value has accrue,
to any part of the farm, and at al
times its selling or taxable value re
mains the same. In Hawaii a sugq
plantation hitherto unprofltabl,
changes hands. A new expert ownc
who understands soils, and seed, an
fertilization and irrigation and al
imals and men. and business generally
works in few years through master
full skill wonderful transformation
He may have paid one hundred thol
sand dollars for the property, but a
ter five years is deriving an annua
net income of twenty thousand dollar
from his investment. He may consi,
or himself fortunate II after paying th
income tax on that amount, the who
income is not capitalized say, at eigl
or ten per cent, and the estate al
scssed for two hundred or two hun