Daily Kennebec journal., 1908-12-19

by what process of reasoning one comes
to the conclusion that steam railroad
should be taxed or a percentage of gross
transportation earnings per mile, and an
electric lighting company on it's physi-
,al valte-and we may say the same as
% telephone and gas companies and the
;ame as to express and water companies.
All OF these corporations are created by
Legislative authority and are engaged in
erving the public.
At the present time the State receives
4 revenue from State tax on the fran
'hise of steam end electric railroads,
telephone and telegraph companies, eX-
'ress companies, parlor and sleeping car
'omnanfes.-whil gas, water. electric
lighting: heating and power companies
municipalities within which their prop
rites lie. Additional to the franchise tax
evied bv the State, the aforementioned
companies pay local taxes on all their
cal estate in the case of railroads this
being defined as all buildings whether
within or without the located right Of
| way. and lands and fixtures outside of
he located right of way
Railroads.
The amount of State tax, assessed
against steam and street railroads Is
determined by the amount of gross trans,
oOrtation earnings taxed al fixed and
arbitrary rates.
In the case of steam roads the rate
annot exceed four and one-half per cent.
f the gross transportation "afnlags,
while with the street roads there Is no
wentieths of one per cent. Tor each ad.
| litional one thousand dollars increase of
earnings per mile.
There is no cxDlci: provision in the
Statute authorizing local tax on the
Marine Equipment of Railroads. and we
ind upon investigation that no par, ol
operated hv n Maine railroad go to
1ake up tie gross TRANSFORMATION earn
nes uron which they ar taxed,
The shares of the caritaI stock of such
uiec 1t by law eSDnDt from all
.axation but there ie no such provision
is to their steamboats,. we can see no
The stea,nhoat business th"v should not
1ay the same tax on their boats as other
owners of like property.
Nor lIas it heen made plain to US why
.treet roads ere taxed at different rate
than steam roads. Under the present
law there is a great and uncNnlainanl nle
DISPARITY. II the present Hethoi or as
sessins these properties is to be retained
we recommend that the same rate Is
made applicable to the steam and cleo
tric roads.
Telephone and Telegraph Companies
The State Tax On a Telephone or 'rele-
graph ComDan" is in lieu OF all taxes
upon its shares of capital stock and its
property used in the conduct or us teie-
,hone or telegraph business: including the
poles. wires, insulators. office furniture;
,atterieS. instruments, telesraphlc ana
-elephonic apparatus. telephones ana
'ransmitters" owned or leased. Ordinary
cal estate owned by such corporations is
subject TO local taxation in the municl,
,ality where it lies. but the amount pald
Nv the corporation for local taxation is
deducted from the amount OF the State
telephone and telegraph companies. and
have no doubt that the Legislature Will
eneal the provision relating thereto.
The rate of telephone and telegraph
LOGO to 5000 dollars: it increases one
1uarter of one per cent. if earnings ex-
'eed 5000 and do not exceed 10000 dollars:
hen the rate remains the same for such
-on,panies as have earnings in excess OF
0000. but rot in excess OF 2oooo doilaIiS,;
ofter that the rate increases only Win
rach increase of 25, 900 dollars of earnings.
m the case of steam roads the rate m
rreases with each increase of 500 dollars
# earnings per mile, and with electrlc
roads with each increase of thousand
dollars of earnings per mile, while with
telephone and telegraph companies the
ate does not progress with each increase
ro reason for this difference in principle
IF increased earnings of 5000 dollars ar"
20 form a basis for the first increase IN
he rate of tax on telephGdne t and he ,a,t. rato
,re increased with each further increase
# 5000 dollars of earnings? rms IS
natter that should. in our Judgment be
corrected if the present system is to be
Another thing to which we wish to cali
the attention Of the legislature is the
act tTftl lPHbiN'llt' dlttI tCiSe' am
-anies pay tax on receints only iron
Nusiness done wholly within the state
Tho exclusion Of Names proportiorate
,r,ount of interstate business from the
taxable amount of earnings of inter-
state telephone and TELEGRAPH companies
's illogical and unsound. 1t is a wei
"ncoenized fact. that the long s;as alStahf, ;s
the most profitable mart of their business
md they can well afford to nay fav
mon all tolls received. providad Ine S.h.a
the property and business of such COM
DanieS.
Express Companies.
Express companies are assessed an an
nlal State tax equal to two and one.hal
per cent. of their gross receipts from
business done wholly within the State
including a proportional part of all eN-
press business coming to or gong from
derived from express matter IN trahslt
through the State. The real estate OF
such companies is taxed locally. but the
amount paid to municipalities on such
real estate AS is used in the business is
deducted from the amount of the state
tax Here is another rebate which should
be abolished.
Parlor and Sleeping Car Companies.
Companies operating parlor and Sleep
ing cars pay State, tax equal to four
from business done wholly within the
State-the State receiving no part or
Interstate business lney pay no locdi
tax except on real eXtate
1t will be noticed that the tax on the
two st-mentioned businesses is not
what is called a graduated tax that is
the rate is fixed and remains station
ary, regardless of their earning power.
We are as much at loss to understand
this as we are to understand way the
State should reimburse certain public
service corporations for the amount paid
for local taxes on real estate and not
reimburse others. Neither can we un-
derstand why the stock of railroads, tele-
phone and telegraph companies should be
while tho stock of express and pailor car
is apparently taxable Nor do
we understand why one rate should be
applicable to one class and not to the
other.
Our recommendation therefore. is. that
for the present system be substituted one
that can be defended as logical equitable
and consistent. system whereby the
value of the property instead of it's earn
ings shall be the basis of taxation.
II in truth the railroads. telephone
and telegraph, express, parlor and Sleep |
ing car companies cannot pay a tax equal
at least to the average rate of taxation OF
all property throughout the State. we
have no doubt the Legislature in its Wis
dom will fix Il lower rate. Maine lIeglSla-
lures In the past have shown no incllna-
ton to levy too burdensome tax on any
public service corporation. AT the present
time few of our citizens can tell the rate
70 htTl