The evening times. [volume] (Grand Forks, N.D.) 1906-1914, 1909-07-08
M'vEY TALKS
ON INTANGIBLE
PROPERTY TAX
Suggests the Remedy for Tax
Dodging by Moneys and
Securities
SUCH TAXATION SHOULD Be
ACCORDING TO THE INCOME


ret or Drastic Penalty Feature
Tax Upon Average Bank Depostts ;!
Mlnot. N. D., July s.-The North
i'akota Bankers association convened
III annual session this morning in
Mlhot with large attendance of
bankers from all sections of the state
lie sessions premise to be intensely
interesting throughout as the pro-
gram that has been arransed is filled
! WIN good numbers.
ne morning was taken up with
.he reports OF the various officers and
'ile transaction of such other busi-
ness as came regularly before the con-
Neileioh. lhe afternoon was taken
/ up with several addresses by prom-
l!ieh' speakers, notable among these
addfesses being one by President
Frank l.. McVey of the North Dakota
university who spoke on The Tax
alton of Intangible Property" A
summary of this address follows:
Intangible forms of propertv ara
the bosies of the assessor. They
might be defined as something that
is supposed to exist but has never
been seen by the mortal eye of the
assessor The interest of bankers in
the taxation of what are termed in
tangible forms of property is greater,
perhaps. than that of any group of
cltlZens since they are supposed to
be the keepers in a large degree of
such property. Under the present
form OF the general property tax the
results Of taxing intangible property
nave been anything but encouraging.
The statistics from various states
| show that there has been, with the
increase of stocks and bonds, credits
and moneys, decline in the amount
actually assessed as stated on the
property lists. North Dakota is dis
! tnctly an agricultural state and much
or the personal property in this state
is in tangible forms. but there is.
nevertheless. large amount of such
property as shown in the statistics
OF the banks and Of the ownership of
stocks and bonds. The future. there
1 fore. will bring up the question in
this state. as it has in other states,
OF what to do regarding its taxation.
Three Attitudes.
There are three attitudes toward
the taxation of personal property. One
group of persons call upon the legis-
latllre to pass laws with drastic pen
alties and demand that the officers
snail enforce the present law. They
even go so far as to encourage the
creation of a ferret system for the
purpose OF ascertaining by stealth the
facts regarding the possession of per-
Ohio and elsewhere have clearly
shown that this method. instead of
| increasing the amount of personal
F., property on the tax roll. tends actual
| lE to lessen it. Ohio passed a law so
drastic in its character that little
could he found in legislation, even
as far back as Roman times. that was
more energetic in its penalties and
yet Ohio is famous for the inefficiency
OF her personal property tax.
a second group of persons demand
the exemption Of personal property
| from all taxation. saying that the
taxes are paid indirectly and that un-
der the present system a tribe of liars
and periurers is created. They point
to the fact that the taxation of mort
CAGES. moneys and credits increase in
terest rates wherever they are levied
and therefore ask for the complete
exemption of all personal property.
Ey Gradual Steps.
Reform. however. does not proceed
so rapidly. 1t is only by gradual steps
that the general property tax can be
modified. and We. therefore. turn with
some relief to what has been termed
compromise plan. This plan recog-
nizes some of the elements of both of
the other groups. In the first place
1T recognizes that personal property
ought to be taxed and in the second
place it recognizes that 1t ought to be
taxed in relation to its income rather
than its value. The efficiency of the
plan based upon this policy has been
we'll demonstrated in Pennsylvania
and Maryland. In the first state more
than billion dollars of personal prop
erty in the form OF securities, stocks
! and bonds have been added to the tax
the comparatively short period of six
years more than one hundred fifty mill
lions of dollars was placed upon the
personal tax lists that would other
| wise have escaped when the rate of
taxation was reduced In fact, the
failure to tax successfully personal
property in the form of moneys in
vested has been largely due to the
heavy rate levied against it rather
than in the fact that it was taxed
at all. and recognition of this situation
by the establishment Of small rate
of three or four mills on the value
of the property results in feeling
of fairness on the part of the owner
of such securities.
Mortgage Registry Tax.
'The same idea has been carried
still further in the instance of the
taxation OF mortgages. In some of our
states. notably New York and Mime.