The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1909-04-07
TAXATION OF BANK STOCK.
COMPTROLLER GENERAL ISSUES
CIRCULAR ON THE SUBJECT.
Gives County Auditors Full Informa-
tiOn About the Methods for Max.
ing Returns Extended to May 1.

Columbia. April 2.-How banks
and bank stock should be taxed is a
matter that has been giving the coun-
ty auditors trouble for many years,
and recently Comptroller General
Jones has received number of in
quiries along this line Today he sent
out circular letter to the auditors
In which he set forth the method Of
bank taxation. according to the laws
of this State. The time for making
bank returns was extended to May 1,
and in this Governor Ansel noted his
approval.
The letter of Comptroller General
Jones is as follows:
Dear Sir: Answering numerous in
quiries as to the valuation of shares
of bank stock for the purposes of
taxation, beg to advise:
/. All shares of the stockholders
in any bank or banking association,
whether State or national, are to be
listed for taxation by their true value
in money.
2. The words ''true value in
money" shall be construed to mean
and include all surplus or extra
moneys, capital and every species Of
personal property of value owned or
In possession of any such bank.
8. In ascertaining such value Of
bank shares. no deduction is to be
made for the amount of the banks
investments in non-taxable securities,
except investments not exceeding so
per cent fthe capital stock in Brown
consOl bonds and stocks of the State
Of South Carolina, issued under the
Act of 1892. amended by the Act of
1893. 21, Stats. 4S1. The exemption
Is declared by the Legislature to be
a part Of the contract with any in
vestors In such bonds or stocks. But
for this special provision in the Act
of 1893. there would be no authority
for dedcuting the amount Of invest
ments in such bonds and stocks from
the value fthe shares for the pur-
poses OF taxation.
No deduction is to be made Of the
banks investment in any other bonds,
stocks or personal property. BY Sec
tion 1853 of the Code such invest
ment by any bank cannot exceed one
half OF its capital in Brown consol
bonds or stock issued under the Act
of 1892.
The deductions Of real estate own
ed by a bank from the aggregate
value of the shares as assessed for
taxation Is in no sense an exemption,
for the bank Is required to pay the
tax on such real estate. and the
shareholders to pay the tax on the
assessed value OF the shares after de-
Quoting the assessed value of the real
estate. Thus the State is to receive
the taxes on the full value of the
shares. including all property owned
by the bank. The only effect of the
deduction Of real estate is one of
bookkeeping. and it places the tax on
real estate as a charge against the
bank. and the tax on the remaining
value OF the shares Is entered on the
duplicate in the names of the share
holders, but may be paid by the bank.
With the approval Of the governor,
have extended the time within
which the banks may make q correct.
ed or amended return until the 1st
day Of May. 1909.
You should notify all banks in your
county Of this ruling, and give them
a copy of this letter. Then in case
they refuse to correct their returns
within the time limited, proceed
against them for making a false re-
turn and add the penalty of so per
cent. Yours truly.
A. w. JONES, Comptroller General.
I approve of the extension to MAY
I, 1909. for banks to make correct re-
turns.
(Signed) Nj. f. Ansel,
April 2, 1909. Governor
1t Will be noted in Mr.. Jones cir.
cular letter that he does not look with
favor on the exemptions allowed on
bonds. The State Supreme
Court has recently held that the ex-
emption of the new issue of Charles
ton city bonds, from all forms and
classes of taxation. is perfectly valid
and proper, and the holders of these
bonds will no doubt, as q part of their
contract and In cOnsonance with the
decision Of the Supreme Court AMI
Il