The Bridgeport evening farmer., 1909-05-17
REPORT ON TAXATION IN
 CONNECTICUT

(Continued from First Page.) efforts to reach this corporate excess in e the hands of the shareholders through local officials. Massachusetts from this source; the other five States very little.
 Banks, insurance companies and other financial corporations pay large amounts, often exceeding the tax paid by railroads, but they do not come within the scope of this report, except in the comparison of financial results.
 Maine alone of the New England States secures large revenue by char tering corporations-nearly a quarter of a million dollars annually.
 New England has made consider able advance in separating the sources of State from local revenue, supporting the local jurisdictions through the tax upon local property. and the State government by taxes upon corporations and inheritanceS. Vermont and Con Eecticut are the only States which thus pay practically all State expenses. In the other States the towns collect large amounts to turn over to the State"
 In his special reference to Connectf- cuS the commissioner says:
 "Over four-fifths of the total reve- nue for State purposes in Connecticut comes from State taxation of corpora tions. In 1908 the total State expenses were nearly three and half million dollars, of which the corporations do-
 
 ed nearly three millions; and of this three millions the railroads paid over a million, savings banks over half a million, and insurance companies over half a million.
 Since the suspension in 1890 of the State tax on real and personal prop erty, there has been a complete separ- ation of the sources of State and local revenue. One of the methods pro. posed for supplying an increase of State revenue is the re-enacting of the State general-property tax.
 Another method proposed for in creasing the State income is to tax the corporate excess of manufacturing and mercantile corporations. Such corpo- rations, sometimes referred to as gen. eral business corporations, are at pres ent taxed locally on property in the same manner as individuals. and there fore pay little, if anything, directly to the State.
 .'In an address before the Farmers Association of the Legislature on March 10, 1909, MT. Corbin, State Tax Commissioner, said:
 '''The value of the shares of the
 capital stock and the indebtedness
 represents the fair value of the
 property, tangible and intangible,
 of every solvent corporation.
 "'When a corporation is taxed on
 its property in the same manner as
 individuals, the aggregate value Of
 the various assessment schedules
 may fall far below the value of the
 entire business plant or enterprise
 of such corporation considered as
 unit and measured by the aggre-
 gate value of it's bonds and shares
 of stock On the theory that every
 element or factor which gives to
 corporation a value for income or
 sale should be considered in fixing
 the taxable value, this unassessed
 residuum may be reached by a tax
 which is generally termed the tax
 on "cOrnOrate excess"
 A list of eighteen corporations
 of this State selected at random,
 nearly all from two cities, showed
 the bid value of the stock as given
 by the local brokers on October l,
 1908. as $35 ,250, while the as- porations by the local assessors was
 $12746, 361. This shows "corpor-
 ate-excess' valuation of over twen-
 ty-three millions of dollars, not in-
 cluding any bonded indebtedness.
 The aggregate of such excess val
 uation of all similar corporations
 throughout the State which now
 escapes taxation must be very
 large
 This recommendation means that rations would be taxed in the same way in which Connecticut, now taxes her railroads. Indeed, the inclusion of the bonded indebtedness as part of the taxable value of a railroad conn pany is unique, and is often referred to as the Connecticut method.'
 Another unique feature of Connec- ticut'S system of taxation, not eSpec- ially of corporations, is the so-called 'chose-in-action' tax, by which holders action can pay to the State a low uni form rate of $4 a thousand instead of the regular local property tax of about s2O"