New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1911-07-12
WOULD TAX SECURED DEBTS
DIX IN Messages Urges Passage
of Harte Bill


one million dollars at the ,loss of tho
present fiscal year. according n an .sti-
mstee by the State Controller. For the
last few years expenditures have exceeded
the receipts and those in charge Of the
states finances have been put 20 their wits
ends 10 devise means Of meeting the deficit
Declaring that the situation demands
serious attention, Governor Dix sen; a spe-
cial message to the Legislature to-day rec.
ommending the passage of Senator Harte's
hill providing a tax on secured debts The
measure is in substance an extens.on of he
mortgage recording tax law and it's pas
sage is expected to add materially to the
states revenues.
The Governors message follows:
July II, 1911
To the Legislature
The condition Of the state finances de
lnands serious attention The expenses
have been increasing during the last few
years az the rate of from one 10 three mill
ions per annunl, the appropriations signed
| in 1919 by my predecessor amounting 10
&2,975,ooO This state met large portion Of
it's expenditures by direct taxation down TO
Odell. During his term of office the system
| OF direct taxation was substantially aban-
| doned and a large number OF indirect taxes
were introduced. The last such additional
sources Of revenue TO be introduced were
| the stock transfer tax and the mort ge &c
! tax, introduced in 1905 The indirect taxes
of bout S2.NO,00 the remaining receipts
Of the state being derived from mscella
| neOus sources
In the earlier part Of their existence the
expenditures were much lower and con-
siderable surplus was created For the last
few years. however. the expenditures have
/ leeD In excess of the receipts. not bly, so
this year, the appropriations being, as above
noted. 600. and the estimated receipts
/ s36, 100000 Hitherto tins excess has been
/ paid from the surplus. On September 81
/ last there was q surplus in the general
fund of S,407 49, 81 In view of the appro-
/ priations made by your predecessors and
4 the income above noted. II is estimated by
! the Controller that there will be a cash
/ deficit on September 30 next in excess OF
| 81 100000 The effort made by the last Leg
islature TO increase the revenue from in
/ rates of taxation seems 10 have failed. as
/ the. estimated receipts from that source
VIII he less this year than last By about
( that this loss seems TO be due 10 special
causes
! II does not seem wise to attempt to In
J crease any Of the existing indirect taxes
With "A view, however, of carrying out the
/ policy OF indirect taxation, so far as can
/ he reasonably done without burdening en-
terprise and business. a measure has been
! prepared by The Senate Committee on Tax
alton and Retrenchment and IL now before
you-Senate Dill No. $50 Introductory 9l2
]
use of the state on secured debts. This
/ term is carefully defined to include mort
cages on property outside of the. state;
/ bonds and other evidences Of debt and
practically all forms of taxable securities
/ except commercial papers, which do not
now come under the operation of our mort,
gage recording tax law, Of which this bill
! is I'm substance an extension.
The proposed tax is at fixed rate Of z
per cent upon the face value, like the
mortgage recording tax. The payment OF
Z il
liability 10 local assessment 1t is noto-
rious that this class Of property Is so
easily concealed that il is rarely discov-
cred by the local assessor. The occasions
on which such property is disclosed are
chiefly when 4 passes al death Tor the sup
port. Of widows and orphans. Then the
local rate is so high as 10 take frequently
a third 70 a half or more of the income
And when by some chance such securities
ore placed upon the roll 1t usually happens
that the next wear the owner no longer
has them in his possession. subject to taxa
lion
These conditions have led to many sug
gestions for "A fair specific tax as a substi-
tute for the inequalities and unfair burdens
Of the local assessment Of such personal
property. Where such plan has been
adopted as in our mortgage recording tax
and in similar tax measures i'm other states
the result has always been an increase In
the revenue and i'm the satisfaction IF the
taXpayers. People DO not object TO a fair
end reasonable tax which bears equally on
all but they cannot be blamed for evading
q law so VIGOROUSLY unfair In its operations
as the local taxation of personal property.
Under which a few are caught for heavy
taxes and the vast majority escape
The proposed tax an secured debt VIII
make practically no difference in the local
evenues. but Il is expected 20 provide a
considerable revenue for the state. the pre-
else amount Of which cannot he determined
iu advance. Not only should this tax be
paid voluntarily and IN fact eagerly by tho
holders Of such securities, but ii will also
be paid ny corporations Issuing new bonds.
SO that they will be able 10 market them
freely in our financial centres. As the new
! issues Of bonds amount to some hundreds
Of millions annually In the city Of New
York. the possibilities Of revenue from this
source are obvious.
! 7 therefore recommend the massage OF this
hill JOHN A. DIX.