The citizen. [volume] (Berea, Ky.) 1899-1958, 1911-01-12
TAX SYSTEM
NEEDS REVISION
Address OF A. Y. Ford TO the
Members OF Kentucky
Press Association.
PRESENT MODE COSTS HEAVILY
Tax Revision Does Not Mean esemp.
ton, eut Fair Apportionment on
All Kinds OF Property-it
Means MATERNITY.

Louisville The following Is the adj.
dress of Mr.. A. Y. Ford before the
Kentucky Press association at the
mid.win,er gathering In Louisville:
The tax system Of a state deserves
careful consideration, because the
power 20 tax is the power TO destroy,
and n tax unwisely laid may easily
drain the hfe OF community or Kill
an industry. Approximately $50, 0OO,-
400 a year are taken from The pockets
Of the people OF Kentucky for the sup
port Of the state. county and munich
pal governments. II is Incompetent.
sible that a thing which means so
much In dollars and cents TO the PEG
pie of the state should generally have
received such sCant consideration.
There has been no considerable OK.
trayaganc" In the expenditure Of our
public funds. u IL therefore time tina,
We now stop to consider carefully
whether these large sums are raised
by tho best possible methods, whether
they are raised In way that distrib-
utos the burden fairly as between the
owners OF various kinds Of property.
whether the lax laws impose the least
burden consistent with the demand
Tor revenue. and whether hey so dis
tribute tho burden as 70 o'fer the least
possible hindrance TO the development
Of the state Where there IL cOmpe-
tition between communities such as
necessarily exists under modern con
dltiOns. an unwise system NAV, In
sharp competition for new population.
new industries and new capital. easily
prove destructive Of prosperity.
Revision Does Not Mean exemption
The movement for revision % tho tax
system uf Kentucky H. not = movement
IA favor ~ exemption 81 any KIND ~
property frosn f7vatton. 7 know 70 Fli
10, n characterized IN some quarters re
onl' rs an apr"al Tor an 'Nrmn,inn y
capital tom taxation. There has re-
Gently appstred ~ The prcss ~ the state
an art iclr from gentleman for whom !
have she greatest respect which reNea. :
= total Misunderstanding 81 the spirit
and purpose ~ this movement. In this
srticlc II ~ declared that the attempt -
rrViso thu system % taxation IN Ken
lucky g. part ~ \ ycnet-i combination
81 capital 10 Srcure exemption from taN-
aticr. I state deliberately. and with fu'l
,Un~ids ration, and having abundant on
porfuuity 10 know whereof I speak that
no advocat" Of the proposed revision "
the tax system ~ Kentucky has ever
~tCgrrted that any class OF property
should h. exempted from taxation
The purpose % the movement for tax
revision Il not 20 secure exemption for
any class - property. ON the contrary.
tutional restrictions 50 that the iegtsla-
rurc may have power 80 20 vary the
method ard the rate that millions OF dol
lars % property that now escape taxa.
fiou may b. made to yield n revenue and
thus relieve the burden on real estate.
our present system has utterly failed IN
this respect After nineteen years ~
trial W. iinl " has practically broken
down, 50 far M concerns the raising o.
revenue from stocks aud bonds and other
property of that intangible kind which
can en- SHY h. hidden.
shan We merely keep on with the old
system that has failed. or shall We make
ourselves free To- try methods that have
succeeded elsewhere IN deriving large
revenue from this Kind 81 property which
escapes IN our stateH ! make no appeal
for the tax dodGer | favor no exemption
~ any Kind Of PROPERTY ] advocate a
system that will make every kind Of
property bear fair share - the burdens
rated according to its capacity and col
icctcd by q method iittcd 10 its character.
Facts and Not Theories
Theoretically. under our present law.
NJ property Is exempt Practically. 'un-
dor orr present law. millions upon mil
bonds for Instance were taxed In Ken
lucky this year. That IL manifest alb
surdity let us address ourselves 10 the
facts Let as face the conditions as they
arctic laws OF economics and of human
nature n they are-and not as We think
they should be.
The system Of taxation we have In
Kentucky H. what & known as the Gen
.ral Property Tax System. II Is n sys-
TEN which came into existence many
years ago when property existed In slim
would be m shape OF lands and houses
aud live stock. or stock ~ goods, or
other things visible tn the eye and easily
assessed. In that day II served It's pur-
nose fairy well. but that day has been
long outgrown and the system which SUI
iced then ~ now being generally aban-
doncd because II has been found impossi-
BILE 90 adnpt N TO the many new forms or
pronerty which have come into existence
with the tremendous Industrial and COM
mercial development Of recent years. We
have now manifold forms u property
that were not even dreamed OF az the
time the general property tax came into
favor The development OF the corpora
ton With the varied forms OF property
tributton OF securities has entirely
changed the complexion o. affairs.
4 system Of taxation which could de-
rive revenue from lands and houses and
other kinds Of visible property. which
are liked. nailed down, and unable To
escapr. II by no means lifted TO derive q
revenue from bonds and stocks and
moneys and other forms OF intangible
uErsunal property. like bonds and stocks
aud money and notes, which can hide
and will hide whenever the tax rate
becomes high enough to take what the
owner 81 the property regards AZ too
large proportion OF the Income from
that property.
The Gao Widens.
Even IN the earlier days OF corporate
deVplopment the misiit was not quite so
bad as n Is to-day. Year 10y year, how
ever bonds and stocks and notes and
other froms of intangible personal prop
erty represent "A larger and larger per-
centage of the total property OF the COM
punty. Year by year, at the same time,
Che demands for revenue for public pur-
poses. such as good roads. good schools.
etc, bssome heavier and the tax rate
goes higher and higher At the same
lime tho yield from bonds and stocks has
grown smaller and smaller. In earlier
DAYS railroads thought nothing. for In
stance. of issuing per cent bonds. To-
day ANY standard railroad would con-
Fider Itself disgraced In the matter OF
credit n Il could not float its bonds at 4
per cent or less. The inevitable result
81 these changing conditions-with the