The log cabin Democrat., 1912-08-03
RESULT OF THE
 BACK TAX SUITS INSURANCE COMPANIES MAY LEAVE ARKANSAS RATH- FER THAN PAY BACK
 TAXES.


 the insurance men of the state are in timating that many of the companies now doing business here will leave the state on account of the back tax suits that have been brought.
 Suits have been brought at the in- stlgation of the attorney general for the collection of back taxes from va- rious kinds of corporations, amount ing to $6,493, ,429.57, and for the col letion of penalties for violation of the antitrust law amounting to about S5,OOO, O,OOO, making eleven and one half million dollars which the state is asking the corporations to pay.
 "The act of 1873, passed by legis- lature composed largely of negroes, has been repealed by law, custom, usage and decency," declared Ashley Cockrill, counsel for a number of the companies that have been sued. "The companies have paid every cent of tax charged against them, annually, by the state auditor, and it comes with poor grace for the state to come in at this late date and allege that it has been fraudulently deprived of any tax on the part of the insurance companies. For 37 years no attorney general or insurance commissioner has attempted to collect that so-called privilege tax under the act of 1873, which was clearly repealed by the act of 1875. It is interesting to note in this connection that the special attor- neys in the cases gets 20 per cent of the amount recovered.
 "This sort of thing hurts the state immeasureably, and it will take 20 years to recover from every such blow"
 Assistant Attorney General Rector said: "The state has a good case. The act of 1873 providing for priv ilege tax based on the receipts has never been repealed But the state will try it's case in the courts and not in the newspapers"
 The insurance companies pay an- nually privilege or franchise tax of $20O under the act of 1911, also pay fee for fling their charters, and S5 for each license issued an agent. If they own mortgages or bonds in the state, these are assessed in the usual way
 L. B. Leigh, one of the oldest and best known insurance men of the state, says: "The act under which these suits were brought was enacted by the last carpet-bag legislature that ever assembled in Arkansas. was living in Little Rock in 1873 employed as clerk in the insurance office of Pagan & Trezevant, and re. member much of interest about the condition of things in this state at that time.
 "The state was running on a scrip basis and finances were at very low ebb, state scrip selling at about 30 cents on the dollar and county scrip much lower, Pulaski county scrip falling as low at one time as 12 cents on the dollar. Lucien J. Barnes, a Little Rock insurance agent, was in- surance commissioner and was the reputed author of the new act, which, among other things, provided that the insurance companies should pay the salary and expense of the insu- rance commissioners office.
 "Prior to that time the insurance companies had paid taxes on prem ium receipts in Arkansas as other corporations and persons paid taxes on personal property under state and county levies, which, in this county, amounted to about 3 per cent. When the new act went into effect, calling for 3 per cent additional, making a total tax of 6 per cent, the insurance companies became alarmed, and most of them withdrew from the state, some of them cancelling all policies in force before leaving. A few con- panies, however, remained, relying on the assurance of resident agents that the total tax of per cent was paya- ble in scrip and could be paid at a cost less than 2 per cent in currency, thus reducing the actual cost to a reasonable figure. The insurance paid but one tax under the act of 1873, as the first legislature which assembled under the Garland government enacted the law of Feb ruary, 1875, which supposedly repeal