Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1912-11-14
Different WAY
TO TAX RAILROADS.
Governor Fletcher Recommends
a Method Of Saving 100000
for the State.

Montpelier, Nov, 7-Governor tIetcher
created tho sensation Of tho session this
morning when he issued a message nd ,
N"catihS change in the method OF tax
ing r"iiroahs. Apparently there was nos
the slightest intimotion that such q com.
nunication was coming. Within n half
hour railroad attorneys were scurryinp
about tho corridors as though each ono
ma bee fastened upon his ANATOMY
The recommendation was that tina
clause which allows railroads at their
option To pay two and ono-hnlf Der cent
upon their gross receipts instead ef be-
Ing ferced to pay upon one and ene-
quarter per cent. of their appraised
valns. be repealed.
The reason for the suggested change
He's IN tho fact that with the law giving
the option 10 the railroad as it does at
present there is always tho possibility
OF accounts being so manipulated that
tho State will be deprived of its duo
of the taxes. For instance. a road sit.
uatod as all important railroads are.
part In ono State and part in another.
or road which Is really part of a
larger system may eonceivs.bly arrange
to have large part OF Ids earnings
that the State win lose by taxing ito
earnings. In order TO minimize the pos
sihility Of such evasion Of taxes on the
part OF railroads. the State would be
forced under the present system to en-
pIoy Tor that express purpose an expert
accountant and corps OF assistants
That the State Is losing by the
present system is apparent from fig.
ures obtained at the ONCE OF the com-
missioner OF taxes which show that
for the calendar year of 1911 tho
amount collected on gross earnings
was s315,234.35, while the tax under
Governor Fletchers recommendation
would be s4244b8.12. This would have
meant hundred thousand dollars
more income for the State. A further
objection made to tae present system
is that It is said to work injustice az
between the railroads themselves.
The text of the message follows:
state of Vermont. Executive Depart.
ment.
ITO the Honorable Senate and House
of Representatives.
"Gentlemen:
Tn view Of conditions which now
exist in the general railroad world. r
desire to suggest for your serious COM
sideration a aiical change In the
States present method OF taxing the
railroad corporations.
"Under the existing law the rail.
roads are taxed. first. upon an ap-
pra!sement made by the tax commits
sioner at a rate of one and one-ouar-
ter per cent OF the appraised value,
or, in lieu thereof. the option is given
them to pay two and one-half per cent.
on their gross receipts.
AT present nearly all OF tho railroads
Of the State exercise the option of pay
| ing a tax based on gross receipts. There.
| fore. for the State 10 know that the spirit
of the lawis strictly adhered TO. II will he
| come necessary to employ a competent -
! countant with a large force to review
| Ira ctically every rate made by the rail.
roads in this State. This would seem &c
| be very expensive and in many respece
not TO be desired.
After n thorough Investigation Of thik
| subject, I am convinced as matter OF
! state policy that It would be better ia
repeal the gross receipts clause OF the
present law and I earnestly recommend
that the same be done.
II have the honor to be your obedient
servant,
ALLEN NJ. FLETCHER, Governor.
November :, 1912.