Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1913-02-20
NUGENT INSISTS
"PRU' MUST PAY
City Counsel Continues Fight
for Taxes, Despite De-
feat of Bill.

Despite The fact that he was unsuc-
cessful in his effort to have passed
Assembly bill No. 81. introduced by
Assembiyman Rowe, Of Essex. which
amends the law relative to the taxa
ton of insurance companies In the
State. City Counsel James r. Nugent
is not in the least disheartened Mr.
Nugent declared there was nothing
that would stop him from continuing
his attempt to make the Prudential
Insurance Company pay Newark the
amount of taxes he believes is just.
Referring TO the brief which he pre-
sented to the members of the Assem-
bly,. Mr.. Nugent pointed out that the
deferred dividend policyholders would
not be affeet&. The taxes would
have to be taken from the assets of
the company and the brief goes on to
say that false statements were con-
veyed to the policyholders in refer
ence to the effect the passage of the
bill would have. Mr.. Nugent said
that when the bill was first introduced
there seemed to be no objection to it
until the Prudential got busy, and, as
|
throughout the State lombard the
assemblymen with letters against the
bill.
Mr.. Nugent went on to say that his
answer to the Prudential Company's
statements, which was published in
the leading papers of the State, was
a true statement of the facts in the
case. He hoped to be able TO make
the Prudential pay its just tax and to
be able to convince the polieyholders
that this tax would not take anything
form them, he added,
In the brief which he submitted to
the assemblymen Mr.. Nugent said in
part:
This bin amends the present law rela-
| tive TO the taxation of life assurance
| compa MES IN this State, but 1t changes
| It only in this particular namely, that
| the companies under this bill will be en-
| titled to less exemptions than they are
entitled to under the present law The
bill does not subject to taxation the
| funds apportioned to deferred dividend
policyholders: 1t will not result in the
| taxation of any funds set aside for the
benefit of policyholders.
| The companies are taxed and pay the
/ tax, not the policyholders. They are
/ taxed upon the amount or value of their
| property less deductions widowed Jaw
and the tax Is levied against and paid by
| the company out of its surplus upon the net
| amount of its assets that Is, the amount
! or value of its property remaining after
deduction of the exemptions allowed by
| law, and this tax Is levied against and
payable by the company itself, and not
| by the policyholders
The main purpose of this BILL No. 81,
! is to reduce the amount Of exemptions
| which the companies may offset against
| the amount and value of their property,
| and thereto to increase the amount OF
net surplus subject TO taxation. Under
| this bill, No. 81, the companies will only
| be entitled TO deduct as a liability on
policies the reserve held to insure the
payment of the face of the policies at
| maturity, and will not be entitled to de-
duct also, a liability on policies, funds
held under chapter Il, laws of 1871, TO
| secure the payment of dividends upon
| deferred dividend policies. 1t so hap
pens that this bill will affect especially
the Prudential Insurance Company, Tor
/ the reason that the Prudential Insurance
Company Is l understand. the only or
principal company of this State that has
| issued and has now in force these de-
ferred dividend policies.
Mr.. Dryden is evidently misinformed
and misnnderstands the purpose aud
effect of this bill. If the bill becomes a
law and thereby the tax payable by the
company is increased, no part OF that
can be charged against the deferred divi-
dend fund; the tax Will be tax upon
the company and not upon this fund,
and being a tax upon the company and
upon the assets of the company, 1t can
not in justice or in law be charged or
paid by the company out of this de-
ferred dividend fund. 1t must be paid
by the company out of its general assets
In his statement Mr.. Dryden further says,
1.-THE question to be decided is the simple
one whether the State of New Jersey de
sires 10 give to the city OF Newark the
right to place annually heavy tax on
these savings Of the workingmen and
their families from one end of the State
TO the other. The Prudential has taken
the position that this fund should be
as sacred from the hands of the taxing
officer as any funds in the State"
This statement is also, although unin-
tentonally, absolutely misleading. The
fund is not taxed, as we have already
shown. the savings of the workingmen
are not taxed, and the sacred nature OF
this fund so dear to the officers of this
company, is in nowise affected by this
proposed legislation. The company and
its stockholders viii pay the tax, and
not the benefciaries of this fund