The Bennington evening banner. (Bennington, Vt.) 19??-1961, 1913-04-09
BENNINGTON, VT, APRIL .. 1918
THE NEW TAX LAW

| letter lS as IOllOWs.
ain your Issue of the 4th inst, there
appears to be published the views of
, Governor Fletcher regarding the inter
probation of the law abolishing offsets
and double taxation on real estate,
passed by the last Legislature.
believe the Governor has missed
the purpose of the Legislature entire
ly If he is correctly quoted when he
says, ut is generally understood to
have been the purpose of the Legisla-
ture to extend this exemption to all
secured loans at five per cent. or less
whether of money or credit"
Now what was the purpose of the
Legislature in passing that law?
1t appeared to the members of the
Legislature that too much Vermont
money was going out West and else
where to develop those sections. II
also appeared to the members of the
Legislature that Vermont real estate
was not as active as ii should be. The
grand lists were increasing to meet
the increasing expenses, not from new
developments in real estate, but from
increasing the valuation upon devel-
opments OF long standing. In other
words 1t was the grand lists that were
increasing and not the taxable prop
erty. With increase In real estate de-
velopments comes increase in taxable
property and a corresponding de.
crease in tax rates. The purpose of
the Legislature was to increase the
new buildings. new farm develop
ments, the creation of new property
of all kinds here In the State to the
end that tax rates might be reduced
by the advent Of new property that
could be taxed
If this Vermont money that was 60
ing West could be kept at home these
new things would come to Vermont
instead of to the West People hav.
ing money to loan were dissatisfied
with conditions for loaning here at
home and sought more favorable con.
ditions out West for investment. 1t
was to change those unsatisfactory
, conditions here at home and to make
| them as near like those conditions in
the West as possible that was the pur
pose OF the Legislature. The Legisla.
ture believed the double taxation of
real estate was the trouble here In
Vermont and hence removed IL.
As Is often the case in matters of
great reform In legislation there slip
ped in the bond for the deed and the
collateral loans business, matters en-
tirely foreign to the matter of double
taxation of real estate and its attend.
ant burdens. The friends of the aboll
ton OF double taxation of real estate
did not dare to imperll the success of
that part OF the program by alienat-
ing the support of those who bought
the bond for the deed and the chattel
loan business was going to lead the
State out Of the wilderness.
The essence of the problem before
the Legislature was this: Investors
In real estate loans in Vermont had to
pay the local rates OF taxation on the
money invested. Investors in real es-
tate loans in other States did not have
TO pay this local rate of taxation.
Hence money seeking real estate In
vestment went to those States where
such investments were not taxed.
Now the owner of real estate will
not pay the ruinous rates for money
that the borrower on personal proper.
~ viii pay but will stagnate.
Here therefore was a deadlock be-
teween capital and Vermont real es.
tate owners that nothing but legisla.
ion could abolish. The thing that was
leaving the State was money not cred
1t or debt. 1t was and is and always
VIII be just as easy to get into debt
mere in vermont as anywhere else and
no legislation is necessary to facili
tate that process, It was not possible
TO borrow money on Vermont real es-
tate upon terms In reason however
without legislation. Money whose
owners wanted real estate property
security was leaving Vermont because
mat loan was taxed in Vermont and
going to other states where that Sc
curity was not taxed. Credit was here
and debt was here in abundance. But
credit without money and debt are
poor things to build houses with or TO
develop real estate with. Money is the
essential thing.
| Hence the Legislature exempted
money and did not exempt credit or
debt What the Legislature, EXEMPT
ed was what>you want and what Won
get when you take your real estate or
personal property security TO an in
Vestor and exchange Il temporarily
Tor money. What the Legislature tried
TO do was to have some money in each
community waiting for Just such emer
gencies when the person with real es.
! tate or personal security wanted IA
exchange II temporarily for money.
| The Legislature tried to bring the
real estate investor and the real es-
tate borrower together for the purpose
Oh creating new taxable property and
thereby reducing tax rates here In
vermont. The Legislature did not try
TO make II easier to get into debt here
! n vermont, for that was already easy
enough. Therefore I believe n Is
wrong to try to read into the law anv.
thing that is not there and therefore
l believe the only thing that should be
exempt is money loaned.
ANY subterfuge for the process CT
loaning money should be turned down
oy the listers and they should draw a
sharp line between money loaned and
count.
The loaning Of money was IN N.
legislative mind and the exenntior =,
money loaned was All /, aufbortz.l
me roaming OF canned goods and dry
sooos was not In the legislative mind
AZ All and II Is error to suppose that Il
vas when all the evidence and All
ne debates hinged on the loaning Of
money.
With the appeal COMMITTEES Al
Work In Montpelier and the forces III
nature busy All along fhe -. -.