The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-10-11

was raised In 1s5s-54 TO three and third per
cent and in 1s55-ss to six and two-third per e,,
cent During the Civil war the rate was greatly
Increased. In is6l-62 II was ten per cent. ana
in 1863 seventeen per cent. 1t win be at once
seen that this tax really a form of income
tax and was 50 intended. since the rates corr
respond to those levied dividends from otner
kinds OF stock, which we discussed in the articles
on the income tax. 1t is proper to note the
tax on bank stock dividends here. however, be-
cause they singled out, even before direct
tax on banks was ever levied for special taxa
ton.
In 1850 there was levied the first direct tax
on banks 1t Will be noted that the indirect
quasi-tncome tax still continued, however
The tax the capital of banks and
had to be paid by the banks 1t was in the
form of license and 1t will best be shown by
giving the rates for the years lndlcated oeiow,
Bank Capital 1S60-61 ls61-62 1853
5000, oo0-s40o, 600 .... 100 $50 go
s400. 000---s600. 900 go. $50 225 375
$500. 000--sS00, 600 zoo 800 500
$500, 900 and over. ..,. $50 375 625
The extraordinary increase in rates were due,
of course to the extraordinary demands upon
the treasury during the Civil war. do not
find any further changes in rates during the
war, although in most instances rates of taxation
on other taxables were greatly decreased in
1865.
After the reconstruction when the Underwood
constitution went into effect, the capital OF
This was due to the passage of the national
banking act of 1864 amended in 1868, and
the decisions Interpreting these laws declaring
State tax the capital of national banks to
he Illegal In 1871 the Virginia assembly In
It's general revenue act placed a tax bank
stock but 1t stipulated that bank stock was
to be taxed at the rate other intangible
property. The law did not specify whether the
book market value of the stock was TO be
the basis for assessment. and in 1884 an amend
ment specified market value as the basis. The
tax remained unchanged until 1903. when 1t
provided that the market value of bank
stock should not be less than its proportion of
the capital, the surplus and the undivided profits
Of the bank In 1908 it was provided in an act
of the assembly that reduction of 10 per cent
in the value of the stock for debts due the bank
by shareholders could be made, The tax on
bank stock is paid through the banks, and this
deduction can be made only when statement of
debts due and securities held is filed with the
State For instance, only 119 out of $50 banks
assessed by the State in 1910 awaited them
selves Of this deduction the 224 others presum-
| ably preferrtng to pay the tax than file state
ments. Deductions are also allowed for assessed
value Of real estate of banks otherwise taxed
by the State and, of course, these deductions
taken advantage Of.
While under the present system of taxation
there is manifest inequality which bears
heavily on the bank-in that bank stock Is taxed
at It's market value outlined above, while
real property is taxed at about onethird of its
value and much of the other intangible property
escapes taxation altogether-the operation of the
+ tax In producing revenue has been of the
most satisfactory from the earliest tax bank
stock dividends to the present. In 1888 the
revenue LOFT; In 1S39-40 ss4.715; and in
/ 1901 Si20.030. At about the last named
/ figure 1t continued until 1s43-44. when the
receipts increased to s142.865, In fS46-4T the
revenue was S15S.903, and in ls49-50 $1S0.116.
continued in about that each year until
the outbreak of the Civil The period Of
4 taxation of the capital of banks we
have seen, quite brief and the available data
tdoes not show the receipts separately from other
revenue Under the present system of taxing
bank stock as intangible property the following
dicated will indicate the growth OF the i'm
portapce of the tax: