The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1913-08-21
Mullan, Idaho. August 20.


Taxation Is the source of revenue of
all civilized governments and the bur
den of such taxation should fall equal
" upon ALL according to wealth and
advantages, whether individuals or
corporations. The state of Idaho de-
pends upon its great industries for the
support Of its government and among
them its few producing mines are an
important factor.
Why Stockholders Complain.
Litigation Is now pending in the
supreme court of the state of New
York in which the minority holders Of
stock in the Federal Mining e. Smelt-
ing company, whose properties are In
Shoshone county, Idaho, are seeking
to show that since September 1909,
they have been deprived of profits on
the sale of lead from the Federal mines
to the amount of s550,000 per annum.
and also to annul an illegal, unfair
contract made prior to the above date
between the Guggenheim smelter trust
and the Federal Mining & Smelling
company.
This annual loss of profits above
referred to, which decreases or in
creases according to the price of the
| lead market, does not appear on the
books of the Federal company in It's
flee, the two agreeing.
Tax System Defined.
Section 1863 of the Revised Codes of
Idaho provides that "the net annual
proceeds of all mines and mining
claims shall be taxed In Section
1854, met profits" are defined, and
Section 1855 reads as follows:
Every person, corporation or asso-
citation engaged in mining must make
out statement of the net profits de-
rived from the mining of such metals
lor minerals. Such statement must be
verified by the oath of such person.
or superintendent or managing agent
of such corporation or association,
who must deliver the same to the as
SCISSOR of the county In which such
mine Is situated"
Further sections Of the law provide
that false statement shall constitute
perjury, and give the assessor the
right to examine books and accounts
In order to verify statements.
The property of the Federal is taxed
probably according to net profits as
shown on the books of the company
but this does not represent the full
earnings of the mines, the balance go
ing into the pockets of the smelling
interests, and the, people of Idaho and
of Shoshone county are being depriv
ed of the amount of taxation due
thereon.
met Output'-What II Is.
The intent of the law seems to be
very clear, explaining as it does that
net profits shall mean all the profits.
Section 1854 is as follows:
Section 1854 The term net pro-
fits, as employed in this chapter.
means the amount of money received
from the min .ng Of said metals or MN
erals from sid mino or mining claim,
after the deduction cf the actual ex-
pt nditure Of money and labor In and
atout extracting the metals an, min
erals from the mine or mining claim,
and transporting the same to the mill.
concentrator or reduction works, and
the reduction thereof. and the conver-
sion of the same into money, or It's
equivalent, and also the deduction Of
sl moneys expended for necessary Ia
Dor, machinery and supplies nae.led
and used in the mining operations, for
the improvements necessary in and
about the mine or mining claim. for
reducing .ores, for the construction oe
the mills and reduction works used and
operated in connection with the mine
or mining claim, for transporting the
ore. and for extracting the metals and
minerals therefrom.''
The Losers.
No matter what may be the out-
come Of the litigation between the
minority and majority stockholders of
the Federal Mining g. Smelling COM
pany, this fact remains the same-the
state of Idaho. the county of Shoshone,
the local municipalities and school dis
tricts are being cheated out of part of
their revenue by this misrepresenta-
tion Of the real earnings of the Fed
eral company's mines
The same applies to the Greenhill-
Cleveland property, working under the
same kind Of contract. favoring the
smelter and fleeing the stockholders
and the taxpayers Of Idaho. This loss
to stockholders Is annually about
$4,000.
Taxes Run Into Big Figures.
The average annual loss to stock
holders has been $55O,00O year for
four years. Compared with the Hercu
les contract the total taxes at per cent
would have reached $66,000 If paid
when due. Estimating the total taxes
which should have been paid and the
penalties and interest now due. the
amount reaches over $4,000 Had this,