Wood County reporter. [volume] (Grand Rapids [i.e. Wisconsin Rapids], Wis.) 1857-1923, 1913-01-16

of its advocates and demonstrated for thu
first time in the history or the country thai
a state income tax can be made effec
i've revenue producer The report OF thf
Tax Commission. which IS ready for sub
mission to you. presents summary of the
principal provisions of the law and the
full results Of its operation The snow
ing there made completely Yindicates the
wisdom Of the people in demanding an in
come tax and the legislature in establish
ing It, Designating the personal prop
ertF Offset. during the first year Of its
| administration it has yielded over $500
UuU IN FeyenGe-mOre than was collected
| throughout the entire United States under
the first Federal Income Tax of 1853. and
| many times more than was ever before
| collected from this source in 4 single year
| in ali the states of the Union put together.
/ The success Of the law as a revenue pro-
Queer has been demonstrated therefore be-
| yond dispute.
4 second and more important result
! shown by the report is the fact that this
/ revenue VIII largely come from sources
that failed heretofore to contribute their
fUH share No poor person viii contrib
ute Il single dollar Of revenue under this
law and no excessive burden is imposed
| upon the well-tO-dO or the wealthy. The
tax reaches less than = per cent of the
/ entire population Of the state.-a and this
| number. VIII contribute over 10 per cent
/ Of the revenue to be raised for all pur-
poses. In the light Of this experience and
the popular endorsement of the income
! tax az the recent election in the face OF
! the most determined opposition. it Is plain
! that the principle Of income taxation has
com therefore now confronfs you. Ihat
question has been settled by the decision
Of our courts and the verdict Of the people
1"aL Only uutE i 10 Simplify II ana rem
der it more effective in administration
The situation Is By no means strange
/ There were nc satisfactory urccedentS
among the income tax laws of other states
4 and 1t Is not surprising therefore that
/ minor defects developed in the practical
administration of our law. These defects
can be readily cured by amendment. y
number Of such changes designed to rem
der the law palmer and more consistent
have been suggested BIZ the Tax Com
I mission. and viii [ trust receive YOUR early
and favorable consideration. It seems to
me that no radical change in the general
scope or character of the act should be
made ut this time. Because national banks
are not subject to it. state banks should
be exempted also; bur both should be
taxed upon their personal property as
! heretofore
As originally introduced in the Iegis-
1 ldtUrc the present law exempted all per
/ SUnai property from taxation: but indS-
much as II was likely to be tested in
court and up to that time 10 state had sue
ceeded in administering an income tax
law. this provision was defeated The act
aS passed did exempt moneys and credits.
! household furniture. farm machinery, i'm
/ PIGMENTS ana tools. and 4 few other
! ticleS- These classes of property had al
! ways been poorly assessed and yielded very
! little revenue in proportion TO their actual
| value. At the same time provision was
| inserted IN the act authorizing any per-
! son paying a personal property tax to
"
| effect exempted him from personal prop
erty taxation to the extent that he was
also subject to an income tax. This pro
vision was designed primarily to preserve
| the existing status until the validity of the
law should be passed upon by the courts
and its usefulness as Il revenue producer
had been practically tested.
! Prior to the passage of the income tax
law the total tax yield Of personal prop
erty was S5.10S.55O; During the first year
OF ITS administration the income tax
! amounted 10 over $3500.000. The yield
from personal property sti!l subject to tax
| alton is estimated ut S3.752. $50 In view
of these facts the Tax Commission sug-
gests in its report that all personal prop
| erty may now be exempted except public
| utilities. and the stocks of banks and trust
companies. PROFESSIONALLY this is the
! final goal we all wish TO reach and if
conditions were ripe for the change l
| should Cheerfuuy concur in the SuggeS
| ton; but ii is not clear TO me that the
! time for doing this has yet arrived. The
! foregoing figures indicate that the income
derived from the personal property still
! aSSeSSable. and nearly $4,000 900 short of
the amount derived from personal prop
eFty taxation as II was prior to the re
cent exemptions. 1t is true that 1911 was
not prosperous year and that another
! twelve months experience in the admin
istration of the law may show larger re-
! turns But the gains in this direction may
be Offset in other ways. Several import
tax were reserved by the Supreme Court
| in its recent decision, and it seems to me
the law should be given fuller test both
in the courts and i'll practice before max
ing any fundamental change or hazarding
the loss of this added revenue
I recommend that no radical change in
the general scope or character of the in
come tax law be undertaken at this SEES
sion and that no further exemption of
| ments necessary to make the law simpler
and more easily understood by the tax
| payer and more effective from an admin
| iStrattve standpoint should be adopted
! without delay.
HIGHWAYS.
Under the present law the state high
way fund is raised by property tax.
specially levied and collected each year.
4 better policy would be if possible to
make it up from the general revenues of
the state and to raise only the amount
not thus available by a state tax.
The last legislature appropriated Il def
mite sum annually TO cover the cost of
! supervising the construction of roads and
bridges. Since this item of expense must
necessarily vary with the amount of work
to be supervised, it is desirable that 4
more elastic provision be incorporated in
the law | am told that in engineering
work of this sort the expense of super
vision is cuStomarily figured mt Il per
| ceurage of the total cost. In many states
this item runs high as fifteen per
cent of The entire amount The High
way Commission has informed me now
ever thas ii will be able to carry on
the work for not to exceed five per cent
of the cost of construction. should this
| percentage seem reasonable to the leg1S
lature the law should be amended accord
! iugly so as to obviate the necessity of
changing the amount to be allotted for
| this purpose each session of the legiS
| lature.
| Some states are now employing their
| prison COnvictS in building highways.
Colorado has been especially successful in
the development of this idea. If it be pos
sible TO apply it advantageouSly in Wis
| conSin. ii is highly desirable: but before
| finally deciding the matter preliminary eX-
perimentS should be made. l respectfully
recommend therefore that the Board of
| Control and the Highway Commission be
! given authority and limited apprOpria-
! ton To carry on Il joint investigation of
this subject by the use of limited num-
! Der of convicts in road work in the north
| ern part of the state. preferably on lands
! reserved for refOreStation. and that they
he required to report To the next legisla-
! ture the results of the experiment. togeth-
| er with their recommendations.
| There Is some criticism OF the lack of
continuity IN the stretches or road now
being built by means of state AID and
| many suggestions have been made for the
more rapid completion of the main lines
I of traffic. One way in which this bject
may be promoted is TO change the auto
| mobile license tax from a uniform sum
, per ear as at present to 4 reasonable mini
, mum charge for the lighter cars. with Il
proporuonate increase for the larger auto
; mobiles, depending on horse power or
weight. The proceeds of this tax instead
, OF going as at present in large part to
the counties where ii is frequently frit-
, | tered away without any permanent i'm
provement to show for it. should be used
| under the direction of the Highway Com
mission in the maintenance and conStruc-
! ton OF the lines Of traffic which connect
a the principal cities and villages of the
2 | state.
CONSERVATION OF NATURAL RE
SOURCES.
g In my message of two years ago l call
- | Ell attention to the disparity which eN-
- | lists between taxes on mineral deposits and
= | on timber. Standing timber is taxed every
o year under the general rule. Minerals be
. ing under ground aud not readily open
: | to view. almost invariably escape This i
| true Of all the important minerals of the
X | state whether iron, lead or zine. The
f facts in detail for each piece of property
: | in explored areas both aS regards guam.
n | tity and quality of the deposits should be
o / aScertained is in Michigan and Minnesota
i and the land taxed the same rs other
/ property.
: bodies there are extensive areas in the
: northern part of the state, some Of whicl
g are known 10 contain iron bearing forma