The Birmingham age-herald., 1914-08-19
GOVERNOR EXPLAINS SOLVENT CREDITS TAX IN STATEMENT Declares Bitter Denuncia- tion of Law By Favored
 Classes Unwarranted
LAW WOULD EQUAL
 BURDEN OF TAXATION
Many Counties of State Protest Against Tax-Repeal Would Ex- empt Large Portion of Prop
 erty From Taxation

.'highly favored classes the rich and wealthy corporations and taxpayers" and that there is no reason why pro tests against such a mode of taxation should be made after the law has been in effect in the state since 1852, is the substance of a statement given out this afternoon by the governor of Ala bama in reply to those who have pro tested against the enforcement of the statute.
 The governor asserts that the pur- pose of the law providing for taxation against solvent credits is to equal the burden of taxation. to require the wealthy classes to bear their share of the expenses of government. In the opinion of the chief executive 1t would be unfair to tax the poor farmer and levy assessments upon tangible prop erty and to fail to force those owning solvent credits to pay their propor- ton
 A large number of counties in the state have protested against the tax on solvent credits and in certain counties the boards of revenue have refused to docket any solvent credits cases for consideration until the first of next yeer The counties of Jefferson, Mont eomery, Mobile. Madison and Calhoun have led the others In protesting against the law.
 .'The repeal of the tax on solvent credits would result in eXempting from taxation a large proportion of the property of the state says the gov ernor, and would be q confession that selfish special interests are powerful enough to control our taxing laws.
 The governor declares that every code since 1852 has contained sol ven credit clause except that of 1905. In that year the legislature provided for privilege tax on mortgages, deeds of trust, etc, and repealed the solvent credits tax. However, the legislature Of 1907 re-enacted the law and the leg stature of 1911 reaffirmed provisions pf the statute. The supreme court re rentlv declared the statute oonstitu- tional.
 The Governors Statement
 Following is the governors state nent.
 The right of the state of Alabama to lax solvent credits was questioned by certain taxpayers in Jefferson county, put on appeal the supreme court or the atate sustained the constitutionality of he present law and held that all solvent IediIs hot secured by recorded mort age were subject 10 taxation.
 -"It would have seemed that after an Shaustive consideration of the whole lestion and a final decision by the court last resort to the effect that solvent edits not secured by mortgage were xable, there would have been acqui- cence in the right of the state to en- rec from this large class of property just burdens of taxation
 Since this decison however, certain payers, boards of trade or commerce some of the larger cities of the state lta 70 in mass meetings adopted resolu- ns bitterly denouncing the taxation of vent credits, and have even carried cir opposition to the extent of asking u commissioners courts boards of revenue to refuse to perform their sworn duties, and to aid in nullifying the taxing laws of the state on this subject.
 eTaxation of solvent credits has been exercised by the legislature of Alabama for at least 50 years without successful attack, in some form or other Even prior to the civil war in the Code of 1852 solvent credits were taxed at the rate of 25 cents on each N00 in value. Where money was loaned at rate greater than the legal rate of interest rate Of 5C cents on each sl00 was imposed and to quote the language of the statute on Sal bills, notes. checks. certificates of de- posit or other issues the credits of any corporation, company, partnership or in- diyidual either in out of the state sused or employed in the way of loaning dealing in paper regular exchange business is regarded as capital under this chapter and must be assessed II gold CT silver was employed"
 "ln the code of 1867 a tax was i'm posed by section 434 subd yyision or all money loaned and solvent credits bearing interst, from which credits tho Indebtedness to the tax payer shall be deducted,' etc
 "ln the code of 1876 a similar clS was imposed.
 Tn the code of 1886 the same tax was found See section 453, subdivision '. code of 1886.
 Tn both the codes of 1867 and 1876 the indebtedness of the tax payer was deducted from the solvent credits.
 The reason why the exemption was disallowed was because it had beer discovered by actual operation that the effect was to practically nulify the law and open the door to fraud.
 Tn the code of 1886 the legislature for the first time departed from the principle of eNempting the indebted ness of the tax payer. See X the code of 1896, section 3911, subdivisions anC '. taxed money boarded, whether in the custody of the owner or on deposit r bank or elsewhere in this state or an. other state subject to check draft oi order. or in any safe deposit box, vaul or elsewhere. It also taxed the moneyec capital that is, all money loaned, sol vent credits credits of value, ane all money employed in the business O advancing or loaned on any kind O chattes, or personal property, or uset in buying or discountng notes, bond or bills of exchange There was m exemption of the indebtedness of tn tax payer.
 Privilege Tax Adopted
 By the act of the legislature adopte, the 3d of March, 1903, the legislatur nroyjdpd a priVilaqp gages deeds of trust. and instrument in the nature of Il mortgage. and re pea1ed the tax on solvent credits
 The first session of the legislatur held after the year 1903 re-enacted tn tax on solvent credits found in tn code of 1907, section 20s2, subdision l as follows: All money lent, solven credits, or credits of value, except sue as are secured by mortgage, deed o trust, or written contract of condi tional sale. upon which a tax impose by law has been paid Hence with tn