The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-03-24
TAX DODGERS SMOKED
(, OUT BY INCOME LAW
Remarkable Increase in Sccu-
rites Reported to state
Since Its Passage.
MEANS GREATER REVENUE
Secured Debt Bureau Reports
Increase From S24l,O5O
TO S626,O42.

Unexpected Dement'S TO the State OF New
York through the income tax law were
made known yesterday through state
ment BY Frank p. Young. chief of the Sc
cured debt tax bureau OF the State Comp
trolIer's office II dlscloses remarkable
Increase In the revenues derived by the
bureau through the registration OF bonds,
notes and other securities by which the
owners escape personal tax on them by
paying the registration fee OF one-half OF
! per cent OF the value OF the bonds.
Mr.. Young makes the remarkable dis
closure that although over S600.000.000
of bonds have been registered with the Sc
cured debt tax bureau since 1911. there has
been no corresponding decrease In the
amount of taxable personal property re-
ported in the city. This. Mr.. Young says.
''would seem to show that owners or
bonds paying this tax never paid the per-
sonal property tax"
The secured debt tax law, which has
b<en In effect since October 1, 1911, Is
practically an extension OF the mortgage
recording tax law to mortgages on prop
erty outside OF New York state ana to
bonds, notes and debeutures for $1,000 or
less II the secured debt tax 10 not paid
the owner Is liable to a local assessment
~ the luIl rate Oh MS Oonus, HUGE anu
mortgages II the taxing authorities hhd
out abou, them. and the owner 10 not pr
mitted to offset his Indebtedness. as was
the case before the law was passed.
Tho purpose OF the law is to provide q
Axed tax at a low rate In place OF the
unequal personal property assessment OF
securities. which not alone failed to pro-
auce revenue but had a tendency to drive
many large bondhodeis to find resi-
dtnce outside the State to escape per-
sonal tax on their bonds.
Chief Clerk Young reported. and II IL
believed that the reports mace under the
income tax law are the cause. that for the
first time In seven years the personal
property of residents of New York city
on the city assessment rolls showed an
Increase. The amount added Is the re-
variable figure Of sl+.s74,220.
The FIRST year Of the operation of the
secured debt tax law yielded an income
Of S24s.5s5. and the second showed a
slight falling of. or S244.050. The last
fsscal year, ended last Saturday. resulted
IN = revenue OF ss2S.0%2 on securities
worth Sla5.zos.loo. as compared with only
eAS.810.000 registered last year.
While Mr.. Young was not willing to
say that the income tax law Is entirely
responsible for the remarkable increase.
he believes II Is one OF the chief causes,
since there 10 a belief in many circles
that It might be possible for the State
taxing authorities to get possession OF
the income tar returns as a check upon
the personal property returns made to the
city and State authorities.
Concerning the increase shown for the
past fiscal year Mr.. Young said:
Tho large Increase made UP to to-day
Tor the present fiscal year Is very graft
flying and II amendments recommended by
the State Comptroller in his annual report
TO the Legislature are enacted into law
] believe q greater income will result
Tho appointments provide for the regis
tration of bonds. notes and deoentures Of
all denominations and for the registration
OF mortgages on property both within
and without the State which have been
recorded since July /, 1906"