The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-10-15
THE STOCK TRANSFER TAX.
sound Economic Reasons why II should
lie Abolished by the Legislature.

To TIE EDITOR or THE SUN--ST: The
Legislature OF this State should. at
special session. or as soon as II convenes
in January, pass a law abolishing the
~ stock transfer tax. Congress Is con-
templating the enactment Of IA law putting
" tax on sales, thereby doubling the
present burden. Some OF the Representa-
tives In Congress say that while they
sympathize with the New York objections
to this double taxation they cannot dis
eliminate in favor OF stock sales when
sales OF other properties are to be taxed
They assert that this is n special war tax
and that they cannot take cognlzance or
the fact that a State having market
within Its boundaries levies taxes for IT'S
own benefit
The objection to taxing sales is eco
nomic and Is even disapproved by such
a man rs Lloyd George OF England. Trad
ing should be unhampered a tax on sales
Is drag on the market wheel small
tax oOstructs free trading and a large
one prohibits a. Very little would he
collected from 81 tax, and at this very
crucial time Il would seriously retard
business.
The value OF the Stock Exchange to the
public is largely that of a barometer OF
values Billions OF securities are listed
there. bu; the amount traded In is pro-
portionally very small.
holder sees the market prices. II
satisfied az 10 the value OF his security
and can borrow on the same n required.
Holders do not all try to sell at once,
Just az bank depostors do not all draw
their money nt one time Therefore Il
Is necessary that the market be free and
unencumbercd 20 that there can be plenty
OF activity and ready purchaser for
those who wish TO sell The economists
show that traders are necessary Henry
George said that they were. and called
them the buffers of finance. a close
market cannot be maintained without
them.
The traders do not all make money
tho net amount of their profit IL nothing
compared with their aid In making "a
close market. With this double taxation
II trader makes n profit OF one-eighth,
$3.50. he must pay tax OF 50 ana
also the expenses ot the transaction,
which Is 81 his net profit IS therefore
$3.50. II there II the same loss he ~
out Of pocket $3.50. He also has the
interest on hts seat TO pay so that the
double tax viii do away with floor trad
ing No money was made when paying Il
81 tax, and this 10 the last straw.
There will therefore be small market.
which VIII not properly reflect values.
For some timo past the brokers have
kept this market for the publi' without
profit to themselves. but this burden will
! curtail their business so seriously that
larger commission must ne charged II
! they are TO he kept alive.
Imagine the state Of Michigan passing
n law which would injure the automobile
| business o. Detroit an Industry that has
made the city rich Yet the people Of
this State should realize that the Stock
Exchange is an intimate part of their
/ welfare. When the eNchtnge - doing
/ good business all the stores In the city
| feel It's prosperity.
| with these taxes there will be few
! commissions and no tax u, consequence
| collected. II will stop business There Is
! the danger. For the proper prosperity "
/ wall Street and this city there should be
no tax. state or national. and II is the
! patriotic duty OF the Governor and Legis-
/ lature Of this state 70 abolish the tax
with the greatest celebrity. so that when
| the exchange opens. with All that II
! means to security holders IN this country.
| there may be a safe market.
New YORK October -. DANGER.