Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1915-01-24
Municipal Securities and Mortgages

IN the report OF the Committee on Tax Re-
visions it was recommended that the Leg
is!ature should fix the rate Of taxation on in
tangible personal property at I per cent or
81 on the 500. from which general rule
there were three exceptions. One of these
was the 20-ccnt tax on bank deposits fixed
bS law already on the statute books, while
the two others were i'm tho amount of the
tax on municipal securities and the tax on
mortgages For these latter rate of SO
cents per 500 was recommended.
The measure introduced in the General AS
sembly yesterday by Senator Buchanan and
Delegate Weaver departs substantially from
these recommendations. In the first place.
II reduces the general State tax on intanyi-
hlcs from s. TO 20 cents. and in the second it
places all intangible property with tho single
exception of bank deposits in tho same class.
III the reduction il makes, We consider the
new measure wise but in its failure TO confer
4 larger exemption on municipal securities
ana mortgages we believe it runs counter both
10 the teachings Of experience and the special
needs of this State
On this subject the views OF the Committee
on Tax Revision arc strong and convincing
AS to municipal securities, the COMMITTEES
cites the fact that in twcnty-four States thew
arc entirely exempt from taxation and that
inc whole tendency is to apply this exemption
III other States. The result Of the practices
hitherto followed in Virginia. the committee
says. rs that the Commonwealth affords a
poor market for securities of its own munich
paltics. and consequently great part of
them have TO be disposed of in other States
This naturally causes Il higher rate of in
tcrcst than would otherwise be necessary and
deprlNes the government of all revenue
whatsoever from securities so disposed Of
rms reasoning appears TO us 10 he unanswcr-
able. and to afford ample ground for showing
TO this class OF intangibles consideration
withheld from most others
III Is so also with mortgages The com
mlttccs proposal OF n accent mortgage tax
was based on It's desire Ito furnish relief to
inc relatively small borrower, who can offer
as security only his home or his farm or soma
|. similar property" The committee recog-
nized that to such borrowers obtaining loans
Is frequently 81 matter of difficulty 1t NAV
be recognized also. and as matter of course
'nht me borrower pays whatever tax is
cXacted.
Inc committee found that there was
wand distinction between such loans and
those obtained by large corporations and rem
resented by bonds that are negotiable in the
open market. Richmond real estate experts
at hearings before committees OF the Lcgisla-
1urc have expressed their concurrence i'm
this view.
The General Assembly. before the final pas
sage OF the Weaver Buchanan bill. would do
wen TO incorporate in it further concessions
to municipal securities and mortgages 1t is
quite certain that. unless such concessions
are made. evidences OF Virginia Indebtedness
oil inns character will continue to seek and
ma market outside the State and thus so
lar as the movement extends. continue TO de-
prive the government Of all revenue what
ever from these sources