The Richmond Virginian. (Richmond, Va.) 1910-1920, 1916-02-09
ADVISORY BOARD WOULD
PERFECT SEGREGATION
This Is Intent of Communication 70
Finance Committees of Cen
eral Assembly.
ARE TO MEET ON TT TO-DAY
Governor and Auditor Authorize Pub
lication OF Recommendations.
100000 Is Estimated Increase In
States Revenues by Plan.

not contemplate increasing taxes to
provide for the necessary increase OF
$4,000 in revenue for the State is
indicated in the communication winch
the board sent to the Finance Com
lnittecs of the General Assembly sew
eral days ago. and which was gwen
out for publication by Governor Stuart
and Auditor Moore yesterday.
The intent of the recommendations
made, 1t Is declared. Is to bring ABOUT
a more uniform and thorough assess
ment, perfecting the segregation plan,
rather than an increase OF the taxes.
The Advisory Board proposes that the
$4,000 shall be raised from these
sources. as follows: From merchants
license tax, s250,000; shares OF bank
stock, $4,000: capital in business.
100000: franchise tax. L$50.O00: In
tangibles not yet discovered. including
real estate notes, 100000; light and
power companies. $4,000. incomes,
$4,000: normal increase In revenue,
s250.0o0.
The Finance Committees of the SEN
ate and House will meet this after
noon to consider in detail the recon-
mendations made in the communica-
tion of the board. The text OF this, as
made public yesterday, follows:
ITO the Finance Committee of the
OF the House of Delegates: E.
''0entlemen.-Thep plan OF segrega-
ton contemplated no change in the
state license tax on merchants: also
contemplated that the state would re-
ceive so cents on each 500 OF the
assessed value OF the shares OF bank
stock. and that the State tax rate on
Sntanxfhies would be 70 cents: but
the State tax on merchants whose pur-
chases exceeded $4,000, and did not
exceed $4,000, was reduced from 80
cents to 20 cents, and the tax on bank
stock. for state and local purposes,
was fixed at $3.50. but allowed OF this
$50 only IS cents to the State. IN
stead of SO cents. All OF this Is ex-
planned in the preface TO the report
of the auditor OF public accounts for
-i9iE
1t Is not the purpose under the plan
OF segregation to increase taxes. but
TO bring about more uniform ana
thorough assessments throughout tho
Commonwealth with the view of re-
ducing taxes. Under the segregation
plan the State imposed no tax on real
estate which includes agricultural
lands. mineral landA minerals, stand
ing timber, town lots, city lots and
buildings and Improvements on real
estate; also roadway and track and
other real estate OF public service cor
porations: nor upon any tangible per-
sonal property Except the rolling
stock OF railroad corporations oper-
ated by steam) other than 10 cents
on each 500 assessed valuation.
which tax In devoted exclusively to the
support of the public free schools and
cannot be used for any other govern
ment expenses. BY this action the
State released taxes on real estate
amounting to 81. 400. 900, and on tan
gibte personal property, $2T5,0oo. the
total amount released being s1,6Tk,-
eco. To Offset this loss. the increase
in the State revenue from taxes on
intangible personal property is $73s,-
asa net loss OF revenue to the State
of ss4s.S1s.
Merchants.
II has been claimed by the mer-
chants, both wholesale and retail, that
.heir,c ca pitalt<sshte1. IL assessed at face
value subject to certain deductions. has
not participated in the benefits OF the
new law. which provides a limited
rate on all other intangtbies. The rea-
son for the limited rate on intAnsibles
has been very fully discussed and, we
feel. IL thoroughly justified on the
ground that II affords in this lower
rate appropriate relief against the
consequences OF any under-assessmen
OF real estate and tangible personal
property We are of the opinion that
merchantE capital. the tax on which
ia purely local. should be afforded the
same measure OF relief as has been
afforded other classes OF intangibles.
and to this end we suggest a local
rate on the net capital OF merchants
not to exceed 9b cents for All local
purposes. which is the maximum
amount authorized on other classes
of intangibIes. or In cities and towns
an appropriate license tax In lieu
thereof
1t must be remembered, however.
that the merchants conduct a business
upon which the State has always de-
ciared and exercised the right to i'm
pose a license tax over and above
the local tax on capital, which IL
cense tax the State has accepted in
lieu OF all other taxes on merchants
The action Of the last General Assem-
bly, in lowering the license tax on
merchants, which goes exclusively to
this State, has resulted in serious
shortage OF revenue from that source
In making the recommendation Tor
equaliSing the rates on merchants
capital which must result in substan-
tial relief to this class OF property.
we feel that coupled with this felief
the state should have o more substan-
therefore. recommend that the State
license tax be fxed as follows:
Ten dollars on purchases OF So
600 or less; an additional tax at the
rate Of thirty cents on each 800 OF
purchases in excess of $4,000 and up
TO and including 100000: further
additional tax at the rate OF twenty
cents on each 800 of purchases in
excess of 10000 up to and including
$500, 900, and q further additional tax
at the rate OF ten cents on each 500
of purchases over 100000.
Shares of Bank Stock.
The estimated yield OF State revenue
under the segregation plan was based
on q tax of fifty cents on each s100
assessed value of the shares of bank
stock. The bill as finally passed lin
tied the States participation in this
tax to thirty-five cents. reducing the
States revenue to that extent. The
annual loss of revenue to the State
from this reduction amounted to $751;
600. II it recommended that this loss
be made good by allowing the State
fifty cents OF whatever total rate the
General Assembly may prescribe. and
that the law be amended accordingly.
Capital In Business.
II Is suggested that the present
statute requiring the taxation Of cap
ital OF individuals and corporation