Daily Kennebec journal., 1917-02-15

recommended Tor appropriations is
uniformly the gross amount and in my
judgment the appropriation should be
made III that way in each instance on
the proper theory that all income of
every sort accruing to any State in
stitution. should either actually come
into the State treasury, or be account
ed for to the State treasury and its eX-
penditure authorized only in the reg
ular way
OF the remaining general items of in
come, two, the Maine Forestry Dis
trict and the Temporary Loan, are
matters of bookkeeping. The $4,000
estimated for the Maine Forestry Dis
trict is received by the State of Maine
and paid over for the purposes of the
district The 100000 Temporary Loan,
is listed both as revenue and eXpendi-
ture bcause it should be authorized for
both years, even if not needed.
The other regular revenue items
have to do with the Highway Depart
ment and they will be considered
later in connection with the expendi-
lures of that Department.
You will recall that in the estimated
expenditures published by the former
State auditor the necessary tax rate
was figured at eight mills for 1917 and
seven mills for 1918. AS a matter Of
fact the estimated revenue for 1913
was about 100000 too large, SO that
on the basis of the correct estimated
revenue and the total expenditures as
asked for by departments and insti-
tutions the suggested tax rate should
have been eight mills for each year.
Further discussion of this point will be
appropriate in connection with the
schedule Of expenditures. But let me
ask you to note carefully that the rec
ommendation Of the tax rate Of five
mills is conditional upon the schedule
Of expenditures suggested herewith,
and the additional revenue especially
during 1918 from the proposed changes
in the taxation laws.
1t should be noted also that the total
revenue for 1915 and 1916 cannot fairly
be compared with prospective revenues
for l917-191S without considering the
fact that in 1915-1916 the State tax for
three years was collected in two years
due to the change in the law making
the date of settlement December first
instead of January first following date
of assessment of the tax. On the basis
of existing laws and with the State tax
rate of five mills the total prospective
revenue for 1917 is $6,645,350.62 and for
1918 S6.520,SS7.66.
| now invite your attention to certain
proposed changes in the taxation laws
which must be made if the tax rate is
n bp kppt down to FIVE mills
Corporation Franchise Tax.
| am convinced that substantial in
crease in the franchise tax for corpor
ations chartered under the laws of
Maine would not be unduly burden
some to any concern actually employ
ing the amount of capital INDICATED by
its charter. | recommend that Section
is of Chapter Of the Revised Statutes
he amended SO as to provide the fol-
lowing increases:
Capital stock up to $4,000. increase
from s5 to $40.
Capital stock up to 100000 from SO
20 $25.
Capital stock up to $500, 900 from $50
to s75.
Capltal STOCK up 10 @I'VoJ,VoV from
SIS to 800.
Each additional million dollars of
capital stock from $50 to $100.
New revenue from this source Is es-
timated at $15O,000 for 1917 and $780,
900 for 1918.
Personal Property and improvements
in Unorganized Townships.
In accordance with suggestion of
the State Assessors. 1 recommend
legislation authorizing a State tax
upon all personal property and i'm
provements in unorganized townships.
Much of this property now escapes
taxation altogether and considerable
revenue from this source is possible
for the use of the State. The addi-
tional revenue is estimated at $4,000.
This and the following changes would
take effect in 1918.
Savings Deposits in National Banks.
1t is our established policy in Maine
to tax the savings deposits in savings
banks and in trust companies char
tered under our own State laws. So
far similar deposits in the savings de-
partments of National banks have es-
caped taxation. The National banks
point out with considerable force that
they are rendering an important pub
lie service by sustaining Federal Re
serve system and that they are some
what restricted in other ways in COM
parison with our own State banks
Though this contention is entitled to
some weight. it does not in my Judg-
ment establish their right to De re-
lieved altogether from the taxation i'm
posed upon the State banks with which
they compete. have recommended a
rate of three-eighths of one per cent,
somewhat less than the average PAID
by State banks and trust companies.
This tax should be assessed in the
same way as in the Vermont law:
that is, upon the individual depositor
with the option allowed to the bank OF
paying the tax on the average amount
of deposits. The revenue for 1915 on
the basis of the present total OF de-
posits would be $l17,26S.