New-York tribune., 1918-04-21
By F. J. H. Sutton
Iice-President Guaranty Trust Com
pany, of Nesv York

Dy T. y. II. SuICOn
Vice-President Guaranty Trust Conn.,
pamy, of New York
a T THE end of the session of
~ the New York Legislature
there was passed under an
emergency message from the Governor
bill to amend the tax law, extending
the application of the New York in
hcritance taxes to security holdings by
on-residents. The bill as passed was
in form never presented or discussed
before the Legislature or any commit
tee of the Legislature.
At the early part of the legislative
session a bill was presented by the
New York State Controller generally
to amend the sections of the tax law
referring to inheritance taxes, the in
tent being to make any cash, securities
or other evidences of property whatso-
ever found in this state, and however
evidenced, subject to the transfer tax,
whether the decedent was a resident
of the state or not. 1t was believed
that the opposition presented in be-
half of trust companies, safe deposit
companies and dealers in securities at
the legislative committee hearings had
convinced the Legislature that the
rolicy embraced by the proposed bill
would be detrimental to the best in
! terests of the state. The Senate Com
mittee on Taxation decided to drop the
matter.
Bill Passed
Under Pressure
However, on the next to the last dav
o. the session representatives of the
State Controller caused the Governor
or the state to write an emergency
message to the Legislature requesting
the passage of the bill in an amended
form. Their request was granted and
the bill was passed by both houses
without minutes debate as to it's
merits and, it is believed, without
real comprehension as to the effect of
the law. There is reason to believe
that the Legislature intended to amend
the present law only to the extent
OF making taxable transfers by nom
residents of stock in New York cor
poratlons, but the bill goes great
deal further, and involves a sweeping
change in the states policy as to the
securities of non-residents
The Governors emergency message
was based upon two representations
made to the Governor and stated in his
message:
% That the change in the law would
result in an increase to the revenues of
the state.
(Ihls representation might or might not
be true. 1t is believed that as a matter
OF economic policy it would be disas-
trous both to business interests of the
community and to the net revenue re-
ceipts of the state)
(2) That the bill in its amended form
was entirely satisfactory to all who had
appeared before the Legislature in opposi-
ton to the bill
CThe fact that there had been misrepre-
sentatlon as to this was Immediately
called to the attention of the Governor,
and he has fixed April "a, at ~ o'clock
for hearing upon the said bill.)
1t is quite apparent that the result Of
the hasty field strategy incident to this
eleventh-hour legislation is a very i'm
perfect statute, and it is hoped that the
Governor will see fit to exercise his
veto power thereon, because
C) The economic policy involved Is bad
(2) The language of the act is extremely
uncertain.
(3) The proposed law will introduce a
large element of perplexity in the admin
istration of the law.
(4) The bill was passed under an entire
misapprehension, and does not represent
the will of the Legislature in the matter.
eatures <of
The Act
The principal new features of the
bill affecting the taxation of transfers
of property of nonresident decedents
by will, interstate law or gift in con-
temptation of death are as follows:
l. 10 make taxable the stocks, bonds,