The evening herald. [volume] (Albuquerque, New Mexico) 1914-1922, 1920-10-19

outlined7 Let me take the law apart
70 you can look at It and understand
Il. The miscellaneous and admins
trative provisions are not important
here and are not being attacked. 20
I ehall disregard them. The inquiry
II. what system was devised 60 deter
mino mineral valuef"
(Now this last element OF value,
the mineral value OF the land. Is what
the output" law deals with. Let u
see how that value was determined
In 1914.) TO be sure one could guess
that n mineral vein continued. that
n coal seam continues workable out
Il must be a mere guess at the best.
But OF course no one can predict
whether the price OF the product, the
market, or the price OF labor and
material would romain at n level such
as 10 maxi extraction possible.
Tho law says every operating
owner shall make "a return showing
the gross production of minerals
which is set forth in tons. pounds or
ounces, and, on the basis OF known
market prices, Is easily put In the
form OF dollars. The owner also
makes n statement OF production OK
penscs which is subject to verified
ton through examination OF his.
books. These expenses are deducted
from The gross output, n the result
Is The so-callod net output which is
taken and considered as the mineral
value OF the land.
Now tho ordinary merchant or
manufacturer or land or cattle owner
says, because he does not understand;
why should mines be assessed only
on their net profits. while I pay on
the value OF what / have. whether It
brings me any net income or not2'
The answer TO this inquiry or state
mont Is perfectly plain, and 1 shall
try to state II clearly;
In the first place. net output and
net Income, OF which tho merchant
and others are thinking. are not the
Same thing ut all. Broadly or theor-
cticnlly speaking. the only deductions
allowable against gross output are
the expenses paid for the extraction,
transportation and sale OF the min
er0l. In other words the net output
In N fictitious net created by the law.
and just as difforent from net In
come as night Is from day. Now to
explain this In a practical way: The
law says TO us that only cost OF eX-
traction. transportation and sale shall
be deducted from the gross output.
and then goes further and specifies
that certain items shall not be de-
Quoted. For instance, the law spec
files, among other things. the follow
ing as not allowable In the way OF de-
ductions: Expenditures fot mnchin-
cry, improvements. appliances for
mining, reduction work, coke ovens
mills, transportation facilities and the.
like: salaries OF persons not actually
working In the mines or transporting
or selling tho products. Further than
this, by Interpretations and rulings
of the State Tax commission, many.
other items OF tho same class haze.
boon excluded. For example:
]. Repairs Of BUILDING above.
ground.
, 2. Timber for use above ground.
.. Yard ana surface work.
4. Insurance.
8. Depreciation.
o. Taxes.
z. Reconstruction.
s. General office expenses. 2
.. Compensation insurance.
10. Compensation claims paid.
II. Contingency OF reserve fund.
i2. Deficit In boarding house nc
counts.
10. Rental OF power plant.
II. Interest, n many other items,
Now the ordinary merchant or cat
tleman or manufacturer, viii. Of
course. deduct many, II not all OF
these items, and arrive at his net In
come. but a miner cannot. under the
law, deduct them to fix his net out
put. So Il Is I say TO you that net
output is a fictitious net, ms differ
cnt from book net as night Is from