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


day. 10 Illustrate a little further;
/ know Of ono coni-mining company
whose report 10 the tax commission
showed n gross output OF over $780,
900. According TO his books, which
wero verified, he had no net income,
but, on the contrary. "A loss for he
years business OF approximately SEQ
poo. However. after disallowing the
Items Of deduction such as Indicated.
his net output amounted to $50. 900.
That h., there vas n difference Of
$4,000 between tho net output and
the net income, on a gross business of
$3.50. 900.
Now for tho second reason or an
swer to the question OF the ordinary
merchant. Let me state Il concisely
first. The not output represents on
~ tho mineral value OF tho mine and
all the other elements OF value. that
is, improvements, personal properly,
and the surface OF the land are taxed
In addition TO the mineral value.
Strange as II may seem, / don't be-
licve one person In 100 understands
this very simple thing. To illustrate,
let me take n concrete example: The
assessment OF one company for this
year consists OF the following items:
Surface value OF lands, only part OF
which are mineral ...S 77,9b2.O0
improvements .''....., lbS,fl9.OO
Total. s2si,g7l.00
Net output ............ 500, 100000
Grand total, ......S2S1,67 l,0O
The different elements OF value are
plainly seen by this example, and Il
Will also be seen that the net output
represents less than ono-third OF the
total assessment Of the given com
pany.
Stated In another why, the net out
put fixes only that uncertain element
OF value, the mineral value, or the
value of that thing that cannot be
seen, cannot DO touched, a secret hid
don in tho earth. IL substitutes a
scientific and economically sound
method OF determining mineral val
for the bold guess of the assessor
to which / have referred.
Now II the merchant and land and
cattle owner were taxed on what they
have In property, and tho mines. on
what they make, there would certain
ly be good ground for a revolution.
But this Is not the law, and you don't
need TO take my word FOR Il. Read
IL. The mines are really taxed on
what the town, just as the merchant
or the cattlcmnn H., the only differ
cDcc being that one additional item
OF property. or element OF value. that
II. "'mincral value" is valued In a
different way. Tho mineral value In
"A mine Is comparable with the good
will Of a merchant or the franchise
OF n utility.
Would a merchant like to Lave the
assessor guess at the value OF tho
good will In his business? Would
not a merchants net profits mcasur
that good will hcttcry To be sure,
good viii and franchises are not
taxed but r they not uncertain
elements Of valuei and II you buy
out a merchant, don't you pay FOR
thcm; and, before you buy him out,
YOU want to know what he Is making.
and from that, you can tell a good
deal as To- the value Of the good will
hi his business.
Now n 1t les understood that net
output and net income are not one
and thd9same thing. but vastly differ
ont, and II It further understood thai
the mine output Law attempts to fix
only one element of the value Of
mine property, which IL usually less
than n half OF all the value. the
unfnirncss and misleading character
Of the attack being made against the
law becomes at ono apparent. IL
all tho taxpayers understood. as they
should understand, that the mine out
put law attempts only to fix II meth
cd of valuation OF ono element of
value In mining property, and that
all other property is assessed Just
the same as theirs, there certainly
can be no great political Issue in
Volvrd.
Now there is some difference of
opinion as to whether or not the net
output law. in It's present form, Is
quite correct, various contentious
being made regarding what are the
proper allowable deductions. whether
the net output or gross output should
be used; whether II should be a null
tiplc or the net, and other contro-
versios. However, this Is an
omic issue 10 be solved by experts,
and. In no sense. n political issue.
One of the political questions or is
sucH which ie presented by this law
Is that question ns to whether or not
Il Is "a progressive law. modern, and
IN