The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1921-08-20
Billions Escape
Taxation
Exemption Of Certain Glasses
of Securities From Taxation
Increases Burden of Gen
eral Public

Chicago, ILL.,, Aug. ia deter
mined effort to end the tax eX-
emption Of certain classes Of securl-
ties has been started by the Chicago
Mortgage Bankers Association.
consisting of concerns in Chicago
lending money on city real estate
This organization began its ef-
forts when the recent National Con-
vention Of Real Estate Boards was
held here last month. That con-
vention adopted resolutions direct
| ed against the further extension or
the tax exemption privilege. and
the Chicago organization has en-
listed a large number Of real es-
tate men throughout the country
in it's campaign.
At the real estate convention the
KEYNOTE was sounded by Melvin A.
Taylor, noted Chicago banker,
in an address on The Menace or
Economic Fallacies" Mr.. Traylor
asserted that, including Liberty
Bonds, there are over thirty billions
Of dollars of tax free securities
afloat in the country. These, ne
said, are largely represented py
municipal securities. and appeal TO
the very wealthy, resulting IN keep
inc general taxation high and re-
stricting productive industry. he
charged also that much municipal
extravaganza is due to the tax eX-
emntion feature Of municipal Sc
curities.
The Chicago Mortgage Bankers
Association charges that tax eX-
emption causes the diversion or
large amounts of money by estates
and individuals with large incomes
from building enterprises to those
which are inert, so far as produc-
tive industry is concerned. 1t
charges the building shortage to
be due largely to the purchase or
tax free securities, and that as
result rents and taxes upon the
general public are increased.
A protest against the further
ance of tax exemption has been sent
by the assication to every member
of Congress and the foundation of
a national organization Of city
mortgage loan men has been form
ed. 1t is purposed through this
national organization to demon
strate that the extension of the
tax exemption privilege means eX-
emption for the wealthy only and
greater taxation for the general
public; higher rents through less
building; the continuance Of the
high living cost and unemployment
because of less capital for produc-
tive industry. and general hating
Of Industrial development.
Attention is directed toward
farm loan bank bonds and joint
stock land bank bonds, now tax ex-
|empt, as illustrations Of the dan
gers of extension of the tax exemp-
tion privilege and also as class leg
Iislation. If this practice continues
lit is feared other classes Of the
people will ask like privileges. The
organization will seek to demon
strate to the farmers that they are
ultimately the real sufferers, be-
cause Of the resultant slowing down
fef industry and the consequent re-
striction Of markets for farm pro-
ducts, together with the higher
taxes they must pay.
Were the tax exemption privi-
1ege entirely withdrawn, said
George H. Traylor president Of the
Chicago Mortgage Bankers Asso-
citation, there would be approx
mately sixteen billions Of dollars,
aside from Liberty Bonds. amen
able to taxation. This. at the nor
NAL income tax rate, would yield
nearly O billion dollars annually
and would relieve the people Of
huge tax burden and divert amaz-
ingly large sums from non-produc-
tive to productive uses.
IF the tax exemption privilege ls
curtailed, then increasingly larger
sums will be available for taxa
ton, which will at once reduce the
general burden and enable indus
try to obtain the capital it so
urgently needs. If, however, the
privilege is extended, we shall have.
as Mr.. Traylor points out, greater
municipal extravaganza, useless
public work and inert large for
tunes. which will mean the contin-
uance Of high taxes, little building
construction and high prices. We
invite the cooperation Of all en-
lightened organizations to help end
this iniquitous economic absurdity."