New Ulm review., 1921-11-30
OF
GRADED TAX LAW |
PITTSBURGH'S PLAN BENEFITS
REALTY OWNERS. HITS
sPECULAToRs.
STIMULATES BUILDING WORK,
CUTS DOWN PRICE OF
VACANT LAND.

Frequent reference has been made to
Pittsburgh's Graded Tax Law. In
1918 a law was enacted in the state Of
Pennsylvania which permits cities Of
the second class to reduce 10 per cent
each three years, for period of fifteen
years, the tax on buildings, as com
pared with the tax on land. Pitts
burgh, soon after the passage Of this
law, took advantage of the act and
adopted the graded tax" Under this
law, Pittsburgh's rate for 1921 was
20 per cent on land and A per cent on
buildings. In1922 another 10 per cent
will be deducted from buildings, also
10 per cent in 1925. On and after
1895, the tax rate on buildings in Pitts
burgh will be one-half of the tax on
land values.
Helps Build Up City.
This law has proven beneficial. From
1914 to 1920, Pittsburgh spent for new
buildings per l 900 Of increased popula-
tion from rs to ESQ per cent more than
any other city in America. At the
same time, the higher tax on land has
stopped land speculation and imitation,
which had formerly seriously hampered
real growth as manufacturing center
by driving new plants to other cities
having lower land values.
The Pittsburgh method Of taxation
is being urged throughout the state of
Pennsylvania and doubtless the legis-
lature of Pennsylvania will, in time,
permit still further reduction of taxes
on improvements. One great advant-
age of the 'sgraded tax" is it's conser-
vative application by changing the
rate slowly. The real estate values
are not disturbed to such an extent as
to cause damage. Dealers in real
estate, owners of real estate and pro-
spective purchasers of real estate know
in advance what to expect from the
shift in the tax and values are gradual
ly adjusted accordingly.
Very Satisfactorily.
Pittsburgh business men are: so
thoroughly convinced that shifting
taxes from buildings to land values is
beneficial to business, that there is no
danger of the city's going back to it's
old method of taxation. Even real
estate men favor the tax. 1t will
doubtless surprise many people to
know that splendid system of taxa
tion exists in that boss ridden city of
Pittsburgh located in that stronghold
of political reaction the state Of
Pennsylvania.
! However it came about, the city is
beneftting sgreatly from the taxation
system in use and it has the enthus-
iastic support Of all classes of citizens,
except, perhaps, the owners of vacant
land. They constitute much less than
5per cent of the population Of any city,
so the system measures up to that
fundamental axiom of democracy
the greatest good for the greatest num-
ber. III
Stopped Land Price Boosting.
| The Graded Tax Law was much
needed, as owing to wild speculation,
land values in Pittsburgh had been
boosted beyond all reason and were
driving new plants away from the city.
1t was thought that this law would
stimulate building and would have a
tendency to prevent further land in
fation, all Of which has been borne out
by experience.
Most cities, during the postwar
period, had considerable land imitation,
while Pittsburgh land values remained
stationary and the land values of COM
petitive cities are now equal to or
higher than those in Pittsburgh, which
will insure Pittsburgh a greater growth
during the present decade than it en-.
joyed during the last 10 years, owing
to it's former prohibitive land values.
Aol 6C 11lluSu SSOdCcS, llSlu 1llIdCC lot
several generations, with fixed mo
sale" policy, are now offered for sale at
reasonable prices.
More Building Permits.
The benefit Of the Graded Tax Law
is most clearly demonstrated by the
stimulation it has given building, and
when selfish interests attempted its
repeal, the Pittsburgh Chamber Of
Commerce and all other civic bodies
came to it's defense.
Owing to the stimulus Of this law,
the amount Of Pittsburgh building per-
mits per 1000 Of increased population,
from 1914 to 1920 inclusive, exceeded
Those Of her competitive cities as
| follows: -s5
Is per cent more than New York.
81 per cent more than St. Louis.
66 per cent more than Philad delphia.
66'per cent more than Cleveland.
81 per cent more than Buffalo.
186per cent more than Detroit.
4 238 Der cent more Than Ralt;rnnro &