The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1921-01-07

but as Well in the marketing OIL iiVe
stock and other produce. Ii neither
of the two first plans referred to is
satisfactory, the third might be adopt
ed. This would be accomplished IL
your body would pass law compel
ing all terminal exchanges to admit
to membership purely mutual concerns
which would make their dlstrlpu-
tons on the so. called patronage bas-
the stock held by patron" In re-
gard to tonnage tax, the governor
said in part: LESS than genera
ton ago only few thousand tons of
iron ore were each year produced IN
Minnesota: now there are produced
more than thirty million tons annual
ly. To-day mining is the second in
dustry of the state.
while the matter of the tsxation
of iron ore on tonnage basis should
not be party or political question,
nevertheless the republican party,
the democratic party. and the nonpar-
tisan league are committed thereto.
The platform upon which | was elect
ed declares for a fair and equitable
tonnage tax.
THE present administration pledg-
es it's CO operation in the enactment
of such a law and as governor l will,
give my approval thereto. Since
1897 iron mines have been assessed
and taxed on an advalorem basis but
meanwhile a number of tonnage tax
measures have been introduced in
various sessions of our legislature.
The three bills appearing to have had
the greatest consideration were meas
ures endeavoring to levy:
First. A tax based on metal
lie content without regard to the
cost of mining.
"Secord. A tax on gross pro-
duction.
Third A tax upon profits
after making certain deductions.
"All of these measures were based
! upon tonnage ami all except the hrst
mentioned were supertaX measures.
| A bill for net profits tax was first
introduced at the general session of
| house similar bill was again in
troduced at the special session of
1919. This bill did not propose tax
| on actual net profits in as much as
proper deductions were not allowed
for in arriving at such net profits
"This bill did not meet the obiec-
! tions and criticisms made against
| the previous bills, mention Of which
| have heretofore made. The passage
of the bill and its veto by Governor
Burnquist are so recent and the at
| tendant circumstances are so familiar
| to you all that further comment
thereon seems unnecessary at this
time Argument is made that iron
ore is a gift of Nature, a natural
heritage of the state and natural re-
source that isl diminished by contin-
ued mining leaving waste land in its
wake. that it should therefore take a
classification different from other
! forms of property which are the re-
suit of toll and that it should bear a
| heavier tax than other property in
order to meet the depletion and dis
| appearance Of such natural wealth.
Severance Tax Suggested.
1T has always seemed fair to me
| ton purposes the gifts of Nature
which the hand of man sewers from
IN. Severance taxes, either
entirely overlooked or avoided in
Minnesota, have elsewhere been put
| into successful operation in order to
reha bilitate Nature for its losses. A
severance tax would place tax on
| iron ore as well as other materials
taken from Mother Earth: as gravel,
metals, sand, mari, clay, peat, limb
| er, stone, gems, and so forth.
| Minnesota Tax commission which is
| a BIZ partisan body and one of the alb
| lest and most important departments
of our state government in submit
| ing it's BIZ enniel report to this legis
! lature discussed various questions
involved in the taxation of iron 'ore
and methods employed in such taxa
! ton throughout the United States.
This authoritative and unprejudiced
document deserves your very
| thoughtful consideration.
After studying this report I have
come to the conclusion that any ton
mage tax imposed upon iron ore un
der any new system established
should be a net profits tax in lieu. of
all other state taxes upon the proper
| ty; accompanied by reduction in
| the percentage of the So called ad-
valorem tax for other purposes. The
advalorem method of taxation should
be retained for local purposes be-
cause if this is not done municipali-
ties which have no income from in
ruiniously affected with regard to
their schools, fire departments, po-
lice departments, and so forth during
periods when mines might be closed.
The gravest question for considera
/ ton in this connection, however, Is
the constitutionality of law provid-
ing for such a tax.
"The question Of the constitution
ality of a net profits tax, l know, will
have the serious consideration of
your judiciary committees. If these
committees are of the opinion that a
reasonable doubt exists as to the
constitutionality of the proposed bill
and if it becomes apparent that the
passage of such a law will lead to
prolonged litigation and tax con-
fusion then certainly some other
means should be adopted to carry out
the obligations of this administration
and of those individual members who
are pledged to support such a meas
ure, even though it should become
necessary to submit to the people a
constitutional amendment that would
give validity to such a law"
Referred To Roads Legisla lion.
| Referring TO roads legislation he
said: Better roads for Minnesota
is one of the great problems in the
development of our agricultural re-
sources.
Transportation of farm produce
and the distribution of commodities by
motor trucks is already an establish
ed system in many parts of the coun-
| fry The juauorratifn Of a Stat q