Evening star., 1922-05-18
Rate by MaiI-Payable in Advance.
MARYLAND and Virginia.
Intangibles Tax High Enough.


tangibles &c % per cent; forbids the
Commissioners to lower, but authorizes
them 20 increase this rate, and pro-
vides superfiuously and sardonically
that this rate shall not be raised
higher than the tax rate on realty.
The District has been wisely placed
in the CLASH of states which apply a
low rate to large volume of intan-
gibles, and no Commissioners will ever
take it out of this class. Congress,
after full discussion and deliberation,
placed this rate at mills. the wise
and fair rate in comparison with the
rates of the States in this class. Con-
gress row proposes, without discus
sion or deliberation, to increase this
rate to mills, the highest in the class
of states in which the District falls,
and to apply iris maximum rate to
a wider range os intangibles than are
taxed in any other state of the Dis
trict's class. Our law taxes all credits,
without any deduction for debts, and
all loans and investments except the
stock Of District Corporations already
taxed.
The states in taxing intangibles are
divided into few distinct classifca-
tons.
1. The full properly tax rate is ap-
piled to credits and Sther intangibles
as if they were property. Results:
Absolute failure of tax as a revenue
producer. Complete success as a per-
jury producer, through compulsory
listing system under which the tax
payer virtually fixes his own tax. Law
contemptuously disregarded by bulk
of taxpayers and not uniformly en-
forced. Gross injustice to conscien-
tious few who try to obey tn. law and
in double taxation of the same prop
erty necessarily involved in this tax.
This discredited system stiD prevails
nominally and with many Variations
in most of the states. Its breakdown
is fully discussed in the report of the
New York state tax committee Q916,
pages 81 ct seq. and Al ct seq.
2. Certain states, recognizing the
element of double taxation involved in
taxation of most intangibles, reduce to,
a very low figure the rate of taxation
levied upon intangibles and apply this
low rate only to few of the different
classes of intangibles, no two states
selecting the same intangibles for this
taxation.
Since intangibles are still treated
and taxed as property, the reduction
of the rate does not eliminate the
property, but reduces it to a minimum.
To the extent that the taxpayer con-
ttnues under legal compulsion to make
return under oath Of his intangibles,
to that extent the evil of the listing,
self-taxing system as a perjury pro-
tina extent that the few iotangibles
selected for taxation in any state can
be taxed at the source, or in connection
with the making of some official rec
ora concerning them which prevents
concealment, this evil is eliminated or
reduced to minimum. Since there
are many who will endure this double
taxation Of credits if the tax is very
ligaG, but will evade the heavier tax,
the low-rate tax is more successful as
a revenue producer, in the equitable
distribution Of the tax burden and in
Diminishing fragrant tax lodging.
The following states in 1917, when
the intangibles tax was last locally
discussed, imposed a low fat rate upon
.ntangibles, with numerous and vary
ing exemptions: Maryland, Pennsyl-
vania, Minnesota, Rhode Island and
Iowa District of Columbia after July
1, 1910. Several other states have
been added to this classification since
1917, including North Dakota and
kentucky.
The following states, under a regis
tration plan, imposed in the same year
low specific tax upon the face value
Of certain debts, exempting them from
other taxation: Connecticut and New
York. The following states imposed
a low-rate income tax on certain in-
tangibles in lieu Of a tax on the value
OF the intangibles: Wisconsin and
Massa chusetts.
3. Some Of the states recosrized
SO completely the double taxation in
volved in a tax on intangibles, and
the perjury-promoting evil of a COM
pulsory listing system, attempting to
bring to light invisible property by
confession Of the taxpayer, and the
absolute failure as a revenue producer
Of this tax, that they eliminated en-
tfrely the general tax ON the intangi-
bles Of the individual, and in lieu
thereof in certain instances las in the
District Of Columbia) imposed specific
taxes upon certain corporations, or to
o9set the lighter personally tax raised
b the limit the tax on realty. These
ata$es were Delaware, Idaho, Wash
iAgton and, until July 1, 1917, the Dis.
trict Of Columbia.
The District In 1920 raised from its
tex on intangibles about q million dol
lars; from its tax ON tangible per.
sonalty, 81, SOC, 500, and from its gross
earnings tax on certain corporations
In lieu Of q personal tax, $1,200 900.
In that year Washington's total per.
sonal tax per capita was greater than
that Of such cities as Milwaukee, Chi
csso, indianapolis, Louisville, Atlanta,
Baltimore, Jersey City, St. Louis and
Philadelphia. Is not its personal tax
burden heavy enoughf Should it's In
TANGIBLE tax burden be increased two.