The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1923-04-26
TAXATION OF TAILINGS
RELATION TO THE MINE
INTERESTING QUESTIONS TO BE
DECIDED BY THE U. S.
SUPREME COURT.
CE. & NJ. Journal-Press

taxation to be considered part of the
mine from rich the ore that contained
it has been extracted or is it personal
property distinct and apart from the
mine? Out in Utah the Utah Copper
company and the officials of Beaver
county advocate the first theory
whereas the South Utah Mines 81
Smelter company ana salt Lake coun-
ty contend for the contrary view. The
L. tab copper mine is in Salt Lake
county; it is protesting taxes levied
on the assumption that the failing
from its mills at Garfield is personal
property "a term that includes all
tangible assets other than land or
real estate and permanent buildings
or other structures on the lands.
Warehouse supplies and equipment,
stocks of coal cement and other
commodities are classified as person
a. The South Utah company owns
copper mines at Newhouse. in Beaver
county and is protesting taxes levied
on the assumption that failing from
its old concentration is part of the mi
ming property
Utah Case
The South Utah case was argued
before the supreme court at Washing
ton last week and the Utah Copper |
case is now before the u. $. circuit |
court of appeals. The circumstances |
Of the two suits are these The South /
Utah company accumulated about
100000 tons of copper bearing failing |
at Newhouse prior to 1914. since which |
time nothing has been done on COM
pany account. In 1918 the Utah Leas- /
ing company erected a notaton plant /
to rework the dump and with copper
selling at 26c netted $l2O5i7. In ac-
cordance with the state law providing
that 81 mining company shall pay a
tax based on three times the value of
the net proceeds. Beaver county.
through the state board of equaliza-
ton, levied a tax on S361,64t against
the South Utah mine. The mining
company contended that the failing
was separate and distinct from the
mine and that proceeds from working
it could not be construed as proceeds
from the mine. The failing had in eff {
feet become personal property and
the leasing company had become own
er of such portion of the dump as it /
treated. 1t was argued that the tail {
ing was comparable to a like quantity
of sand used for making concrete. !
Utah Copper Contention.
These contentious connicted how
ever W ithvarious decisions that had
hoo 81, ]
Copper company in which the courts
had supported the view that for pur-
poses of taxation the failing from the
mills at Garfield is still part of the :
mine at Bingham from which the ore
that produced it originally came. The
sasessor of salt Lake county in 1917 ,
had placed valuation of many mil n
lions of dollars on the huge dumps !
below the Magma and Arthur mills:
these the mining company admits
will in all probability be retreated for p
a substantial profit and are today of a
great value. The company maintain
ed, however that the failing for pur- v
poses Of taxation should be treated s.
exactly as if it were ore in the mine. d
md that the tax on three times the =
ret income paid by each company f,
zach year included any tax due on the c.
ailing. The salt Lake county as
lessor argued that as soon as the ore GO
vas removed from the mine IL became
PERSONAL property and was subject to 20
ak as such. N
A further question raised in the
ase is whether Utah's constitutional
amendment providing for the basing
If the assessment levied against
nine on a multiple of net proceeds for
given year is in conflict with the ~
ederal constitution. A number of ~
ther states use similar methods of h,
rriving at a basis for taxation. so OF
hat the decision in the case will be ls
# widespread interest if the supreme .,
curt elects to determine this issue. on
NE court may decide the question of ST
onstitutionahty or it may settle the to
nit ON the other issue only. ~ y,
A Complicated Question. of
The question as to whether failing 5;
hat has passed through a mill should b'
tin be considered. for taxation. as %
eing virtually part of the ore in the
nine offers an inviting opportunity b.
or those who enjoy ponderous, even
futile, speculation. What of ore
ewly delivered at the mills or ON the
nine dump; or broken ore in the
tope? Suppose that the failing We're lin
for road material Would
then be taxable as part of the mine Ii
i as personal property on the 9TH ~,
D. hand, what of the concentrate. and
he blister copper? When. if at all.
oes the valuable product become tax pc
bic as personal property and not as ~,
art of the mine? The contention. OF W
curse. disappears if the phrase FOR 10
imposes of taxation" is deleted A ~
nan owns an automobile which he All
'ould not think of selling for $1,000. hi
mt he will try to convince the tax du
olector that it is worth about 5000 Ia
or purposes of taxation. 80