The Coconino sun., 1923-10-26
REVIEW OF THE MINE
TAXATION SITUATION
(Contributed)

Minnesota has partially revised its
tax system by the adoption of the
occupational tax law which grew out
of the necessity of securing fairer
tax returns from the Minnesota iron
mines.
There remains in Minnesota 1,400,-
100000 tons of iron ore as known un-
mined iron ore reserves. 1t is assess
ed at fifty per cent of its full value.
Other classes of property are assessed
at forty per cent, thirty-three and
one-third percent, and twenty per
cent, in eadM case the percentages of
full value and all in accordance with
provisions of law.
How Taxable Values of Iron Ores
Are Kept Down
Every spring producers of iron ore
from Minnesota and from other iron
ore producing states of the Lake Su-
perior district meet at Cleveland,
Ohio, and there agree upon the price
of iron ore to be delivered at Cleve-
land during the season. Under the
dominating influence of the steel cor
poration the price is finally set, US
ually at about $5.25 per ton. This
is the basic price necessarily taken by
the Minnesota tax commission for val
uations of Minnesota iron ore re
serves for taxation purposes.
After deducting from the fixed
price of say $5.25 the costs of min
ing, transportation and other items
chargeable to costs of delivering the
ore at Cleveland, the balance called
profit is applied IN estimating values
of iron ore tonnage reserves IN MIN
nesota, and after making allowance
for the number OF years required IN
mining out ore tonnage, a present
worth figure is obtained, fifty per cent
of which is 20.5 cents per ton or
thereabout, the taxation value of a
ton of ore in the ground.
To indicate roughly the unfairness
of this low value it is necessary only
to take note of the known fact that
this same ton of ore, valued at 200
cents for taxation purposes, when
mined, shipped and through reduction
and manufacturing processes convert
ed into marketable forms, produces a
net profit Of $14.00 to the operating
company. But these greater profits
from iron ores can not be taken by
the tax commission as factors in esti-
mating values of iron ore tonnages OF
Minnesota for taxation purposes.
Occupational Tax Remedy
To free itself from these CONNER
cial and legal barriers to fair taxa
ton of iren ores Minnesota devised
and adopted its occupational tax ap-
plicable to the iron ores, this being a
tax in addition to the tax on iron ore
Heretofore obtaining but which lat
ter tax, nevertheless, is retained.
Like the commerce of iron ore, de-
signed to keep down the taxable val
ues of iron ores of Minnesota and OF
other iron ore producing states, the
commerce of copper has been designed
to keep down the taxable values OF
copper mines of Arizona and of other
states. The taxable values of copper
mines are kept down by keeping down
the prices paid to producing mines fol-
the crude blister copper. This price
ranges around Is cents per pound and
is largely dictated by directors of cop
per mines articulating with directors
of banks, all more or less interested
in the manufacture of copper and its
alloys and the marketing thereof
wherein lies the greatest profit II
copper commerce.
In Arizona the tax commission de-
ducts from the said market value of
say Is cents per pound, all costs OF
producing a pound of copper, and the
net balance which may be from l tc
5 cents is taken as factor In com
putting the taxable values of produc-