The Bozeman courier. (Bozeman, Mont.) 1919-1954, 1924-06-18

put SquaTely before the supreme court
yesterday in an attempt to recover a
Of $3,449.99 in taxes paid under
protest to the state treasurer after
the state board of equalization had
refused to permit the company to de-
duct their property taxes and insur-
ance on their smelters in Anaconda
and Great Falls from the met pro-
ceeds" Of the Nettie and Butte Hill
mines.
Dan'yl KiIly SEE, SEE He
The declaration that mining COM
panies might deduct every cost of
operation and neither the state legis
lature nor the board of equalization
can place any limitation upon this
rule" was made by Attorney Dan
Kelly in submitting the cOmpany's
case Tuesday morning.
Answering his contention, Attorney
General Wellington D. Rankin replied
that his argument would hold good
only if the law, and the constitutional
provision designating met proceeds
as a basis for computing taxes, Were
interpreted to mean 'net profits"
Would Upset Old Methods
He pointed out that the present
basis of figuring met proceeds" was
one of long standing and no innOva,
ton Of the present administration.
"The actual cost of extracting the
metals and minerals from the ore
we're declared by the attorney general
TO be the only legally deductible items
in arriving at IT, ret proceeds of a
mine.
"This brings Us to the question, he
! continued, care taxes and insurance
paid upon the reduction mill or works
a part of the actual cost of reduction
or extracting the metals and minerals
from the ore?
at is evident shat the legislature
did not intend that every conceivable
item Of expense connected with the Op-
Grafton and ownership OF the reduc-
ton works should be imputed to its
product and considered as a part Of
the cost of reduction.
"The taxes paid on the reduction
works might be termed an annual fem
Of actual cost of ownership Of hat
property.
"The property so protected and
owned was a wholly separate and in.
de eHdent specie of taxable property
than that known as net proceeds Of
mines"
"The items of taxes and insurance
premiums paid represent no value in
the raw material or of its manufac
tured product contributed nothing to.
ward the acquisition of the raw ma
erial or it's manufacture into the mar
ketable product, and their cost cannot
! in any manner be accounted for in tn,
: value of the product and therefore the
l cost of said insurance and taxes /:
not an actual cost of reduction. AL
u other things being equal, the actua
d cost Of extracting the minerals ant
I metals from the ore would be tn,
/ same whether done in an actual o
y uninsured, or a taxable or tax-exemp
Il reduction works"
Cites Legislatures Rule
y Cor+1--~ A. Do~T-:- o.-IIo
that the legislature enumerated VIVA
II were proper deductions and did no
! include specifically taxes and insu1
ance on the reduction works or smelt
ers, which he declared strongly ir
d~icates that these items were Intend
ed t. be excluded"
The controversy before the cou1
arose when the state board of equal
s zatiOn fixed the rot proceeds of I'll
Butte Hill mine for the year endin
May 81, 1923, to be $2,978. 742.68 ar
pit assessed a license tax OF s44,6821
ly and Nettie's proceeds to be S253,640.z
and it's license tax $3,8O5.60, on Il
in basis Of one and one-half per cent
Of the net proceeds.
ed In its report the company sougl
n to deduct s~15O,685.85 as. taxes paid
o. the reduction works. and s70,622.
he for fire insurance from the Butte H
gross yield and SZ.136.1O in taxes al
IS s 1,554.41 in insurance from the Nett
ID yield. The board refused to allC
vs. these deductions and the cOmpal
ob- paid the state treasurer S41 ,362.51 U
conditionally and S3,449.99 und
protest.
TO