Evening star., 1934-03-17
UNDERMINING TAX
METHOD IN STATES
GAINS MOMENTUM
Direct and Effective Relief
for Real Estate Move
Widely Desired.
ASSESSMENT OFTEN
DESTROYER OF HOME
Legislation on Subject Being Ad-
vanced in New York, Michigan,
Illinois and Other Sections.
BY VINCENT TUTCHING.


Modernization of State tax meth
DDS appears to be gaining momentum
throughout the country, with thought
crystallizing on direct and effective
tax relief for real estate.
The contention is made that ex-
cessive real estate taxes are respons-
ible for so per cent of the applications
now being made upon the Home Own
ers' Loan Corporation by delinquent
home borrowers for relief. In many
instances, it is reported, the tax item
is the one factor that sta, between
a homes retention or its abandon
ment.
In the national movement to re-
lieve real estate of some of the tax
burden, the National Association of
Real Estate Boards is taking a lead
ing part. Already programs for State
legislation that will provide immediate
relief are being advanced by realtors
in New York, Michigan, Illinois, Con-
necticut and other States.
Scientific Tax Assessing.
Outstanding among features of
many of these State programs are
their insistence on a more scientific
system of assessing taxes on real es-
tate. Some of the programs center
on a shift of certain large costs from
the local governments to the State,
where a wider tax base is provided.
The national realtors body makes
the point that school costs and street
and road costs are two large ele-
ments of local governmental expendi-
ture that could equitably be shifted.
In Illinois, joint legislative and
citizens committee appointed by Gov.
Horner to recommend changes in the
archaic revenue article of the Illinois
constitution, has approved the draft
Of such an amendment, embodying a
proposal to limit taxes on property in
Illinois to l per cent of fair cash
value. On property outside of incor-
porated units, the limit would be
eight-tenths of l per cent. The pro-
posed limitation would exclude debt
payments.
The Chicago Real Estate Board and
the Illinois Association of Real Es-
tate Boards urge enactment of a con-
stitutional limitation of the kind pro-
posed. The proposed amendment, as
drafted by the legislative subcommit-
tee, provides also for limitation on
the amount of bonds that can be
issued to - per cent of the full value
of the property for the next five years,
and 10 per cent thereafter; new State
tax levies outside OF a property tax
must be by two-thirds vote Of the
Legislature, and counties are to get
at least three-fourths of all new State
tax levies. distributed on such basis
as Legislature may determine.
Tax Limitation Amendment.
The Illinois Association of Real Es-
tate Boards is emphasizing at this
time, amendment of the revenue ar
ticle of the constitution to include
tax limitation of l per cent of the
full fair cash value of all property,
real and personal. They ask, further,
that the penalties on back real estate
taxes, up to and including the year
1881, be eliminated and that rea-
sonable time for payment be granted.
A Is per cent reduction in the 1881
assessments for small homes and
small properties in the city of Chicago
is sought in a huge joint case brought
by the Chicago Real Estate Board in
conjunction with owners of $4,000
small properties, the case now being
heard in the County Court.
The New York State Association of
Real Estate Boards has advanced a
10-point program for its State which,
1t is estimated, would equalize real
estate taxes by approximately $780,
000, 1000, in many localities reducing 10
cal property taxes at least one-third.
Nine-tenths of the cost of local gov
ernment in the State is now levied
against real property, irrespective of
its income or use value, Ray Hofford,
executive vice president of the New
York association points out.
The Michigan Real Estate Associ-
alton is urging for its State:
l. That the entire cost of education
be removed from real estate, and be
provided from special State tax reve-
nues, as, for example, retail sales taxes
and liquor taxes.
2. Maintenance Of all streets in
cities and villages out of automobile
gas and weight tax revenues, with a
redistribution of these revenues to To-
cal communities in greater degree
than is now done, in order that real
estate may be further relieved of
street debt-service costs and mainte-
nance charges.
8. Establishment of income value as
(ContinlIed on Second Pape0