Lapas attēli

P. W. Meldrim, of Georgia :

I am sorry I was not present when the report of the committee was read. I may say, sir, that the committee has no objection to a recommittal of this matter if by recommittal any useful purpose may be subserved. With reference to the objection raised that the Association should not deal with an economic question, it must be remembered that the question was referred to your committee by resolution of this body; and, therefore, it became the duty of the committee to consider and report upon it. The resolution referred to the committee, so far as it is relevant to the matter now before us, was: “ That state taxation should be upon property actually within the state only.” Now mark the proposition submitted : “ That state taxation should be upon property actually within the state only." No reference was intended to taxation upon real estate, for real estate is necessarily governed by the law of situs. Therefore, the question before your committee was this: Should the committee recommend, as proposed by the resolution, that taxation on personal property should only be in accordance with the law of the place where the personal property might be found ? The general law is that personalty follows the person, and rather than recommend a radical change we deemed it the better policy to adhere to the old rule. The evil sought to be remedied was that of the tax payer putting his personal property, particularly securities, out of the jurisdiction of the state and the reach of the tax gatherer. To recommend that “state taxation should be upon property actually within the state only” is to require the tax collector to locate the personalty in the state. If the correct view be that the tax gatherer shall lose sight of the tax payer, and shall seek all over the American union for securities that may be hidden, then let this Association refuse to adopt the report of the committee. If, on the other hand, the view of your committee be correct that personal property follows the person, and that the state has jurisdiction for tax purposes wherever it has jurisdiction over the person of the tax payer,

then let the Association so declare and adopt the report of the committee.

There is no objection on the part of the committee to having the subject matter recommitted to it, but it is doubtful if, under the terms of the resolution, we can do anything better than we have done.

Fabius H. Busbee, of North Carolina :

The difficulty seems to be that the committee has attempted to state in a few sentences the law governing the situs of personal property for taxation, while it would require pages to make an accurate statement, however condensed. Certain kinds of personal property naturally follow the person of the owner. Other personal property has a situs of its own. If the Chairman owned in Missouri a herd of cattle which had never been out of the state, would not such personal property be taxable in Missouri instead of in the state of the residence of the owner? If he owned a share of stock, personal property, in a manufacturing plant in another state, would not the property be taxable where it was located, and not merely where the owner of the share resided ?

In the broad statement of the report, therefore, all sorts of inconsistencies will arise. Without going into the infinite ramification of the doctrine of the taxation of personal property, I hope this part of the report will be again referred to

, the committee for further consideration.

James 0. Crosby, of Iowa :

The gentleman who has preceded me has in part advanced the idea that I wished to advance. There are two kinds of personal property, goods and chattels, which would properly come under this third section. State taxation should be placed upon the goods and chattels within the state, but it is a general rule, I believe, that so far as moneys and credits are concerned the situs of taxation is the residence of the owner. It seems to me that this recoinmendation is, therefore, somewhat untrue. We should recognize the two kinds of personal

property—that which consists of goods and chattels on the one hand, and on the other moneys and credits, which follow the residence of the owner.

Robert D. Benedict, of New York:

May I say for the information of the Association that the resolution as referred to the committee was that state taxation should be upon property actually within the state only. The committee considered that, and stated as its determination that “ we cannot recommend that state taxation should be upon property actually within the state only.” Now the motion to recommit the third section of the report would carry back to the committee a reconsideration of that proposition. I do not believe that this Association will differ substantially on that part of the report of the committee. The questions which have been discussed here seem to arise on the subsequent article and clause of the third proposition, and if those were referred back to the committee I do not think there would be any objection.

Fabius H. Busbee :

Could you not strike out the two clauses, then, which follow that?

A. J. McCrary, of New York :

I am responsible for the wording of this resolution-not in the sense that some have discussed it, but it was worded in the form that it is for the reason that in the courts of the State of New York to-day there are questions being discussed relating to the taxation of property belonging to corporations, property which is absolutely taxable and is absolutely taxed in other jurisdictions, in other states, property belonging to a corporation which never had its situs within the State of New York. Therefore the question arose, and is now before the Court of Appeals of the State of New York, whether a corporation which has property in half a dozen different states, which property is now being taxed by each of those several states, shall also be taxed in the State of New York for the entire property covered by its corporate franchise. The purpose of this resolution was simply to fix the character of property which is not at any time within the situs of the owner, but is used exclusively within and is entirely within some other state, while the owner of the property has its situs in the State of New York. Now as the law has been administered—the state in which the property is located and where it is used bas taxed the property, and the State of New York taxes the owner with its whole property in New York; thus the same property is taxed in the several states where located and also taxed in New York. It is property which never was and never will be in the State of New York. It is only necessary to state that proposition and every honest-dealing man will realize the injustice of it. I have therefore great faith that when the real spirit and purpose of this resolution is understood the language used in it will not be found subject to the criticism made upon it. it was intended that this property should be taxed in the state where it is located. It is already taxed there, and if it can, therefore, by virtue of the situs of the owner being in the State of New York, be taxed also in New York, then it is double taxation.

James 0. Crosby :

May I ask the last speaker a question? This says that personal property shall be taxed under the laws of the state of the owner. I live in Iowa. Suppose I buy a mule in Missouri, shall I go back to Iowa and leave that mule here to be taxed under the State of Missouri?

A. J. McCrary :

I am not responsible for the report and the mule comes under that. I am speaking of the resolution now.

W. B. Swaney:

It strikes me that this resolution is referred to the wrong committee. The evil we are attempting to correct by this resolution is one that belongs to the Committee on Uniform State Laws and should be referred to that committee. Το

illustrate: This evil arose a few years ago when the great mill owners were contemplating removing their manufacturing establishments to the South, and the question of organizing new corporations and dividing their property and their capital arose in a very pointed way. We had the evil pointed out in Ten

and we cured it. The question is one of taxing intangible property. The question here is whether or not personal property should be taxed according to the laws of the state in which that property is situated, and the committee reports that it does not recommend the adoption of that resolution. In other words, that resolution would eliminate the question of intangible property. In Tennessee we had no law in reference to foreign corporations which protected them. They were subject at that time to double taxation to the full extent of their capital stock under the general law. We provided that when foreign corporations come to Tennessee they shall only be taxed pro rata with the actual value of the property brought into the state, thereby dividing the question of the intangible property that they brought into the state.

I think this would be corrected by a reference of this part of the report to the Committee on Uniform State Laws.

P. W. Meldrim :

In order to avoid unnecessary discussion, if the gentleman who moved to recommit will permit it I will say that it will be agreeable to the committee to strike out the two clauses to which objection has been made, as all we desired to do was to reach a conclusion.

Frederick N. Judson :

I do not believe in mutilating a report of a committee. The real difficulty here is, as stated by the gentleman from North Carolina, that the committee has undertaken to deal with a complicated economic question that has perplexed economists growing out of conflicting sovereignties in exercising the law of taxation, and the subject should therefore be considered by the Committee on Uniform State Laws. I

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