TAX. as well as in some cases to shift the burden of the tax from the borrower to the lender. The tax in its present form is also criticised on the ground of its frequent evasion. The general property tax, while practicable for a new, homogeneous, agricultural country, be- comes objectionable in a more highly developed community owing to the escape of personalty, which has grown more rapidly in value than real property. The legal exemption of intan- gible personal property has been advocated (notably by the JIassachusetts Tax Commission of ISO") because of its practical escape under present conditions and because it is claimed to be usuallj' nothing but an evidence of ownership or of an interest in tangible property already taxed. The proposal to exempt intangible per- sonal property has never met with the ap- proval of the farmers or owners of rural prop- erty, imless it is accompanied by some means of reaching the property or income of which the intangible personal property is the title or evi- dence of ownership. There are also advocates of the exemption of taxes on improvements on land as well as adherents of a single tax on land values that will absorb the whole value of the land. See Single T.x. In connection with the general property tax, many of the Southern States also depend upon a number of license or privilege taxes upon vari- ous forms of business, exhibitions, etc., and in 1901 a special committee of the Senate of Cali- fornia advocated like taxes for that State. In the South the tax is not graduated, but is usually a fi.xed charge, and according to Seligman {Es- says in Taxation) is the natural result of the economic constitution of the South in the past. The aristocratic landed interest did not desire to ta.x themselves by a land or poll (slave) tax, but attempted to shift the burden in colonial days by taxing imports and exports, and, after the adoption of the Constitvition of the United States, by levying business taxes or licenses. A few States le'y an income tax, in some cases instead of the general property tax, in others in connection with it. The income tax law of Massachusetts has survived from colonial days. It exempts incomes under $2000. taxing only the excess, and exempts also the income from property already taxed. It is laxly admin- istered: There are also income taxes, or, as they are sometimes known, occupation ta.es, in Louisi- ana, Pennsylvania, Virginia, North Carolina, and South Carolina. The assessment of the property of corpora- tions by local bodies under the general property tax has everywhere been found to be inadequate, and the expedient has commonly been resorted to of assessing the property of such corporations by a State board instead of by local assessors. Corporations are taxed, however, on another basis than that of the value of their property. According to Professor Seligman, the basis of taxing corporations in the United States has been: (1) the value of the property: (2) the cost of the property; (3) the capital stock at par value; (4) the capital stock at market value; (5) the capital stock plus the bonded debt at market value: (6) the capital stock plus total debt, both funded and floating; (7) the business transacted: (8) gross earnings; (9) dividends; (10) capital stock according to divi- 63 TAX. dends; (11) net earnings; (12) value of fran- chise. Several States have accepted gross revenue or net earnings as a basis for ta.xation, and in several States, Wisconsin, Michigan, etc., this tax is progressive. A feature of recent taxation is the so-called special franchise tax. A tax of this sort, which falls upon "franchises for the use of streets granted by municipalities to pub- lic-service corporations," was passed by the Xew York Legislature in 1S99, and a somewhat simi- lar tax was levied in New .Jersey in lUOO. One of the most serious drawbacks to the just and equitable taxation of corporations lies in the in- terstate location of their property and the in- terstate character of their business and the con- sequent frequent conflicts of jurisdiction. To prevent this Prof. Henry C. Adams advocates the Federal taxation of interstate commerce, while another authority on finance (Professor Seligman) urges uniformitv' of State action or, in default thereof, taxation by the Federal Gov- ernment and subsequent redistribution of such revenue among the States. Federal Taxatiox. The revenue of the Fed- eral Government has been obtained principally from customs and internal revenue duties. From 1875 to 1898, inclusive, the receipts from inter- nal revenue fluctuated between $111,000,000 and $171,000,000. then during and after the Spanish War they rapidly rose to $307,000,000. Of this amount $254,000,000, or over four-fifths, were ob- tained from spirits, fermented liquors, and to- bacco in the order named, $39,000,000. or 13 per cent., from the stamp taxes, and the remainder from legacies and distributive shares of per- sonal property, oleomargarine, playing cards, special taxes not otherwise enumerated, pen- alties, etc. The following table shows the receipts of the Federal Government from taxation for the ten vears 1892-1901: Customs revenue Internal revenue 1892 $177.4o2,9U-l 203,355,017 131.818,630 152.158.617 100,021.7.52 176.5,54.127 149.575.062 206.128.482 233.164.871 238,585.456 $163,971,073 1893 1894 147 111 '>33 1895 1896 146 762 865 1897 146 68s 574 1898 1891) 1900 295.327,927 1901 307 180,664 In 1894 and from 1898 on, the internal revenue has been more productive than the customs revenue, this having been also true during the fiscal years from 1864 to 1868, inclusive. The cost of collecting the customs revenue in 1901 was 3.23 per cent, and that of collecting the in- ternal revenie was 1.43 per cent., or $1 of cost for .$70 collected. BicLioGKAPHY. The best works in English which cover the general subject of taxation are: Adams, Puhlic Finance (New York, 1898) ; Selig- man, Essat/s in Taxation (New Y'ork, 1895) ; Bastahle, Puhlic Finance (London, 1895). For American conditions, see Ely, Taxation in Ameri- can States and Cities (New Y'ork. 1888). See also: Seligman, Shiftinq and Incidence of Taxation (Baltimore, 1892) ; id.. Progressive Taxation (Baltimore. 1894) : Cohn, Science of Finance (trans., Chicago, 1895). Taxation is
