Show warnings W arning on 0 proposed severance tax t there there have always been people in our body politic as at well as elected cals cais who have sought to spend more for governmental services than thap vas was jhen available atrall airall able abie many M any 0 of f these people to 0 accomplish ac empl ish their ob have then sought new of revenue to provide the funds ar for th their thein ein eln project t or oe department such people ve opie ople and such movements nrc arc always with us here in utah we have r recently experienced a new phenomena this Is a group of citizens who feel foci that some of our extractors and processors of natural re rp sources have been making an nn conscionable profit out of their business and have proposed that additional taxes be imposed upon these people for the pur pose of providing funds not for any specific projection project or purpose but just providing funds firt ids because it Is felt that these processors and extractors extrac of raw materials can cah and should pay more to the state of utah if the basIs for this movement Is founded on the assum assumption p ti 0 n that the extractors of raw ma tc te rials are arc making an ancon scio profit from their theli busl busi ness than it would seem logic logical a I 1 that the method of imposing n ad dit ionni taxes upon these indus tries s should he some form of 0 f franchise ranc hi se or drof prof i t tax A in 7 oth nth er wor wre d s I 1 t should only iw 0 agniv 0 y to 10 those o who nrc arc makine making an lincon bie hie ble profit and should not den nen penalize alize an an operator one ode odera opera whore whose ajio bil aness siness Is mn rainal to the that sn n additional leav nasf w would uld lne Ine renive his hir ft eo cort cost rt of f bosi busi no ness ess esq and require the clos a W of 01 his hl nis business alness it esthal that the fhe sponsors of this S csc new rew levy 1 which Is gene genf rai ral av i called clr a n severance CAir narna tax meow ua AS havo have fy apcie mo no attempt mp to ro distin olvar sh h between the te processors Droes sors who vv aro nrc ank n ingan an neon crofit and thoe who nep see maker a n reasonable als pa awl pro fh fit tt it seems that there Is pa no efto nn their ui oart r to ii i i i vill th between ahn se winve busi busl nir ni fan R 15 I 1 now with oder over ntine costs which not al annj low hit nis any additional burden to b plara va A il n conring their 1 business and those who annare makine mar mak w hat t thew term 1 p prom profit this L s thinking IK 2 hs nans v been I 1 caad 1 tn in ln 1 the 41 n ste platform t for bere 1948 4 ene where ere after that the field of nf taxation should be examined reexamined re it provides nhat that the natural resources of the state stemm nf of utah ut as ne they hv y are nr developed ev eloped be made to produce legitimate returns bv way of revenue to the state of utah in other words the tho 1 air aar drafters ar allers aliers OI 01 of this lis p plan olan a seek E to t have ave a return to the state ioa koa f rom all ali natural resources hather wl 1 the ode ove operator ma makes k es a 0 01 ol drof it 1 t or o r not 1 it Is quite obvious 0 hv nv oh this nus is tl tant oin HIM t i the olt nit basic idea ii it u is Is to w increase increate increase the cost of doing busi busl ness for those engaged t ln in the ex retraction t rac ti an and d process Pro cessine i ng 0 of f naon at tural resources it Is not an att tempt tep to anke a part of their drobits Dro fits in other words this re t aad ard t 0 th e st a t e i s to b p aid ald j 1 aj a basic doing business as and ln d isnetto is not tobe made odthe ot the predicated profits of upon the the ff fask operator thinking SK it that Is the natural resources belong to the state and that anyone seeking to extract and process any of these resources should 1 pay y a royalty to the state now in the first place it is fallacious to say I 1 th that at these resources belong to the state at least as to those that have now passed into vate vote ownership they dont be to tho iho state eny any more ore oro chah the jand jagd which dill is filled by the farmers belongs to the Stat state eor or the pasture posture and grazing I 1 lands an ids ida udd the sheep and cow men balb belong clyto to 1 the e state in the sec ond ona on pa paoo 1 there thero exist in the state bf fco tco u utah tah many natural soua sources e s which though kno known walor or many mp ny years have never become the basis at xit a ah n industry of cx ex traction and processing because the cost of such ex extraction traction and pr processing exceeds the value 0 o of f the finished product to further lh increase crease th this 11 3 cost will further er postpone the day in which these resources can be utilized anad it will further mean that certain low grade ores exist ing 1 along side of higher grade ores ca will wi bc be left ieti in pince place in the mining or extracting process so that the precious semiprecious semi precious or base metals represented by those low grade natural resources wm will be forever lost to mankind the cost of operating any busl busi ness noss has increased materially in recent years and although the selling price of some of the metals and other products ex acted from our natural re sources has increased the in crease has not been uniform and it t seems apparent that there will b be some cutbacks and some shut downs s in the field of extraction and processing of natural re sources within the future 4 the natural resources of this state c are valueless ii i i unless i de ve loped if developed they come a real asset in many ways for sor example what happens when a natural resource is develop eaf ear cd ed it creates creales employment for lor nien men money is spent nt with equip I 1 p ment and supplies of all kinds and eventually additional taxes nrc arc re paid fa into MJ the mi omke state what nun nan happens to the profits if fair are allowed expansion profits possible which provides anore plo pio employment i A tax if 11 suu buu started ted will make risk W capital very cau nona 1 ano ana and undoubtedly many new industries out of the and will certainly curtail expansion of many already established within the state our tax laws should be such that they will investors estors ps mors tors as ganv many of these ua na tural resources may be low grade and require rt large investments to develop develon natura nily ally 1 a good part pan yan ya of this 0 4 11 cc coes mes from out of the state what y are g some of the char a st of tax tox blat ya has it accomplished pg sted sied in states who have experienced its passage narite na aige wite A ait alt A ri it does docs not distinguish eiten tween high and low pro dubers a 1 this tends to encourage the socially practice of exploiting only the better de posits or resources ace 2 api the tax Is based on nn amount nr or value of output without refer ence anceto to the fact that mines fon for example e will be taxed at a con stant rate despite steady deduc in the value of property through depletion this means an in increasingly crea singly high tax based baso A on value of pro property and is cow con i arary y to t the princ principle pie of property I 1 tax as well weli as ability to pay pax pa 3 this alone would make ang properties hard to sell or interest risk capital it could make local companies companies noncompetitive competitive non with similar products extracted from adjoining sta str states A through study fy would woula determine that these companies extracting raw materials and creating employ ment get no higher rate of re ret 1 turn on their investment than many other business within the state stai stat the th outstanding characteristic of t the tax is that its sponsors believe it is austif led be cause of high earnings yet it has no relation relationship p whatsoever to which must be 6 paid whether there Is any profit crofit or not 1 lets leta develop our state and have a fair and just tax which lwe we now have if additional reven neven I 1 ws must be had hid by the state lets t obtain them from newin new in destries dus tries and new developments i a and not through taxes which by their nature will discourage new industries and new develop ments i fv intermountain t ti industry |