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Show TAX SITUATION I IS DISCUSSED i I ANSWKKS KKQllKKT I FOR CRITICISM OF j PRESENT TAX LAWS j The Governor has ap-olnted the Stat Tax Commission nr.J the Commission Com-mission has met with the Legislative committee nnd together 1 ixve invited through the press, criticism of our present tax laws, or have requested somebody to advance a new theory, or plan of tax revision, or miracle, which will end all our t.x troubles forever and forever. ' Let us review our present method of tnxation first, and see where, if possible, our "system" is wrongs Several 'Tax Commissioners'', which have been appointed in t ie past ten years have reported, so rumor says, that our tax system is the poorest system that could be adouted. Now, is it the fault of the administration adminis-tration of our tax laws or is our tax system wrong? Who is crying- for relief? Are we going- to shift the burden of taxation from one class of taxpayers to another cla.is, or are we going to really try to equalize taxes on all classes of property according ac-cording to its value in MONEY? The legislature of 192'.i was confronted con-fronted by two main issues: the tax situation, and the Boulder Dam Six Suite Compact. Most writers and speakers put the Boulder Dam Bill first but the writer, having made a : study of the tax methods of this state and discovering that even in dollars and cents, the State of Utah will collect and spend more money during 'the next eight years than the cost of the Boulder Dam or rather the ap- : ronriation of 1C5 million which Con--.-.-es.s made for the building of the . in and as far as Utah is concerned, concern-ed, the benefit to this state is prob-matical. prob-matical. For all purposes the s ate, schools, .o-nties, cities and towr.s will levy ' and collect during the year 1929 in excess of 27 million dollars and if expenditures are kept on same basis during the next eight years, the total amount will exceed 216 million dollars. dol-lars. To raise this amount of money and make an equitable distribution of the taxes is the duty of first, the "State Board of Equalization," nnd second the "County Assessors" together with the County Commissiont rs of each county who sit as a counly board of equalization. The foundation of the fcix structure of the State of Utah is the amendment amend-ment to the Constitution of the state which took effect January 1, 1919, and which in plain words was to put a full cash valuation on all property in the state except that property which is exempted by the constitution. This amendment reads as follows: Sec 3 of Article 13. Legislature to provide uniform tax. Exemptions. The legislature shall provide by law a uniform and equal rate of assessment assess-ment and taxation on all property in the State, according to its value in money, and shall prescribe by general gener-al law such regulations as shall secure se-cure a just valuation for taxation of all property, so that every person and corporation shall pay a tax in proportion to the value of his, her or its property: provided, That a deduction deduc-tion of debits from credits may be authorized: provided further, That the property of the United States, of the State, counties, cities, towns, schools districts, municipal corporations corpora-tions and public libraries, lots with the buildings thereon used exclusively , for either religious worship or charitable charit-able purposes, and places of burial not held or used for private or corporate cor-porate benefits, shall be exempt from taxation. Ditches, canals, reservoirs, pipes and flumes owned and used by individuals or corporations for ir-I ir-I rigating lands owned by such in-I in-I dividuals or corporations, or the in-I in-I dividual members thereof, shall not : be separately taxed as long as they J shall be owned and used exclusively 'for such purpose: provided further, jThat mortgages upon both real and ' personal property Bhall be exempt from taxation: provided further, That the taxes of the indigent poor .nay be remitted or abated at such ' time and in such manner as may be provided by law: provided further, That the legislature may provide for the exemption from taxation of homes, homesteads, and personal property, not to exceed two hundred and fifty dollars in value for homes and homesteads and one hundred dollars of personal property . Then what is the crux of our tax situation? Nothing, except the provisions pro-visions of that portion of our present Constitution which says: "According j to its value in money." In other .words the value of a dollar in property prop-erty must be defined or fixed to our I monetary or gold standard. Tho Slate Hoard of Kijimlizulloii bring, the head of our lax aystoin is naturally tho board to determine what the value of property ia ami to place the assessed value on property prop-erty as a whole but inure specifically on property which iu law, comes under un-der their immediate control such us is provided by law. One of the duties of the State. Board of Equali-I zation as fixed by law are ns follows: 1 Laws of 1919. fS73. Assessments ' by State Board of Equalization. All property nnd franchises owned by railroads, street railroads, cur, telegraph, tele-graph, telephone, electric light, pipe line, power, canal, irrigation, and express ex-press companies operated in more than one county in this State, and the value of uieltalliferous mines based on some multiplo or submulti-ple submulti-ple of the annual net proceeds thereof, there-of, as provided in Section CSC-1 , and all other mines and mining claims or hydrocarbons, including nonmettulli-ferous nonmettulli-ferous minerals underlying the surface sur-face of which is owned by a person other than the owner of such minerals, miner-als, and all machinery used in mining and all property or surface improvements improve-ments upon or appurtenant to mines or mining claims, and the value of any surface use made of non-metalliferous mining claims or mining property for other than mining purposes, pur-poses, must be assessed by the State Board of Equalization as hereinafter provided. Other franchises shall bo assessed in the county or city where the franchise is exercised. Now let us review what the State Board of Equalization has valued the Public Utilities during the year 1928 Miles Asses. Val. Pub. Util. Val. Western Pacific 1C7.22 $ 5,597,01-1 None U. P. Park City Br 7G. 78G.800 Central Pacific 35G.13 12,889,936 D. & R. G ...1,057.5 23,5-16.0-14 L A. 4 S. U . 709.05 17,520,139 O. S. L. 447.59 13,039,038 Union Pacific 200.05 9,410,484 " Utah Railroad 50.0-1 3,010,427 $9,068,903 Total mileage - 3.0G3.59 JS6,40o,612 The total mileage based on the valuation as reported by the Utah Railroad, a nearly new railroad, having just been built a few years ago, would amount to the sum of $556,293,608 as against their assessed valuation of $86,406,512, Taking an average of the valuation of the Utah Railroad company and an obsolete valuation of the Western Pacific gives us a valuation figure on the 3063.5 miles of class 1 railroads in Utah a value of $267,570,034. Class 1 Steam Roads assessed Val. $80,406,512 Income Val. $267,570,034 Class 2 Steam Roads assessed val " " 5,897,429 Class 2 Steam Roads assessed val " " 8,615,109 Terminal Companies ". " " " 2,033,181 Electric Roads " . " " " 18,76870 Total Telephone Cos. " . ." " " 12,565,443 Power Cos. - " " Approx. 90,000,000 " Private Water Util. " " " " 826,497 " Automobile Lines " " " " 1,649,763 " Gas Utilities " " " 7,664,992 $410,060,S18 The total valuation for tax purposes by the State Board of Equalization is $131,110,528 against practically 425 million dollars invested capital. This total does not include the telegraph companies, whose holdings in the State amounts to between seven and twelve millions and other small Utilities scattered over the state. Most people will view these figures with disdain and say they are guesswork, guess-work, but these figures on the valuation valua-tion of the railroads come within the percent of what the government reports their worth. Even if these Invested Utah Railroad ...$ 9,068,963 Mt. States T. & T. Co 12,062,203 Millard Co. T. & T. Co 54,712 Uintah Telephone Co 148,337 Telluride Power Co 1,676,119 Dixie Power Co. 979,807 Uintah Power & Light Co... 354,550 Utah Parks Co 908,443 Utah Light & Power total valuation valua-tion in Idaho and Utah $121,527,685. In Utah their assessed valuation is $20,611,451, and a former engineer of the Utah L. & P. company told the writer that approximately sixty-five to seventy percent of their property is in Utah and more than seventy per cent of their income comes from Utah. This would make their investment invest-ment approximately 80 to 85 millions in this state upon which a tax valuation valua-tion is placed of twenty and a half millions. In a case regarding taxation in the State of Utah in the Supreme Court of the U. S., Justice Sutherland Suther-land said "The Utah State Constitution Constitu-tion plainly contemplates that all property, irrespective of its character charact-er shall be taxed according to its value in money." In another case Adams Express company vs Ohio State Auditor: 166US185 the court says: "It is a cardinal rule which should !.':. u:.e we li:.vi- a valuation cheek on them t In u I he valuation department depart-ment of tin- I'uli.ic Utilities Colrllllis-.sion. Colrllllis-.sion. ihcn it was ..lai d that wo have a cluck on the valuations of the Public Pub-lic Utilities that should lie chunked to a partial check on llie utilities as our Slate Public Utilities Commission Commis-sion has never functioned according to the state law, as for instance, none of the Interstate railroads have complied with the law as regards to valuation of their main lines, going further the telegraph and some other Utilities has never filed a statement as they are requested to do by law. Any person interested in our tax laws should make themselves familiar famili-ar with our Public Utilities Law as it has been estimated nearly thirty-five thirty-five per cent of the entire wealth of our state Is invested in the Utilities. Space will not permit us to quote the entire law but I would call attention to one Section of the luw particularly: particular-ly: Compiled Laws 1917. 4815. Valuations Valu-ations of Public Utilities. The Commission Com-mission shall have power to ascertain ascer-tain the value of the property to every public utility in this state and every fact which, in its Judgment, may or docs have any bearing on such value. The commission shall have power to make revaluations from time to time, and to ascertain all new construction, extensions, and additions to the property of every public utility. The State Board of Equalization has put a tax value on the Class 1 Roads, including rolling stock and improvements: Nevertheless the exact amount could be ascertained from the Interstate Commerce Commission. This discrepancy certainly shows that either the Public Utilities' figures fig-ures on the Utah Railroad are too high or the assessed valuation are nearly 600 percent too low, but in either case, the Utah Railroad company com-pany insists on earning an amount to j make an income on $9,068,963 invest-j invest-j ed. But to continue the assessed valuations. figures were cut in half any person can see the almost criminal negligence negli-gence of the present taxation methods meth-ods of the State Board of Equalization. Equaliza-tion. The writer wants to state here that these figures have been compiled com-piled from the reports of the State Board of Equalization, the Public Utilities Commission and Government documents. Some illustrations of a few companies com-panies scattered over the State of their reports on invested capital and their reports for tax purposes are as follows: Tax Val $3,610,427 " T 5,462,934 " ..; 17,027 " 65.S91 " 445,763 " " , 223,463 " ' 92,412 " 255.S15 never be forgotten that whatever property is worth for the purpose of income and sale it is also worth for the purpose of taxation." The writer here wishes to mention a matter that has been much discussed dis-cussed in some of the newspapers of the state since the last Legislature adjourned, namely: S. B. No. 120 by Mr. Ryan. This bill proposed that power should be given to the State Board of Equalization to go into the various counties and equalize the valuations of individual property. This bill was killed in the House. Would it not be absolute folly to give a board more power when they have so abused their power? So conducted their tax policies as set forth in this article. It is almost inconceivable that a Legislator who knows any-I any-I thing about the tax methods of the 1 State Board of Equalization could ; vote to give them more power until they had . cleared their own house, and shown the people of the state ! that they are at least trying to In-fair In-fair in their valuations, as an ex ample: Total valuations of all Public Utilities approximately 425 millions asscsod valuation approximately 1 million as ai;ainst, say a i-.heepi.ian, average value of range sheep, y 12.00 per head, assessed valuation, Jb.UO per head, or the small home owner or farmer who Is assessed from 60 percent to 100 per cent of his actual value. One other matter that has entered the tax question in the state ia the propaganda that the Utah Taxpayers' Association ia putting out to the effect ef-fect that the properly owners of Salt Lake county are on a higher valuation valua-tion than out in the so-called cow-counties. cow-counties. The writer does not want to get into an argument with any county on their valuations, but something ought to be said regarding the propaganda propa-ganda tiiat is being sent out that Salt Lake county is being assessed on about 69 percent of their actual value and that Beaver county, as an illustration, being the writer's home county, is only being assessed at 39 percent of its value. By arousing the people on an absolute ab-solute falsehood of this kind will not do the State any good, for the writer is sincere in stating that if a committee com-mittee would be appointed to check the figures that they would find valuations in Beaver County on a par with Salt Lake County or about an average over the state, .which in the judgment of the writer is approximately approxi-mately 50 percent of actual value, except ex-cept in the case of personal property which is unquestionably valued too low. From the foregoing, the reader may think that the writer has some grudge or hard feeling against our Public Utilities, but such is not the case, but against the system which has prevaded the various "State Boards of Equalization." In all this matter no word has been said regarding the necessary income to our Utilities to pay the additional tax if their valuations are raised. The Public Utilities are created creat-ed as monopolies under our State law and if it were NECESSARY, the writer would be the first to advocate a raise in their rates. Now for a comprehensive plan to correct these abuses. Compel the Public Utilities Commission Com-mission to function 100 percent according ac-cording to our present law. Reorganize the State Board of Equalization on a business basis of six work days a week instead of a political pension basis of reporting to the Capitol once a week. Then if they will function according to law, give them full power on all tax matters mat-ters in the State Buch as the Ryan bill proposed in the last legislature. Make it their duty to supervise the taxes in every county. Give them the power to examine the books of every corporation and individual in the state for tne purpose of ascertaining their property values the same as the government uses in checking their income returns. Pass a law giving both the owner or any state corporate body the right to review any specific tax valuations in the District Courts along similar lines to House Bill 136 which was introduced in-troduced in last Legislature, but was lost in the sifting committee. PUT THE TAX VALUATIONS OF PUBLIC UTILITIES ON THE SAME VALUATIONS AS THEIR INCOME VALUATIONS. Increase the mine tax to meet the new valuations of other property. Re-appraise under the supervision of the State Board all real estate and especially personal property which has been appraised at approximately approxi-mately 15 percent to 20 percent of its actual value. Revalue all live stock, merchandise, merchan-dise, machinery, etc. Make heavy penalties for making false returns on valuations. No tax law will ever be perfect, but we can certainly improve on the administration of our present laws. GEORGE JEFFERSON, Milford, Utah o |