778 POPULAR SCIENCE MONTHLY. 



BEST METHODS OF TAXATION". 



Br THE Late Hon. DAVID A. "WELLS. 

 PART III {concluded). 



THE universal and admitted failure of the general property tax 

 to attain good results and the great difficulty, indeed the impos- 

 sibility, of reducing it to a form in which it can operate with effi- 

 ciency and an approach to justice, must lead to its abolition and the 

 gradual substitution of other and more simple taxes. However well 

 adapted to a community in which the taxable property was in evi- 

 dence and easily assessed for purposes of taxation, it becomes anti- 

 quated, unequal, and inquisitorial in a people where credit and credit 

 investments have been highly developed, and where the greater so- 

 cial activities, whether in commerce or industry, transportation or 

 production, are conducted by corporations issuing various kinds of 

 securities, none of which can easily be reached by a taxing authority 

 away from the center of incorporation. To imdertake to include 

 these securities, evidences of debt, or obligations in a general prop- 

 erty tax is to invite evasion, put a heavy inducement on concealment, 

 and, whenever effective, to give rise to shocking inequalities of bur- 

 den. The widow and orphan, whose property is in the hands of a 

 trustee, pay the full tax; in any other direction the holder of stocks 

 or bonds, money or notes, escapes according to the elasticity of his 

 conscience. The very exemptions recognized by law give an oppor- 

 tunity for new evasions, based upon analogy or upon some techni- 

 cality under which the business is conducted. Bonds of the United 

 States, the legal-tender notes, or money are beyond the reach of 

 State authorities for the purpose of taxation. In the same category 

 come also all imported goods in original packages, in the possession 

 of the importers, and all property in transit. These exemptions 

 alone amount to thousands of millions of dollars, and the tendency 

 has been to increase the number of items exempted. But every 

 such exception under the law adds to the burdens of the honest tax- 

 payer, and every evasion of taxation also renders his charge the 

 greater. Here is not distributive justice, but concentrated in- 

 justice. 



Another large proportion of the personal property owned by the 

 citizens of the State is of the most intangible character, and in great 

 part invisible and incorporeal, such, for instance, as negotiable in- 

 struments in the form of bills of exchange. State, municipal, and 

 corporate bonds, and, if actually situated in other States, exempt 

 from taxation where they are held; acknowledgments of individual 

 indebtedness, and a number of similar matters. All property of this 



