I 



BEST METHODS OF TAXATION. 781 



acceptable taxes on income, and Switzerland succeeds in modifying 

 her system in the line of direct taxes. 



There is an earnest movement in favor of a single tax on the 

 value of land, exclusive of other real property connected with it. 

 As involving a question of abstract justice the proposition has much 

 in its favor, but it can not be denied that practical obstacles oppose 

 its adoption. The recent commission on taxation in Massachusetts 

 thus treats of it : " It proposes virtually a radical change in the 

 ownership of land, and therefore a revolution in the entire social 

 body. In this form of taxation all revenue from land alone is to 

 be appropriated — that is, the beneficial ownership of land is to cease. 

 Whether or not this system, if it had been adopted at the outset 

 and had since been maintained, would have been to the public ad- 

 vantage may be an open question, but it would certainly seem to 

 be too late now to turn to it in the manner proposed. In any event, 

 it involves properly not questions of taxation, but questions as to 

 the advantage or disadvantage of private property in land." * 



If securities are to be taxed, the methods adopted should avoid a 

 double taxation, and an attempt to reach capital outside of the 

 State. It is evident that a State, like Massachusetts, which taxes 

 the foreign holder of shares in its corporations as well as the shares 

 of foreign corporations held by its own citizens, is inviting a dan- 

 gerous reprisal from other States. " Wherever the owner may be, 

 if the corporation is chartered within the State the Commonwealth 

 collects the tax on the shares. Wherever the corporation may be, if 

 the owner is within the State the Commonwealth also collects the tax 

 (in theory of law at least)." If this be the best possible system, and 

 it is supposed Massachusetts assumes it to be, general double taxation 

 w^ould follow its adoption by the other States. The effort to carry 

 this rule into practice proves its injustice as well as futility. The 

 most searching and inquisitorial methods of seeking such property 

 will not avail to reach a good part of it, and this results in adding 

 inequality of burden to its other difficulties. Evasion is too simple 

 a process to be unused, and the heavier the rate of tax the greater 

 will be the resort to evasion and even to perjury, express or implied. 

 The fundamental cause of the failure lies in this, " the endeavor to 

 tax securities, w^hich are no more than evidences of ownership or 

 interest in property, and which' offer the easiest means of conceal- 

 ment and evasion, by the same methods and at the same rate as 

 tangible property situated on the spot." 



This inherent difficulty can be cured only by abandoning the 

 attempt to tax directly securities or evidences of debt, representing 

 ownership or interest in property beyond the limits of the taxing 



* Report of the Massachusetts Commission, 1897, p. 74. 



