PRESENT STATUS OF FOREST TAXATION" 475 



EXEMPTION AND BOUNTIES 



Some States have not only exempted forest property from taxation, 

 but have also subsidized the owners of forests in the interest of devel- 

 opment and conservation. Experience has proved, however, that 

 neither exemption nor bounties have led to any marked increase in 

 timber culture, l^iounties need not demand our serious attention, for 

 they have no place in a discussion on taxation. Concerning bounties, 

 how^ever, the following- statement of the IMassachusetts Commission is 

 conclusive : "We believe that, except in unusual cases, bounties are 

 wrong in principle. To secure the reforestation of mountain slopes 

 that need to be kept under permanent forest cover, a government may 

 be justified in offering pecuniary inducements ; but under ordinary con- 

 ditions timber production no more needs, nor should receive, a bounty — 

 or exemption from forest taxation — than the production of any crop. 

 Forests can and should be taxed, and other countries have made them 

 a reliable and productive source of revenue." We are of the opinion, 

 however, that certain other caftditions and circumstances may justify 

 bounties, especially if it is found that they will actually stimulate tree- 

 planting. Such conditions apparently obtain in some of our Middle 

 Western States, which are almost totally devoid of timber. 



As observed above, the exemption of forest lands for a period of 

 years during the early growth of the trees has for the most part been 

 ineffectual in stimulating forestation. The revenue thus lost through 

 the exemption of this class of property is frequently made up by in- 

 creasing the levy on other classes of property. Even if this is not done, 

 exemption for a brief period of years affords but little inducement to 

 plant trees, so long as the more mature crop is later subjected to the 

 burdens of the general property tax. 



RECENT CHANGES IN FOREST TAXATION 



With these preliminary observations, we will now turn our attention 

 to the examination of the methods of forest taxation prevailing at the 

 present time. Six States have more or less recently enacted laws pro- 

 viding for more scientific and more equitable methods of taxing timber 

 property. These are IMassachusetts, Connecticut, A'ermont, Xew York, 

 Pennsylvania, and Michigan. In these States the general tendency is 

 to substitute for the annual tax on growing timber a tax to be levied 

 and collected at the time the timber is cut. There is therefore a for- 

 midable beginning of a tax reform relative to the taxation of forests, 

 which recognizes the difference between levying an annual tax on prop- 



