52 



2. That it insures steady and continuous local revenues, and the pos- 

 sibility of adjustments of values. 



3. That it does away with the false principle of special privilege in 

 assessed values or rates of taxation. 



The abandonment of the idea of limiting the power of assessors to 

 raise land values is a hard point to concede for advocates of forest tax 

 reform. But it is the first step towards any lasting progress, and must 

 precede the educational movement which will be needed to secure equitable 

 valuation of forest land, based on its value for growing timber. If assessors 

 can so easily defeat the purpose of special privileges, they will continue 

 to show a certain amount of unfairness in valuing lands belonging to 

 different owners, but it will be much easier to correct these inequalities 

 when all owners of forest land are equally interested. 



The second distinct gain which the Massachusetts law presents is in 

 its plan for taxing standing timber. In effect this is to continue the annual 

 tax on the present assessed value of this timber until it is cut or destroyed, 

 but to arrange for the substitution of a products tax in place of this sys- 

 tem, as soon as possible. 



For this purpose, after the original separation of assessed value into 

 land and timber, the value of the timber can not thereafter be increased. 

 But as fast as the timber is cut, and pays a products tax, this assessment 

 is reduced. The basis of reduction is value, not quantity. The purpose is, 

 to maintain the original total assessed value of the property, land and 

 timber, thus maintaining the town revenue from annual taxes. The chief 

 merit in the law is, that only the original assessed value of timber pays 

 this annual tax. Growth in value, or growth in volume is not so taxed. 

 Value of the timber cut is the basis of wiping out this value of standing 

 timber. So that if any such increase in value or growth occurs, it is not 

 necessary to cut all of the timber in order to do away for the future with 

 the system of annual taxes on the timber. 



Since all increases in assessed valuation of timber are prohibited, the 

 owner of timber who manages it to secure growth, or who leaves young 

 trees or a part of the stand for forest investments, and the owner of land 

 who plants it or of immature timber who protects it, is assured of relief 

 from all annual taxes on standing timber for the future. He does not 

 pay these taxes on any timber except the present value of his present 

 mature stock, on which as we have seen he should probably pay in 

 any case. By paying on this value, the town revenues are absolutely 

 protected for the present and near future. It is an equitable arrangement 

 for the taxpayer and for the community. 



The third provision of the Massachusetts law js the products tax, im- 

 posed on timber at the tyne of cutting. In this law the payment of this 

 tax is the means of securing the reduction and final abatement of the 

 annual tax on standing timber. This would appear to threaten double 

 taxation. But in effect, this danger is done away with by fixing the amount 

 of the tax. This law increases the tax one per cent by five year periods 

 up to a maximum of six per cent, on the value of the timber on the stump 

 at time of cutting. 



The justification of imposing a products tax on timber wlach has been 



