rather a minor charge, though undoubtedly making up a larger proportion 

 of the cost of production than in some other industries. Mr. J. W. Bris- 

 lawn, of the State Tax Commission, stated before the tax conference at 

 the University of Washington, May, 1912, that the farmer pays ap- 

 proximately 6.43 per cent of his gross earnings for taxes.** Referring 

 to Tables II, IV, and VI, it may be seen that the first cost of taxes under 

 the general property tax amounts to from 3 per cent to 10 per cent of the 

 cost of producing timber, hence not differing widely from taxes in agri- 

 culture. However, so far as the owner is concerned, the actual cost to 

 him is more than twice as great because of the interest charges which 

 accumulate on the tax payments before the timber crop can be harvested. 



If the taxes were deferred until the crop is harvested it would be 

 of advantage to the owner without an entirely corresponding loss to the 

 state which works under a lower interest rate. A yield tax at the time 

 of cutting, greater in the aggregate than the present general property 

 tax, in fact large enough to entirely reimburse the state for the deferred 

 payment, would be advantageous to the producer of timber. 



Should the producer of timber be subjected to a yield tax it would 

 need to be placed at much less than 25 per cent of the gross yield or it 

 would cost the owner far more than the present system, interest included. 

 By referring to the 6 per cent column in Table I, it may be seen that 

 the amount of the general property tax and interest thereon is $120.40. 

 If a 25 per cent yield tax were computed, as in the 3 per cent to -11X> 

 per cent columns, it would cost the owner $163.81, a much greater amount 

 than the present system. The main advantage of the yield tax then, unless 

 the percentage were reduced, would be that it could be met easier when 

 the timber was cut. This would be no great advantage except to owners 

 who managed forests under intermittent yield, a poor system, and one 

 not apt to be maintained by any owner. A properly managed tract will 

 give a yield annually from some part of the tract. Hence this system 

 is not considered by the writer to be of much value, unless the percentage 

 cf the yield taken were reduced much below that now paid by the 

 federal government. Therefore, the state cannot hope to secure anything 

 like the tax revenue from private lands in forest as it now secures from 

 the National Forests ; or rather as it will secure when cutting is in full 

 force in the National Forests. 



In this connection it should be emphasized that, as a matter of fact, 

 it is a fallacy to assume that even the state can practice forestry without 

 paying a tax. The presence of the utilized forest means people. Peo- 

 ple mean taxes for schools, roads, and general expenses of government. 

 Hence the state must spend money for the ordinary purposes for which 

 taxes are expended. If it does not take this money from its forest 

 revenue it must come from general revenue. Hence in effect if the state 

 undertakes to own productive property it must pay taxes which the 

 private owner would have paid had the resource remained in private 

 ownership. Since the state is an aggregation of citizens mostly tax- 

 payers in some form, payment of these expenses out of general funds by 

 the state is the same as paying a tax by the citizens. 



**See p. 40. Taxation in Washington, University of Washington Exten- 

 sion Series No. 12. 



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