FORESTRY AS A BUSINESS 



519 



it tiniDer were Deing cut in every local taxation unit 

 under such conditions that the annual production would 

 be uniforniily certain and continuous, then a yield tax 

 on both public and privately owned timber might be 

 arranged. But there are such variations from this 

 condition that a yield tax alone cannot possibly fill the re- 

 quirements of certainty in annual revenue. There are 

 taxation units in which the stand of virgin timber is 

 inaccessible and will not be operated for years, hence a 

 yield tax would practically exempt that timber from 

 annual taxation and cause a corresponding increase in 

 the burden on other classes of property. On the other 

 hand, there are taxation units in which practically all 

 the virgin timber has been cut and the young timber on 

 these cut-over lands will not reach maturity in years, 

 hence under a yield tax would pay no annual revenues. 

 Between these two extremes are varying conditions and 

 once in a while a taxation unit in which a yield tax on 

 ail timber would not make any serious difference, as 

 compared to present conditions, but even there it would 

 be only temporarily adequate and certain, and for that 

 reason not practical. 



It follows that the only solution is such an adjust- 

 ment between a yield tax and an annual tax in such a 

 way as to meet, as nearly as possible, the necessities of 

 local taxation units and the economic conditions under 

 which forests must be grown. 



The first consideration in regard to a yield tax on 

 timber is the part of the stumpage value of the timber 

 that should be paid to the local taxation unit. Or, to 



what part of the stumpage value of timber at the time 

 it is cut is the local taxation unit justly entitled? 



In a state where there are no National Forests this 

 is a simple problem because all timber can be taxed the 

 same. Although there are no National Forests there 

 might be state forests, but the taxation on these and the 

 privately owned forests could be made uniform under 

 state laws. It would all be under state control and 

 there would be no problem of adjustment as between 

 state and national interests. 



In such a state let us suppose that lo per cent of 

 the stumpage value of timber at the time of sale is to 

 be paid in taxes, or that the rate of taxation on timber 

 is 10 per cent of the stumpage value, to be apportioned 

 to the state and local taxation units as provided. This 

 should apply to both state and privately owned forest 

 land so that both will be under the same financial bur- 

 dens and contribute equally to state and local revenue. 

 It might be claimed that the state is growing timber for 

 the public benefit, but it is not. It is growing timber for 

 the use and benefit of those who will need it in the 

 future, and they will have to pay for it, including taxes 

 with other costs. Certainly there will be incidental 

 public benefits, such as protection of watersheds, health 

 and recreational advantages and contributions to gen- 

 eral living conditions, vvhich will be the same from state 

 and privately owned forests. 



With state and private interests paying a yield tax of 

 ID per cent, each will have 90 per cent of the stumpage 

 value remaining, out of which must be paid the interest 



NEAR YOSEMITE VALLEY, CALIFORNIA 



There are certain incidental public benefits from forests, whether publicly or privately owned, such as protection of watersheds 



and contributions to general living conditions. 



