164 FOREST VALUATION 



amount of the commutation tax is made a lien on the entire 

 consolidated tract and extinguished by cutting on any portion 

 of it. 



Some such plan of taxation is recommended as possessing 

 greater merits than an immediate substitution of income tax 

 for capital tax in timbered regions. 



No law providing for proper taxation of forest lands should 

 give arbitrary powers to a state official to prescribe or regulate 

 the scientific methods to be followed by the owner in growing 

 trees. The one condition to be insisted on must be that the 

 land, especially that without merchantable timber, shall be 

 brought under forest cover composed of useful species, and 

 maintained as forest land. Cancellation of classification should 

 follow failure of owners to comply with these basic conditions. 



To prevent owners from taking advantage of such laws in 

 order to escape taxation on property which they may ultimately 

 intend for some other purpose, two precautions are used: the 

 limitation imposed by classification of lands suitable for forest 

 purposes, and provision for payment of a penalty upon cancel- 

 lation of this classification. Connecticut and Vermont prescribe 

 that lands above a certain value per acre, not including timber 

 values, cannot be classified. Massachusetts, in permitting any 

 lands to be classified regardless of value, protects the public 

 by permitting revaluations, which is perhaps the better 

 plan. 



On cancellation of classification the penalty imposed should 

 not exceed the difference saved on taxes by the classification. 

 Connecticut determines whether the property at time of cancel- 

 lation has increased in value and assesses this increase at one- 

 half the average rate of 10 mills, or 5 mills per year, multiplied 

 by the period of classification. The owner thus pays his back 

 taxes (without interest), on the theory that the increase has 

 been uniform throughout the period. Massachusetts releases 

 the owner by the payment of the products tax on all timber 

 standing at the time of cancellation. 



The apparent difficulties of securing the adoption of rational 

 tax systems for forest property, not the least of which are the 



