BEST METHODS OF TAXATION. 783 



the Massachusetts commission proposed a modified form of this tax. 

 An annual rental value of four hundred dollars was to be exempt 

 from taxation, but ten per cent was to be levied on all rental values 

 in excess of that amount. 



" The advantages of a tax on house rentals," said the commis- 

 sion, " can be easily stated. It is clear, almost impossible of evasion, 

 easy of administration, well fitted to yield a revenue for local uses, 

 and certain to yield such a revenue. It is clear, because the rental 

 value of a house is comparatively easy to ascertain. The tax is 

 based on a part of a man's affairs which he publishes to all the world. 

 It requires no inquisition and no inquiry into private matters; it uses 

 simply the evidence of a man's means which he already offers." * 

 If this tax were to be given it would be possible to wipe out all the 

 tax on incomes from " profession, trade, or employment," to abolish 

 the existing assessments on personal property. The effects would 

 be far-reaching. If loans of money are free from taxation, the 

 purchasing power of money in the same degree must diminish, which 

 simply means that the purchasing power of farms and products of 

 farms for money must to the same extent increase ; hence, the bor- 

 rower on bond and mortgage will not be subject to double taxation 

 first, in the form of increased rate of interest, and then in taxa- 

 tion of his real estate and hence the farmer or landowner who is 

 not in the habit of either lending or borrowing money will find his 

 ability to meet additional taxation on his land increased in addi- 

 tional value of land and products of land in proportion as the tax 

 is removed from money at interest. Also, the exemption of the 

 products of farms and things consumed on farms from taxation will 

 give a corresponding increased value to compensate for the " build- 

 ing-occupancy " tax. Tenants controlled by all-pervading natural 

 laws can and will give increased rents, if their personal property is 

 exempt primarily from taxation. The average profits of money at 

 interest or of dealings in visible personal property free from taxa- 

 tion can not exceed, for any considerable length of time, the average 

 profits of real estate, risk of investment and skill in management 

 taken into consideration; and therefore the real pressure of taxa- 

 tion under the proposed system will finally be, like atmospheric pres- 

 sure or pressure of water, on all sides, and by a natural uniform 

 law executed upon all property in every form used and consumed in 

 the State. Persons must occupy buildings and business must be 



of any building or portion of any building used as a dwelling, or for any other purpose, on 

 a valuation of three times the rental or rental value of the premises occupied. Tenement 

 houses occupied by more than one family, or tenement houses having a rental value not in 

 excess of a fixed sum, to be taxed to the owner as occupier. Report, p. 107. 

 * Massachusetts Report, p. 106. 



