FORESTS OF PORTO RICO. . 15 



Under these circumstances the law should make it possible for the 

 forest to be classed as a crop. The growing of a forest is no less 

 desirable to encourage than the growing of a crop of sugar cane, coffee, 

 or tobacco; yet these latter are exempted entirely from taxation, 

 while the forest is classed as an "immovable" and taxed annually 

 at its full value. There is little wonder, under these circumstances, 

 that no effort is made to practice forestry, which would inevitably 

 increase the extent and value of the forest; or that the value of this 

 class of property has decreased regularly from year to year, and for 

 the fiscal year 1912-13 amounted, both timber and land together, to 

 but 3.3 per cent of the total assessed value of all real property. 



-The law should at least provide that the land and timber be classi- 

 fied, assessed, and taxed independently of one another. The average 

 forest crop requires several years, often decades, to mature. During 

 this period it yields little or no revenue whatever. It is only fair to 

 the producer of such a crop that his taxes be arranged to fall due in 

 large part at the time when the crop matures and is sold. This may 

 be accomplished in one of three ways. If the owner pays throughout 

 the entire period a tax based on the full productive value of the bare 

 land, then the timber should be exempted entirely. At most it 

 should be taxed but once — on its sale value as it stands in the forest 

 in the year that it is cut. The rate in this case should be the same 

 as that applied to all other real and personal property for that particu- 

 lar year. A second method is to defer collecting any tax on the land 

 until the timber is cut and then to take both the land and timber tax 

 out of the sale value of the standing timber in that year. The rate 

 in this case would, of course, have to be considerably higher than 

 the general property tax rate and would properly be graduated accord- 

 ing to the length of the period since the previous tax was paid. A 

 combination of these two methods, modified according to circum- 

 stances, though less just to the landowner, would be at once an 

 advance over the present plan and the most Hkely to be acceptable 

 to the community. Thus an annual tax on the land would be levied 

 either at the full general property rate on a nominal fixed value for 

 the bare land or at half or other fractional part of the general prop- 

 erty rate on the full productive value of the bare land. Then when 

 the timber was cut, it, too, would be taxed, but at a rate corre- 

 spondingly higher than the general property rate, say 10 per cent. 



Porto Rico is fortunate in that it has no constitutional obstacles to 

 remove before it can proceed to a change. Neither the organic act 

 nor any of the subsequent acts of Congress puts any specific restric- 

 tions on taxation. It is only necessary, therefore, in order that this 

 unjust discrimination against forests and forestry may be removed, 

 to induce the legislative assembly to amend the present law. 



