FIFTH NATIONAI, CONSERVATION CONGRESS 137 



The Property Tax. — The property tax in European countries is to be dis- 

 tinguished from the general property tax with which we are famiHar in America. 

 The general property tax is a tax levied upon practically all kinds of wealth at a 

 uniform rate. This sort of tax has long ago been abandoned by most European 

 countries. Switzerland is the one nation where the general property tax is still 

 important. Property taxes, however, in the sense of taxes levied upon the capital 

 value of certain specified kinds of wealth, still continue to occupy a position of 

 more or less importance. 



The basis of the property tax is theoretically the actual value of the property 

 in question. This means the market value, or the value which corresponds to the 

 average customary price at which property of the character in question is sold. 

 In the case of forests it is, of course, obvious that the intention of the law is not 

 easily carried out, since sales of forests are of infrequent occurrence. Where it 

 is impossible to determine the actual selling price of forests it becomes necessary 

 to fall back upon some other method of determining the value. The method 

 usually chosen is to ascertain the normal yield produced by a given forest and 

 then obtain the proper value by capitalizing this yield at some specified rate of 

 interest. This, of course, makes the property tax quite similar to the ground tax, 

 though with this great difference : the property tax is based not on an ancient 

 cadaster but upon assessments frequently made and revised. This procedure 

 also introduces serious theoretical questions and administrative difficulties. There 

 is, for instance, much dispute among German foresters over the proper rate of 

 interest for capitalizing forest yields. The property tax has, therefore, shown 

 itself subject to many of the difficulties pointed out in the case of the ground 

 tax. Outside of Switzerland no important European country makes the prop- 

 erty tax its sole or principal tax. Where it exists it usually serves the purpose 

 of a supplementary tax for the purpose of placing an extra burden upon funded 

 incomes. 



The rates of the European property taxes vary greatly, but are normally 

 very much lower than we are familiar with in this country. 



The Tax Systems of the Principal European States. — Very few states use 

 all three of the above-described taxes. The typical modern system consists of 

 the income tax as a principal tax, with either the. ground tax or the property tax 

 as a supplementary tax for the purpose of placing an extra burden upon funded 

 incomes, and upon wealth yielding no income. As has been indicated, the ground 

 tax is today falling into disuse, and the property tax is coming to be the leading 

 supplementary tax. For example, in the German Empire the important states of 

 Prussia, Hesse, Baden, and Bavaria make use of the general income tax with the 

 supplementary property tax. Saxony, Wiirtemberg, and a considerable number 

 of less important states use the general income tax with the supplementary ground 

 tax. A still smaller group of states uses either the ground tax alone or a combi- 

 nation of all three, income tax, property tax, and ground tax. 



Austria uses the general income tax with a supplementary ground tax. In 

 Switzerland the property tax occupies a position of greater importance than any- 

 where else in Europe. The income tax is also of importance. In some cantons 



