FOREST TAXATION IN THE UNITED STATES 389 
Finally it must always be remembered that taxation is by no means 
the only obstacle to the practice of forestry; in many cases it is not 
even the chief obstacle. Where other economic factors outside of 
taxation make forestry appear so unattractive to private capital that 
forestry would not be undertaken even though the tax obstacle were 
entirely removed, it should be obvious that a tax option which does 
no more than equalize the taxation disability between forestry and 
other investments will not command the interest of the forest land 
owners. 
On the other hand, it should be recognized that, even though an 
optional yield-tax law may have had no substantial direct effect on 
the forest-tax situation in any State, it may nevertheless have had 
an indirect effect. ‘The publicity necessary to secure passage of the 
law may have produced some educational benefit by making more 
citizens forestry-minded. ‘Tax assessors may have been constrained 
to assess forest lands more moderately lest the owner take advantage 
of the option offered. There is little evidence available as to the 
importance of these indirect results. In any case, no law could be 
ee solely because it might lead to such haphazard and indirect 
eneiits. 
The experience with yield-tax laws of the nonoptional type has 
been very short, but it indicates that they promise to have far broader 
influence for good or ill than those of the optional type. The earliest 
nonoptional law was adopted by Oregon in 1929, and in spite of the 
difficulties of initiating classification policy and methods, over 700,000 
acres, or 5.2 percent of the privately owned forest land, have been 
classified. This is more than double the proportion classified under 
the most popular of the optional yield-tax laws, and the work of 
classification is still in its early stages. 
Experience with yield-tax legislation, both of the optional and 
nonoptional type, points to inherent difficulties in this kind of tax 
legislation. The rates of the yield tax are not based on any clearly 
defined principles. In the first laws they were chosen apparently by 
guess or compromise. In many of the later laws they were obviously 
copied from some other State. In no State has there been any at- 
tempt to make these rates responsive to revenue requirements or to 
changes in rates of taxation imposed on property in general. The 
rates now in effect vary from 5 to 12% percent. The rate is 5 percent 
in 1 State, Ohio; 6 percent in 3 States, Louisiana, Massachusetts, and 
New York; 10 percent in 5 States, Alabama, Michigan, Minnesota, 
Pennsylvania, and Wisconsin (except for temporary lower rates in 
case of special classification); and 12% percent in 3 States, Idaho, 
Oregon, and Washington. In Connecticut and Vermont there are 
two rates, 7 and 10 percent, depending on whether at the time of 
classification the trees were over or under a specified age (10 years 
in Connecticut and 15 in Vermont), The 7-percent rates in Con- 
necticut and Vermont and the 12%-percent rate in Washington come 
into effect by degrees; all of the others are fully effective from the 
start. 
In general, the yield-tax rates imposed are so low that they allow a 
material reduction in taxes not only below what they would have 
amounted to under the property tax, but even below that of a net 
income tax imposed as a substitute for the property tax at an equiv- 
alent rate. Consequently it has seemed necessary to offset such 
