FOREST TAXATION IN THE UNITED STATES 413 
or other local functions. The present tendency seems to be toward 
increased use of income taxes. This tendency is favorable to forestry 
so far as these taxes serve to reduce the burden of the property tax. 
DEATH TAXES 
Death taxes may take either of twoforms: (1) A tax upon the estate 
as a whole regardless of the number of the beneficiaries or their 
relationship to the testator or (2) a tax on the several shares into 
which the estate is divided for transmission to the beneficiaries. In 
this second form cognizance is taken usually of the relationship 
between each beneficiary and the testator. The first form is usually 
called the estate tax, the latter the succession tax or the inheritance 
tax. In either case the tax is, of course, imposed only upon such part 
of the estate as falls within the legal jurisdiction of the State imposing 
the tax. Death-tax rates are generally progressive, with respect to 
the size of the estate in the case of the estate tax, and with respect to 
both the degree of relationship of the several beneficiaries and the 
amount of the respective shares under the succession tax. The 
Federal Government uses the estate tax. The States generally 
employ the succession tax. 
The effects of death taxes on the forest owner and on the practice 
of forestry depend on the type of forest and the type of forest manage- 
ment. 
In the case of a small sustained-yield forest a moderate death tax 
might be paid out of income, with no unreasonable burden on the 
owner or adverse effect on the enterprise. In many cases, however, 
such a tax is greater than can be paid out of current income, thus 
necessitating either heavier cutting than is consistent with good 
management or the sale of a portion of the property. In either case 
the management of the forest on a sound basis might be disrupted. 
The effect of heavy death taxes on an old-growth forest being 
converted, or capable of being converted, to sustained yield would be 
similar. Either excess cutting or subdivision of an economic forest 
unit might prevent the attainment of a sustained-yield enterprise. 
In the case of immature or second-growth forests, the imposition of 
death taxes is still more likely to have a discouraging, if not deleterious, 
effect. Ordinarily it would be impossible to derive sufficient income 
from the forest to pay the taxes. Lacking other resources, the estate 
might be driven to a forced sale of a portion or of all the property. 
This would have the effect of increasing the severity of the tax, even 
though it did not affect the future management of the forest. 
The payment of death taxes on an old-growth forest being destruc- 
tively cut, or held for destructive cutting, would have no adverse 
effect on forestry. In the latter case, the owner would of course sus- 
tain a loss if he were forced to liquidate on an unfavorable market. 
It is because they impose, all at once, a comparatively heavy tax 
obligation, which may frequently exceed the current income of the 
forest, that the death taxes are capable both of working hardship upon 
those who inherit forest property and of interfering with the most eco- 
nomical ownership or management of the forests. Under reasonably 
moderate rates, this feature of death taxation is capable of correction 
or mitigation at least, by the simple device of spreading the tax pay- 
ments over a series of years. 
