528 MISC. PUBLICATION 218, U. 8. DEPT. OF AGRICULTURE 
United States in 1922, 20 billion, or 11 percent, was tax-exempt (2/3, 
p. 18). Moreover, the amount of exempt real estate has, during the 
past 50 years, been steadily increasing both absolutely and relatively. 
The exemption from the property tax of so large a part of the 
Nation’s real estate has become a problem of importance, affecting 
the revenues of the taxing jurisdictions and the weight of the burden 
upon such property as is not exempt. This is a problem which of 
course touches all classes of property, including the forests. There 
does not appear to have developed any very clear theory of tax 
exemption in the United States. Whatever the theory may be, 
there can be little doubt that much of the present exemption is with- 
out justification. To the extent that property now exempt could be 
restored to the tax list, there would be the possibility, at least, of 
reducing the burden upon property now taxed. So far as the forests 
are concerned, the effect of such change would of course be adverse 
in the case of forest property which is now exempt but would be favor- 
able to forests in general, which are now subject to the property tax. 
On the whole, there can be no doubt that the forests suffer along with 
other property generally through the exemption from taxation of 
so large a part of the total real estate of the United States. 
PREDOMINANCE OF THE PROPERTY TAX 
The property tax occupies a unique position in American State 
iti Thich it has held with remarkable 
tenacity during all the changes, economic and fiscal, which have 
taken place since colonial days. In spite of all these changes, and 
in spite of the recent development of a number of other sources of 
revenue, the property tax still remains the most important single 
source of State revenue, producing about one-fifth of the total reve- 
nues of all the States, and almost the sole reliance of the local govern- 
ments, producing more than three-quarters of their total revenues. 
The property tax in the United States is a heritage of colonial days, 
and there can be no doubt that this form of taxation was better 
suited to social and economic conditions in the eighteenth and early 
nireteenth centuries than to those which prevail today. A consider- 
able body of opinion holds that the American tax system is defective 
in thus leaning so heavily upon the property tax. If this is a defect, 
it follows that those forms of property which are subject to the 
property tax may be bearing an unjust burden, which would be 
relieved if the demands of government were met by wider use of 
other forms of taxation. Whether this reliance on the property tax 
actually is a defect in the American tax system, and precisely what 
would be the effect upon taxable property of a readjustment which 
would place greater reliance on other forms of taxation, are broad 
questions whose investigation is outside the scope of this inquiry. 
It need only be pointed out here that just so far as present reliance 
on the property tax places an unjust burden on property, to that extent 
forest property along with other property has ground for complaint. 
Obviously, it would be quite impossible to measure the extent to 
which forest property is today overburdened on this account. The 
possibilities of relief to forest property through development of other 
forms of revenue which might diminish the relative importance of the 
property tax will be discussed in a later section. 
