FOREST TAXATION IN THE UNITED STATES 565 
the average property-tax rate, interpolated, if necessary, for rates not 
shown. If the property-tax rate were 1 percent or 2 percent, the 
corresponding yield-tax rate would be 13 percent or 23 percent, 
respectively. ‘This method has the disadvantage of being rather com- 
plicated for incorporation in a law, since a schedule of yield-tax rates 
to fit all possible property-tax rates would have to be adopted. 
A simpler method of providing for a yield-tax rate which would vary 
with an average property-tax rate would be to establish by law a con- 
stant ratio of one to the other. For example, assume rotations and 
tax rates as described in the preceding paragraph. Since rotations 
from 30 to 50 years would be the rule, it may be seen from the first part 
of table 150 that the yield-tax rate corresponding to a property-tax 
rate of 1 percent would vary from 8 to 17 percent, while that corre- 
sponding to a property-tax rate of 2 percent, would vary from 15 to 
29 percent. The law would then require that the yield-tax rate be 
determined by multiplying the property-tax rate by a given constant, 
which might be placed at any figure between 9 and 14 in order to give 
results well within the range of variation indicated by table 150. 
The particular constant could be determined by averaging the ex- 
tremes, or it could be set arbitrarily nearer either extreme, at the dis- 
cretion of the legislature. In view of the wide margin of uncertainty 
in determining the average or typical rotation on the basis of objective 
facts, any loss in accuracy from this modification is more apparent 
than real. Only a very rough determination of the equivalent yield- 
tax rate is possible, whether taken from table 151 or computed directly 
from the property-tax rate by means of a ratio based on table 150 in 
the manner described. 
While these methods would determine a yield-tax rate that might 
be considered roughly appropriate to second-growth forests, this rate 
would have no particular validity for old-growth forests. Where such 
forests are not an important element in the tax base, administrative 
convenience would suggest the extension of the second-growth rate to 
old growth. Under other conditions, it would seem necessary from 
the revenue viewpoint to make the rate high enough not too sharply 
to reduce the taxes on timber asaclass. The effect on the tax burden 
of the individual property would depend on the length of time the 
timber was held before cutting. ‘Timber subject to immediate or 
early operation would be more heavily burdened than under the 
property tax; timber held in reserve for sufficiently long periods, more 
lightly. For example, if a yield-tax rate of 10 times the property tax 
rate were adopted, the owner of an old-growth forest would have to 
plan the holding of his timber for a period greater than 11 to 13 years 
in order to expect a tax burden below what it would be under the 
property tax, assuming that a net annual increase in value of 3 per- 
cent and moderate costs of protection and administration were 
anticipated. 
STATE OR LOCAL RATES 
The yield-tax rate might be determined either at a uniform figure 
for the entire State, or at independent figures for each county or 
town. Convenience of administration would dictate a single State 
rate, while a more exact correspondence to the property tax basis 
would suggest separate county or town rates. Separate rates would 
carry the further advantage of giving the benefit of a lower yield-tax 
rate to timber located in jurisdictions where tax rates had been kept 
