608 MISC. PUBLICATION 218, U. S. DEPT. OF AGRICULTURE 
CONCLUSIONS 
The principal advantage of the differential timber tax plan is its 
simplicity. It requires but little change in the existing tax system in 
that it involves no new kind of taxation, no material change in tax 
machinery and records, no new concept or method of determining 
value, and no carrying forward from year to year of tax liabilities or 
allowances. Nevertheless, it has most of the important features de- 
sired in a special forest- tax plan. It would reduce the obstacle im- 
posed by the property tax to the development of timber-growing 
enterprises from cut-over land or immature stands by either materially 
reducing or entirely eliminating the excess burden of the property 
tax. It would also permit the retention of old-growth timber for 
future disposition without incurring any excess tax burden if the 
postponement of cutting were not too long deferred. It would afford 
substantial relief from the ordinary property tax no matter how long 
cutting were deferred. 
The adoption of this plan would cause no immediate loss in local tax 
revenues that would be serious, and its ultimate effect on tax revenues 
in forest districts should be favorable. 
In view of the above considerations, the differential timber tax is 
offered as a simple method of so modifying the property tax system as 
to make it appropriate to the peculiar conditions that characterize 
forest properties in this country. 
IMMATURE-TIMBER EXEMPTION 
THE PLAN AS PROPOSED 
Search for a remedy for the defects of the property tax as related 
to forests has led to consideration of another plan for adjusting the 
property tax, which proposes that the disadvantage to the deferred- 
yield forest inherent in the perfectly administered property tax, which 
was pointed out in an earlier section of this part (p. 525), be offset 
by exempting from taxation the value of immature timber. This 
plan was formally endorsed by a committee on forest taxation of the 
National Tax Association in 1922 (286, pp. 183-134). The plan was 
described by this committee as follows: 
The only problem remaining is to find a modification of the property tax which 
shall be suited to the peculiarities of forest enterprise. The weaknesses of the 
ordinary property tax as applied to growing forests have been carefully studied 
* * * Referencehas * * * been made to the generally accepted remedy, 
namely, the combination of an annual tax on the land and a yield tax. As has 
been pointed out, the annual tax on the land, at the rate of the ‘ordinary property 
tax, is all the burden that can fairly be placed upon the growing forest. To im- 
pose an additional yield tax is excessive. Those who have proposed this have 
apparently had the feeling that to grant entire exemption of growing timber, 
without any compensation, was too great a concession or else have had in mind 
the mature forests, which as we shall show must be called upon for more than the 
land tax. As regards growing forests there is no principle either to justify a yield 
tax or to measure its amount, if the land is already subject to annual taxation 
like other property. Such an additional yield Les is justified only in considera- 
tion of a reduced rate of the land tax. * * 
* %* * The simple solution becomes Se hari and not unduly burdensome; 
i. e., the annual tax on the land only, at the regular rate of the property tax, with 
entire exemption of growing trees. ‘No additional yield tax is required so far as 
the property tax is concerned. 
This plan was adopted by California in 1926 through a constitu- 
tional amendment (State constitution of California, art. 13, sec. 12%) 
