Plan of arrangement 
Special forest tax laws are grouped under four 
headings: (1) exemption and rebate laws, (2) 
modified property tax laws, (8) yield tax laws, 
and (4) severance tax laws. Modified property 
tax laws in turn fall under three subheadings: (a) 
modified assessment, (b) modified rate, and (c) 
deferred payment. The arrangement is similar to 
that used in the 1957 Digest except that the 
bounty and rebate group (of which only one rebate 
law remains in effect) has been merged with the 
exemption group. 
Individual tax law summaries are arranged 
under uniform headings within each of the major 
groups. Citations indicate where the laws may be 
found in the compiled statutes of the respective 
States or, in the case of more recent enactments, in 
the session laws. 
Explanation of terms 
Exemptions, as the term indicates, remove 
forest land and timber or the timber alone from 
the property tax rolls either for a term of years or, 
in some cases, indefinitely. To qualify for exemp- 
tion, forest tracts may need to comply with certain 
forest management requirements. Moreover, with 
respect to timber, the exemption may apply to all 
that standing on the tract or only to immature 
timber, planted trees, trees of particular species, 
trees planted for a specific purpose such as wind- 
breaks, etc. A rebate law permits the landowner 
to apply for abatement of taxes levied. Of the 14 
laws in the exemption-rebate group (table 1, fig. 
1), 6 are optional, leaving it to the landowner to 
claim the benefits provided; the remaining 8 are 
mandatory laws. 
Modified property tax laws of the modified as- 
sessment type total 13 in number (table 1, fig. 2). 
A fixed assessment per acre may be provided or, 
in the case of more recent legislation, assessment 
of forest land and timber at a “forest value” 
irrespective of a higher value in some other use. 
The four modified rate laws are varied but have in 
common the use of a tax rate that differs from the 
millage rate applicable to real property in general. 
The single deferred payment law would postpone 
a portion of annual ad valorem taxes until timber 
harvest. Of the 18 laws that make up the modified 
property tax group, all but 4 are optional in 
application. 
Yield taxes (table 1, fig. 3) are designed to aid 
forestry by relieving timber from payment of 
annual property taxes and imposing instead a tax 
at time of timber harvest. The forest land itself 
usually remains subject to the property tax, 
sometimes in modified form. Of the 18 laws in the 
yield tax group, 14 are optional and 4 are manda- 
tory. 
Severance taxes, similar in some respects to 
yield taxes but imposed solely for revenue pur- 
poses, are effective in six States (table 1, fig. 3). 
Three of these (Alabama, Louisiana, and Oregon) 
have also enacted yield taxes. Terminology is not 
consistent from State to State, and laws classified 
in this Digest as yield taxes are at times referred 
to in practice as severance taxes. Criteria used in 
classifying forest yield and timber severance taxes 
are listed in the tabulation that follows. 
Primary purpose 
of tax 
Relation to the 
property tax 
Basis of payment: 
Timber 
Bare land 
Responsibility 
for payment 
Yield tax 
To aid forestry by 
eliminating the annual 
tax on timber and sub- 
stituting a tax at time 
of harvest. 
Imposed in place of 
the property tax. 
Usually ad valorem, 
e.g., 10 percent of 
stumpage value. 
Remains subject to 
property tax, some- 
times in modified form. 
Rests upon the timber 
owner. 
Severance tax 
To obtain additional 
revenue (proceeds may 
be devoted to State 
forest program). 
Imposed in addition 
to the property tax 
(or to the yield tax 
if latter has been 
substituted). 
Usually specific, 
e.g., 50 cents per 1,000 
board feet. 
Not affected. 
Rests primarily upon 
the timber operator. 
Application of tax 
Usually optional although 
Always mandatory. 
mandatory in some instances. 
Nature of tax 
Gross income tax. 
4 
Occupation or privilege tax. 
