(9) All annuities yielding annually over two hundred dollars. (10) All stages, omnibuses, hacks, cabs and other vehicles used in transporting passengers for hire, except steam and street passenger railway cars.

Excepted generally from the provisions of the act are building and loan associations and savings banks having no capital stock, fire companies, firemen's relief associations, life or fire insurance companies having no capital stock, secret and beneficial societies. labor unions, labor-union relief associations and beneficial organizations paying sick or death benefits.

The above enumeration of the subjects of taxation does not follow the language of the act, but is an attempt to show the practical effect of its provisions. The provisions of the act are very much involved, due in large measure to the retention by the state of the tax of four mills upon scrip, bonds, certificates and evidences of indebtedness issued and assumed by domestic and foreign corporations and issued by municipal, school and poor districts and counties of the state. It is further involved by the exemption of assets in the form of bonds, etc., of corporations, limited partnerships and joint stock associations liable to a state tax on capital stock, and by the exemption of manufacturing and laundering companies from the payment of a state tax on capital stock.

The law could be much simplified by a return to the system existing prior to 1913, whereby the state collected this entire tax and returned part thereof to the counties.

The law presumes that every taxable should make an annual return under oath of the subjects in his possession liable to the tax, and special printed forms are furnished for this purpose. However, there is gross negligence on the part of the taxing authorities in checking up returns, and many false returns are either deliberately or inadvertently made.

Practically no returns are secured showing interest bearing bank deposits, such as savings accounts and certificates of deposits, because taxing authorities have no access to bank records, and banks are in the habit of advising depositors that they are not liable to the payment of the tax.

The following table shows the yield from this tax to the several counties for the year 1921:

A study of this table shows that the law is administered with more success in some counties than in others. The following will serve as an illustration. Some allowance is to be made for difference in wealth of communities; especially is this true of Montgomery County:

The amounts secured by the State of Pennsylvania for the year 1921 from this tax on intangibles is as follows:

(a) From scrip, bonds, certificates, and evidences of indebtedness, issued or assumed by private domestic and foreign corporations

(b) From scrip, bonds, certificates, and evidences of indebtedness, issued by counties, cities, boroughs, townships, school districts and incorporated districts

Total

$4,490,890.09

786,292.01

$5,277,182.10

The tax upon indebtedness of private corporations is collected directly from the corporation and not from the individual owning the security. It can, therefore, be accurately collected. In the case of the indebtedness of municipal districts the tax is collectible in the first instance from the holder, except where the indebtedness is issued free and clear of all taxation, in which case it is payable by the district. Practically all municipal bonds in Pennsylvania are issued free and clear of all taxation.

Pennsylvania is not in a position to discontinue this tax on intangibles and to adopt in its stead the income tax. While our con

stitution permits classification of subjects of taxation, it at the same time prohibits the granting of exemptions. Until such time as a constituional amendment is adopted, the tax on intangibles must be continued.

The combined state and local revenue from this tax for the year 1921 exceeded $13,000,000. If the language of the act were simplified so that the ordinary citizen might comprehend its provisions; if banks were forced to disclose interest-bearing accounts, and if taxing authorities were diligent in checking up returns, there is no reason why the total income from this source should not reach $20,000,000 a year.

[The following statistics received from Chairman Beck of the Maryland State Tax Commission are included as of interest.—Ed.]

THE MARYLAND INTANGIBLE PROPERTY TAX LAW

Statement by W. W. BECK, chairman State Tax Commission of Maryland 1. The intangible property classification tax in the State of Maryland is 45c. per $100.00 (30c. for local purposes and 15c. for state purposes).

2. The tax is imposed upon the following property, providing it be dividend or interest bearing:

"All bonds, certificates of indebtedness or evidence of debt in whatsoever form made or issued by any public or private corporation incorporated by this State or any other State, territory, district or foreign country, or issued by any State (except the State of Maryland), territory, district or foreign. country not exempt from taxation by the laws of this State, and owned by residents of Maryland, shall be subject to valuation and assessment to the owners thereof in the county or city in which such owners may respectively reside, and they shall be assessed at their actual value in the market. . . . All shares of stock or shares in any bank other than a national bank, or in any company or corporation incorporated by or located in and doing business in any other State, or District of Columbia. or in any territory or foreign country owned by residents of this State, shall be valued and assessed for the purposes of State, county and municipal taxation to the owners thereof in the county or city in which such owners may reside, and said shares shall be assessed and valued at their actual value in the market."

3. The total assessment on securities for the year ending 1921 was $273,218,009.

4. The classified tax in the State of Maryland certainly has met all expectations.

CHAIRMAN BULLOCK (continuing): Then do you decide to adjourn at this time and go to the luncheon which we have about ten minutes to reach, or to continue?

CAPTAIN W. P. WHITE: Move we adjourn.

CHAIRMAN BULLOCK: I want to announce merely that the luncheon will be held at Donaldson's Tea Room, on Sixth street and Nicolet avenue, in the department store.

I won't put the motion. The session is adjourned.

(Adjournment)