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as intangible property in other states, so that the states thereby have an opportunity of collecting tax on issues of other states.

The United States has no power of taxation of intangibles, but it has other forms of taxation, and one of the most deplorable forms adopted, to my mind, was the amendment which permitted the taxation of income. People who were opposed to it, or who had any thought of opposing it, said it did not greatly matter; that the imposition wouldn't be very great; that they would not suffer under it; but as a result of the United States income tax, the residents in four or five states of the United States are paying the majority of the income tax.

Now, don't run away with the idea that the inhabitants of those states don't get something back from the others. New York happens to lie at the gateway of the United States, and the people of New York City levy a tribute on the whole country, on account of the volume of traffic that goes through there; so that when you are attempting to saddle the collection of your taxes upon a few people, they are going to collect the taxes back again, and they are going to charge you something for the privilege of doing it. Had we insisted upon a more direct taxation, or sales tax, it would have been more equitable and adjustable; it would have cost one-tenth of the income tax, and people would gradually have adapted themselves to the idea that they were willing to pay their own bills.

Now, our farmer friends come here with a desire to take away somebody's income. They are not going to profit by that sort of business. If they are successful in it, they will destroy industry.

H. C. MCKENZIE: Allusion has been made to the farmer. I take it that that means me. I just want to call the attention of this assembly to the fact that if the gentleman who has preceded me had his way, the bulk of the taxes that have been collected in recent years would come out of sales taxes instead of out of incomes; and I just want this body for a minute to consider what the effect would be in the United States of America if we put a tax on food, fuel, clothing, and shelter, and then exempted from taxation the men with incomes of $300,000 and up. Think that proposition over, gentlemen. If you want to turn this country Bolsheviki, within the next ten years, just take his advice.

CAPTAIN WHITE: I should like to rise to object to the inference that I am here defending a principle for the benefit of any particular class of our community. I am here to oppose what I think are wrong tendencies in taxation; tendencies that will ultimately be detrimental to our country. I am not at all an advocate of the very rich man.

C. J. BUELL: I have generally been an opponent of the income

tax, since it was first broached, and I am not satisfied yet that the income tax is a solution of this problem; but I cannot let the gentleman's remarks pass without calling. attention to one or two things.

The enormous fortunes that have been piled up by those people in New York and which are now being tapped by the income tax, to my mind furnish a very strong argument in favor of the income tax; that it really does reach those fellows and gets something out of them. Most of those fortunes, moreover, are of a character, and the effect of the income tax upon them is such that no matter how much you take away from them, they cannot pass it back to the consumer. It simply diminishes their net income, and that is the merit of the income tax, as applied to them. In their case it is a case of a tax that does not fall on the consumer.

Now, the income tax is not of that character all the way through. A part of the income tax is of such a character that it can be passed on to the consumer. Take the great landlords of New York, take the Astor estate, and Astor does not live in this country at all. I think the income tax is so fixed that it gets Mr. Astor, doesn't it? MR. MCKENZIE: Some of his real estate.

MR. BUELL: Yes, and it ought to get it, because he hasn't anything to do with the making of the value of that real estate; not a particle; no more than you or I, not a bit. The public made that value, and whatever the public can get out of it, they ought to have. We have a lot of millionaires in New York

CHARLES J. TOBIN (interrupting): Mr. Chairman, I want to interrupt for a minute; I don't think this place is a forum where citizens of New York may be maligned and criticized. We are supposed to be here discussing principles of taxation. I want to say that it was unfair on the part of Captain White to say that New York is taking tribute from everybody that passes through. We ought to confine ourselves to the subject at hand and not indulge in personalities. And I object strenuously to the speech now being made, and I think it should be stopped.


MR. BUELL: There is no more forcible way to bring out a principle than to show just exactly how it will work in particular cases. I will eliminate "Mr. Astor "-you can put anything you please in. That is not a personal matter at all; it simply amounts to this; that the income tax is getting a large amount of revenue from people that you ought to get it from. That is all I want to say about it.

(Call for the question)

CHAIRMAN LORD: Are you ready for the question?


CHAIRMAN LORD: All in favor of the adoption of this resolution will signify by saying aye.

(Ayes and noes, one vote against)

CHAIRMAN LORD: I declare the resolution adopted, in accordance with the rules of the conference.

The Secretary will read the next resolution.


Whereas, it is recognized that a uniform rule of apportionment. for taxation purposes, of the net business income of mercantile and manufacturing concerns, whose business is conducted in more than one state, is essential, in order that fairness and equity may prevail,

Therefore be it Resolved, that the fifteenth national tax conference hereby urges the adoption of a uniform rule by states, calculated to fairly and equitably apportion such net business income.

CAPTAIN WHITE: I move the adoption of the resolution.

(Motion seconded)

CHAIRMAN LORD: Moved and seconded that the resolution be adopted; are you ready for the question?

(Call for the question)

CHAIRMAN LORD: Are there any remarks?

(No response)

CHAIRMAN LORD: All in favor of such resolution will signify by saying aye.

(Ayes and noes, unanimous)

CHAIRMAN LORD: The ayes appear to have it; the ayes have it, and the resolution is adopted.

The secretary will read the next resolution.

SECRETARY HOLCOMB: The next resolution in the order in which it appears here is by the Committee on the Taxation of the Shares of National Banks. (Reading):

Whereas, The existing law regarding the taxation of the shares of national banks places a limitation upon the tax which may be imposed by the states which is out of harmony with the present tax laws of some twenty states and which must tend to discourage more improved methods of taxing intangible personal property in all the states, and

Whereas, a considerable amount of litigaton has already been undertaken in relation thereto which, if successful, will place the

national banks in a favored class among taxpayers; BE IT HEREBY Resolved, that the national tax conference favors the speedy amendment of section 5219 of the United States Revised Statutes. so as to provide that the tax imposed upon the shares of national banking associations shall not be at a greater rate than is assessed upon other moneyed capital employed in the business of banking, and to confirm to the states the right to assess or re-assess any taxes heretofore paid, levied or assessed upon the shares of national banks, which were levied at no greater rate than those levied upon similar state institutions; as is provided, for example, in the Kellogg bill, S. 3696.

MR. TOBIN: Mr. Chairman, I move to amend the resolution by offering the following substitute. I should like to have a few moments to speak to my amendment after the same is seconded.

MR. E. F. COLLADAY: Mr. Chairman, I second the motion. CHAIRMAN LORD: The secretary will read the proposed amend



Whereas, The existing law regarding the taxation of the shares of national banks places a limitation upon the tax which may be imposed by the states, which is out of harmony with the present tax laws of some twenty states and which must tend to discourage more improved methods of taxing intangible personal property in all the states, BE IT HEREBY

Resolved, That in the opinion of this conference, the respective states should be permitted to tax national banks, or the shares thereof, or the income there from, according to such systems as they may consider desirable, provided that such taxation shall not be at a greater rate nor impose a heavier burden than is assessed or imposed upon capital invested in general banking business and the income derived therefrom, and hereby recommends the immediate amendment of the Revised Statutes of the United States, so as to permit the principle thus stated to be embodied in said Revised Statutes.

CAPTAIN WHITE: I second the amendment.

CHAIRMAN LORD: It has been moved and seconded that the amendment be adopted; are there any remarks?

MR. TOBIN: I should like to speak to the question of the amendment.

CHAIRMAN LORD: I recognize the gentleman who proposed the amendment.

MR. TOBIN: I might explain to begin with that I have accepted

the preamble as found in the resolution offered by the committee on resolutions, but have stricken out the entire second part of the resolution which reads as follows (reading):

"A considerable amount of litigation has already been undertaken in relation thereto which, if successful, will place the national banks in a favored class among taxpayers."

My point there is that if we are to censure national banks we shall inaugurate a scheme of resolutions, to censure anybody, or any group of taxpayers who see fit to contest a particular tax. It must be well understood that if a tax is in dispute or in litigation, until some new form of taxation is adopted, that class of taxpayers is not to be considered favored. They will be in their old place until a change is made, and I do not believe that it is the province of this conference to censure, or to say that people who believe in their particular principles or who contend that they are right, should not have the privilege which is accorded everybody, to litigate. Here we say that if this litigation is successful the bank will be put in a favored class. That will be entirely misunderstood as it goes out to the public.

Everybody realizes that if the Supreme Court of the United States follows the decision in the Richmond case, it will necessitate a change in our plan of taxing banks, but that would be true if we were litigating the special franchise tax law of New York, or if we were litigating any particular section of the tax law of New York.

The people will think that the class of taxpayers included in the act are being favored. I think the word favored" is entirely incorrect, and that it will surely create a false impression as to the work this conference is doing throughout the country. I believe that language of this sort should not find its place either in the resolution proper or in any preamble of the resolution, and I have taken it out.

S. S. KALISHER of Pennsylvania: Is that the only change?

MR. TOBIN: No; I want to explain as I go along. Now, when we come to the resolution proper, I object to it in form. The resolution, as drawn, places this conference on record for a particu'ar piece of legislation. I have gone through the records of the conferences; gone back over many of its reports; and I find that this is the first time that a conference has attempted-I will put it this way-has attempted to favor particular legislation. If we will just bring ourselves back to the purpose and intent of this conference and of the constitution of the association, we shall find that its purpose is clearly stated in the constitution. It is to formulate and announce, through the deliberately expressed opinion of the conference, the best economic thought.

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