There are one or two other things on the blackboard. You will see that I have noted a change in the program. I did that because I thought that possibly some people might be counting upon some particular subject. The taxation of natural resources, which is number three on the second session, is slated to come Tuesday morning. Senator Vaughan has wired that he is detained in Arkansas and won't be here until Wednesday, so that for the present we have thought it desirable to suggest that that be placed at number two of the tenth session, Thursday evening. At that session the program as arranged calls for the presentation of the report on the taxation of migratory live stock, and that will be substituted at tomorrow morning's session.

I want also to say that representative McFadden, chairman of the banking and currency committee of the House of Representatives representative from Pennsylvania-has found it utterly impossible, as we all appreciate, to get away from Washington, so that at the Wednesday evening session he will not be here. The session being on tax-exempt securities, we have thought so important that it should be handled, and in spite of the fact that the program is very full, we will attempt to go on with it. I see the arrival, for instance, of a gentleman who is very competent to deal with that subject, Mr. McKenzie of the farm bureau. I know he will be glad to help us in the treatment of that subject, among others; and it is quite likely that Dr. Adams of Yale will be here by that time.

Now, coming to the oratory, I have here a 41-page digest of the legislation in this country at the last session. This digest was prepared by William E. Hannon, and I think the members of the association and the delegates and those who are constantly having need of reference to tax laws, are greatly indebted to those who prepare these annual digests. It is in my own experience, and doubtless in the experience of many of you, of very great interest to be able to deal with comparative legislation in taxation. The mind instantly turns to another state when you are thinking of tax legislation. This digest has usually been read at a later session. It had occurred to us that possibly it would be of help if the high spots could be readily obtained here at this session, or at least very hastily referred to, so that people might begin to think about them and they might want to confer with some one from some other state and ask, how about a certain law that was passed by the last legislature, and therefore at the start of the meeting we thought that it might be helpful to have some sort of a summary made. Of course this arrived in the mail today with a letter expressing the regret of the writer, and therefore it has been quite impossible for me to make any adequate summary, and in reading this I will have to think a little ahead and read at the same time; therefore I shall

be somewhat halting and hesitating, because I have got to see what I am coming to as I am reading. It is one of those things that a tax man is able to do. He may not be an orator, but he sometimes can read between the lines or ahead of the lines. This is by William E. Hannan of the legislative reference library of the New York state library, a man of long experience in dealing with tax legislation and other legislation.

REVIEW OF TAX LEGISLATION IN THE VARIOUS STATES FOR 1922

WILLIAM E. HANNAN

Legislative Reference Librarian, New York State Library

Since the last conference of the National Tax Association ten states have held regular and five states extra or special legislative sessions. Each state, to a greater or less degree, made some change in its revenue system. The chief interest, however, is this year, as last, in the constitutional rather than in the statutory field of taxation. One state, New Mexico, adopted two amendments in November, 1921 and thirteen states will this year at the general or a special election vote upon amendments to the revenue sections of their constitutions.

CONSTITUTIONAL AMENDMENTS ON TAXATION ADOPTED 1921

New Mexico appears to be the only state that in 1921 voted upon amendments to the revenue section of the constitution. This state adopted an amendment which exempts the property of honorably discharged soldiers, sailors or marines, who served in the armed forces of the United States in any war in which the United States has been engaged. The amount of the exemption is $2,000. The second amendment has to do with the highway tax and provides that the legislation of the fifth legislature, which authorized the issue and sale of state highway bonds to aid in the construction of state highways, shall take effect without being submitted to the electors of the state. It is further provided that the total amount of such bonds shall not exceed $2,000,000.

CONSTITUTIONAL AMENDMENTS ON TAXATION TO BE VOTED UPON 1922

Arizona proposes a limitation of the state debt which shall not exceed four per cent of the assessed valuation of the taxable property in the state, and further requires that all bond issues or special assessments shall be submitted to the vote of real property taxpayers.

Arkansas desires to change the present constitutional limitation of a two-mills annual tax for school purposes by providing that

the legislature may fix the limits of such a tax by law. The amendment further proposes to remove the limitation placed upon the local electors in the raising of an additional tax for school purposes which is now five mills by providing that the electors may vote such an amount of tax as may be necessary for the building and maintenance of local schools. Any excessive tax raised for such purposes may be reduced by the quorum court of the county. A further provision would remove the present poll tax of one dollar and give the general assembly power to lay an annual per capita tax of a different amount on every inhabitant who has reached the age of twenty-one years.

In an entirely new amendment to the constitution Arkansas would provide that all personal property located within an improvement district shall be subject to assessment and taxation for paying the cost of such improvement and all bonded indebtedness. The county court and the municipal council determine the rate to be levied for their respective improvement districts, but it is provided that not more than ten per cent of the assessed value of the personal property may be collected for any one such district during one year. The county court or the municipal council may provide for the proportionate deduction of the tax on the real estate in such improvement district, not to exceed the amount levied on the personal property.

California will vote upon three amendments. One relates to the imposition of a tax in lieu of all other taxes and at a different rate upon all notes, debentures, shares of capital stock, bonds or mortgages not exempt from tax; a second amendment includes those released from active duty under honorable conditions in the class of veterans whose property to the value of $1,000 is exempt from taxation; the third amendment proposes a material increase in the rate of tax on public utilities and certain corporations.

Colorado would provide a four-year term, now two years, for all county officials. This amendment includes county assessors, and it is therefore important as a revenue measure as it will give county assessors four-year terms instead of the present unsatisfactory term of two years. This amendment is being strongly supported by the state tax commission of Colorado.

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By an initiative petition Colorado proposes an income tax amendment to the state constitution. This amendment is as follows All laws exempting from taxation property other than that hereinbefore mentioned shall be void. Provided, however, that the general assembly shall, and the people, acting through the initiative power reserved by them in this constitution, may enact laws exempting from all taxation, except an income tax, money, notes, credits, bonds, book accounts, tax sale certificates, debentures, other written evidences of indebtedness, and all corporate stocks

except the capital stock of banking corporations, and at the same time enact laws imposing a uniform or a graduated tax on any or all incomes; and reasonable deductions and exemptions may be provided in such income tax laws."

Delaware, in an amendment relating to the capitation tax, would strike out the word "male" so as to provide that such a tax shall be laid upon every citizen of the state of the age of twenty-one years or upwards.

Illinois in its new constitution adopted in convention June 28, and to be submitted at a special election, December 12 of this year, proposes several amendments to the revenue section of its constitution. The most important change is that relating to the income tax. The new constitution states that the general assembly may provide for a uniform and substantial tax on the income derived from intangible property in lieu of any other tax on such property by valuation.

A personal income tax is also provided for in that the new constitution states that a general income tax may be imposed upon all net incomes. If such income tax, which the assembly may enact. is graded and progressive, the highest rate shall not exceed three times the lowest rate. The income tax is to be levied and collected by the state, and in the case of the tax upon net incomes, the revenue derived therefrom is to be apportioned to the state and the local taxing bodies as the general assembly may prescribe, and in the case of the revenue received from the tax on the incomes derived from intangible property it is provided that there shall be used for state purposes the same percentage as is used from the total revenues from taxes by valuation and the residue shall be returned to the respective counties from which collected to be distributed among the local taxing bodies.

The new constitution further states that if a general income tax is imposed the general assembly may provide for: (1) an exemption of all household furniture and implements of agriculture or labor used as such without limit as to amount; (2) an exemption from income derived from personal service of not to exceed $1,000 to the head of a family plus $200 for each dependent child. under the age of sixteen years, and a further exemption of not to exceed $500 to any other person.

The new constitution of Illinois also would exempt from taxation certain classes of property and the income derived therefrom. Such property is as follows: public property; household furniture used as such up to $500 in value; parsonages owned and used as such; property used exclusively for agricultural and horticultural societies, not organized for pecuniary profit; incorporated societies of war veterans; cemeteries not held for private profit and property held for school, charitable or religious purposes.

Forest taxation is cared for by Illinois in a provision which states that areas devoted to forest or forest culture, may be classified for or exempted from taxation. The new constitution also retains some of the tax principles of the old constitution in that it is provided that taxes may be imposed on privileges, franchises, and occupations, uniform as to class, and the general assembly is authorized to levy taxes upon property by valuation so that every person or corporation shall pay a tax in proportion to the value of his or its property. It pro

Michigan will vote upon an income tax amendment. vides "for a tax of not to exceed four per cent upon net gains, profits and incomes from whatever source derived, which tax may be graded and progressive." Classification of proper persons, firms and corporations is permitted. The state tax commission opposed the limitation of the tax to four per cent and the insertion of the word "net" before "gains, profits and incomes".

Minnesota by an amendment seeks to provide for an annuai occupation tax in addition to all other taxes on all ores mined by any person or corporation; 50% of the tax to go to the state, 40% to the permanent school fund and 10% to the permanent university fund.

Mississippi, by a concurrent resolution at its legislative session this year, inserted in the state constitution the amendment adopted by the people in 1920 relating to the laying of a poll tax of two dollars on each inhabitant of the state between the ages of 21 and 60 years. The amendment exempts deaf, dumb, and blind, and those maimed by loss of hand or foot, and provides further that the board of supervisors of any county may increase the poll tax to three dollars on each poll. The tax is to be used in aid of the common schools.

Montana proposes an amendment which provides for a state board of equalization with the powers and duties of a tax commission.

Ohio proposes two amendments both the result of initiative petitions. One deals with the section of the constitution providing for the taxation of property according to value, and, according to the citizens committee on taxation, introduces the following new propositions: (1) No aggregate tax rate in excess of fifteen mills on the dollar can be levied without a vote of the people; (2) No rate in excess of one mill can be levied for state purposes; (3) Additional taxes must be authorized as to specific amounts, periods and purposes at a regular November election by two-thirds o those voting on the proposition, unless a majority of those voting at the election approve; (4) The limited levies are to be distributed by local boards. If composed of persons holding other offices, these must contain representatives of the county government, the muni