Hut tax

“ If his hut is built on private land, the landowner charges the native from $5 to $10 a year rent. Land for cultivation, however, is included in the rent of the private landowner. Some of the 84 public men of South Africa entertain the belief that if a heavier government tax were imposed on the native it would force him to work more—smoke him out, as it were. Just think of the snug income some Europeans who have from 100 to 300 huts on their undeveloped land are receiving from natives, as they collect from $5 to $10 for each hut. The native still pays the $3.50 government tax also. ”

“ Fourthly, by subjecting the people to the frequent visits and the odious examination of the tax-gatherers, it may expose them to much unnecessary trouble, vexation, and oppression:" to which may he added, that the restrictive regulations to which trades and manufactures are often subjected to prevent evasion of a tax, are not only in themselves troublesome and expensive, hut often oppose insuperable obstacles to making improvements in the processes. ”

“ Forestry must come some time, and its early coming is a thing greatly to be desired. And whenever we are ready to seriously undertake it we will find our present methods of taxation a severe handicap. Strictly enforced, according to the letter of the law, the annual tax on the full value of the land and standing timber is almost sure to result in excessive taxation, and the timber owner cannot count on the continuance of the present lenient enforcement of the law. Even if the tax might not be excessive, its uncertainty would be a serious obstacle to investment. ”

“ All improvements are exempt. All buildings, fencings, draining, crops, etc.—all value that has been added by labor, all live stock also and personal property; only the unimproved value of the land is taxed. Mortgages are deducted also in estimating the land taxes [297] as they are taxed to the lender. There is a small-estate exemption of $2,500, where the net value of the estate doesn’t exceed $7,500. So that if a farmer has no more than $2,500 of land value left after deducting improvements and mortgage liabilities from the value of his real property, he pays no land tax. ”

“ The inevitable tendency of the present system is continuance to pay on the land with speculative value for purposes other than forestry but abandonment of land valuable only for forestry, with destruction of the forest growth in either case, by purpose or negligence, because it means added cost of holding with no possibility of profit. Since the owner cannot be compelled to grow timber to be taxed at his net loss, no timber tax at all will be received by the community and its annual land tax will be confined to land worth holding without timber for purposes other than timber growing. ”

“ This would mean that when the owner of deforested land chiefly valuable to the community for forest production agrees to make it produce, he shall be taxed not on his effort but upon the results of his effort, and then exactly as other producers are taxed upon their results. He may pay tax upon his land, as other land owners do, upon its actual value, but without this value being enhanced for taxation purposes by reason of any crop thereon. ”

“ He would kick still more vigorously if he had to pay a tax also on the value of the standing crop, after having to pay too much on the land. "The Lord loveth a cheerful kicker."
With woodland the case is still worse. Each year the owner may have to pay a tax on the merchantable crops of many past years. It is as though the owner of plowland had to pay a tax on the value of his field crops twice a week throughout the growing season. When a full-grown tree is cut down or burned up in a forest fire, it may have been taxed 40 or 50 times over. ”

“ All increase of these taxes is a loss for them, and these taxes are heavier on the small proprietors than on the large, because their changes are more frequent. The tax on the farms, on the contrary, would bear more heavily on large estates."
"The tax on farms not affecting the owners of timber, would be made up by a tax on the felling, a very justifiable tax, for standing timber is landed property. Standing timber is often worth much more than the land on which it stands." ”

“ Of particular significance to the farmer, too, is the tremendous importance of forests as a source of tax revenue to help support state and county government. The cost of government is growing as our population grows. Taxable property grows mainly in the cities. Elsewhere we confront the problem of diminishing timber to tax and consequent heavier and heavier burden on farm property. It will be a bad situation for the farmer if the timber is all destroyed and he has to pay all the taxes, as well as a higher price for his buildings, fences and fruit boxes. ”

“ Such an influence may undoubtedly have disagreeable consequences if the taxes are imposed without discrimination or exclusively for a fiscal purpose, but it is entirely otherwise if wisdom and tact preside at their institution.”
“A tax on the rent of a farm would be much better than a tax on the land itself. Proprietors then could only avoid taxes by themselves improving their property. As it is, they merely collect the rents, and usually employ their surplus in unproductive expenditure, while the proprietary farmers voluntarily devote theirs to the improvement of the land.” ”

“ Next to fire the most serious handicap to the progress of forestry is our unjust method of forest taxation. Laying as we do a yearly tax on both the growing crop and the land, the burden of taxation makes the holding of land for a second crop prohibitive as far as the private owner is concerned. ”

“ An annual tax upon the land itself, exclusive of the timber, and a tax upon the timber when cut is well adapted to actual conditions of forest investment and is practicable and certain. It would insure a permanent revenue from the forest in the aggregate far greater than is now collected, and yet be less burdensome upon the state and upon the owner. It is better from every side that forest land should yield a moderate tax permanently than that it should yield an excessive revenue temporarily, and then cease to yield at all. ”

“ Such taxes fall very lightly upon land values, being drawn chiefly from commodities and from houses and other real-estate improvements. Being so large they must seriously impede the production of houses, commodities, etc. If such taxes could be completely abolished, is it not probable that the building of houses, the making of commodities, and industry generally would be greatly stimulated? According to Professor Harris’ estimates a land-value tax at four per cent. ”

“ The fact that where one delivers or agrees to give or transfer land, with all the fruits and revenues, it will be presumed to be a conveyance of the land, in no way supports the proposition that an indirect tax on the rental of land is a direct burden on the land itself. ”

“ Constitutional amendment and legislation should be invoked to permit a low fixed tax on cut-over land during the period of no return to the owner, the State to be compensated by a tax on the crop when cut. Obviously this inducement should be offered only to those holders of cut-over land who will reciprocate by furthering the object sought. The result of such a system would be not only perpetuation of the forest and its attendant industries and payroll, but also a far greater tax return than the present one of encouraging potential forest land to become worthless and non-taxable. ”

“ And here I cannot but refer to a most short-sighted policy which our Government has been pursuing in giving a factitious value to lumber made from our own timber, by a so-called protective tax on foreign lumber. While this has operated directly against the building interests of our own people, it, at the same time, has led to the more rapid destruction of our own forests; and, in thus giving protection to the capital employed in lumbering, it is removing the protection which our forests afford to the American agriculturist, thus damaging the people at large in a twofold manner. ”

“ But I pass from these considerations to approach the question whether the inclusion of rentals from real estate in an income tax renders such a tax to that extent 'direct' under the constitution, because it constitutes the imposition of a direct tax on the land itself.
Does the inclusion of the rentals from real estate in the sum going to make up the aggregate income from which (in order to arrive at taxable income) is to be deducted insurance, repairs, losses in business, and $4,000 exemption, make the tax on income so ascertained a direct tax on such real estate? ”

“ Nearly every valley has its bright, rapid stream, on which the hills descend on one side in abrupt and much caverned limestone cliffs, the other side being level and fertile. The people there, and doubtless everywhere, were taken up entirely with their own concerns, the new system of taxation under which a fixed tax in money is levied on the assessed value of the land meeting with their approval. ”

“ The rent is no more directly the outgrowth or profit of the land than the crops or the coal, and a direct tax upon either is only an indirect tax upon the land. While, within the cases above cited, it is a tax upon land, it is a direct tax only upon one of the many profits of land, and is not only not a direct tax upon the land itself, but is also subject to the other objection, that it is, in its nature, incapable of apportionment according to population. ”

“ In the first place, there is no classification of land within the State for taxation purposes. It is a generally accepted theory among experts in this matter at the present time that there is only one fair method of taxation which may be applied to land maintained by the owner in forest growth and that is that there should be a tax placed on the land which shall be an annual tax, and another tax placed on the forest crop when it is harvested. ”

“ A SUGGESTED SOLUTION These requirements can be met by legislation, following constitutional amendment where necessary, providing that where the owner of cut or burned-over land will contract with the State to insure reforestation and protection for a specified term of years, the State shall notify the county assessor that the land is separated for taxation purposes from any forest growth thereon. The land may continue to pay a fair dependable tax, but the crop shall not be taxed until harvested. ”

“ Certain states have applied this principle by legislation under which land to be used for growing timber can be classified so that the timber can be taxed separately from the land. The land there is taxed annually on its value, without timber. The tax on the timber is not paid until the crop is harvested. It is therefore a tax on the yield. In New York this yield tax is 5 per cent of the value of the crop harvested; Michigan 5 per cent of it; Massachusetts 6 per cent; and Vermont, Connecticut, and Pennsylvania 10 per cent, with different provisions for forests already established. ”

“ The proper means to prevent settlers from seizing upon more land than they can put to good use, and taking up too wide an arrangement, is not a high price upon fresh lands (which is merely to suck out the life’s-blood of the colonist just as he is about to commence the arduous combat) , but a low land tax per acre, rated permanently to three or more class qualities of soil. This is the only genuine tax,—should be the only tax, and made available to the whole government of the colony. ”

“ Sponsor amendments to the legislation on unused land to bring it into line with the Constitution, and regulate by means of incentives and penalties the underuse of land and its use in a manner incompatible with sustainable natural resources use and environmental conservation. Such amendments should include a new tax scale for the annual tax on unused land, imposing significantly higher taxes on privately owned unused and/or underused land. ”

“ A fixed tax of so much per cultivated acre, without distinction of value, would have effects directly the reverse. Taking no more from the best qualities of land than from the worst, it would leave the differences the same as before, and consequently the same corn-rents, and the landlords would profit to the full extent of the rise of price. To put the thing in another manner; the price must rise sufficiently to enable the worst land to pay the tax; thus enabling all lands which produce more than the worst, to pay not only the tax, but also an increased rent to the landlords. ”

“ Here there is no such assessment. It is well also to bear in mind, in considering whether the tax is direct on the land, the fact that if land yields no rental it contributes nothing to the income. If it is vacant, the law does not force the owner to add the rental value to his taxable income. ”

“ Also, the exemption of the products of farms and things consumed on farms from taxation will give a corresponding increased value to compensate for the "building-occupancy" tax. Tenants controlled by all-pervading natural laws can and will give increased rents, if their personal property is exempt primarily from taxation. ”

“ His landlord however would be differently situated, he would be benefited by the tax on his tenant's profits, as he would be compensated for the additional price at which he would purchase his manufactured commodities, if they rose in price; and he would have the same money revenue, if in consequence of a rise in the value of money, commodities sold at their former price. A tax on the profits of the farmer, is not a tax proportioned to the gross produce of the land, but to its net produce, after the payment of rent, wages, and all other charges. ”