THE
BREVIER LEGISLATIVE REPORTS.
VOLUME
TWENTY.
INDIANA LEGISLATURE.
SPECIAL SESSION.
IN SENATE.
WEDNESDAY, March 9, 1881--10 a. m.The consideration of the bill [H. R. 204--see pages 196 and 202 of these Reports], a codification of all existing laws on the subject of taxation in the State, was resumed.
Mr. BROWN, from the Select Committee thereon, reported in favor of striking out Section 51, referring to gift book stores.
Mr. CHAPMAN thought the recomendation of the Committee should prevail. The section would be productive of litigation, and no doubt great injustice would grow up under it. If there could be any real revenue derived from its retention, he would favor the feature.
The Senate refused to concur in the report of the Committee by yeas, 22; nays, 24.
Mr. BROWN from the Special Comitte thereon, reported a substitute for Section 54. He stated the only difference between the substitute and the original section is that it limits the right to make inspections of books to the State and County Auditors and Boards of Equalization. It cuts off the vast army of Assesors and deputy officials. The Committee thought no wrong would accrue from reposing that power in such responsible parties.
The report was concurred in.
Mr. KRAMER moved to amend Section 56 by adding a proviso authorizing rebate of tax to the amount of indebtness to State trust funds. The person holding these moneys, as a general thing, can get no deductions, because they have no credits from which to deduct their indebtedness, and such should have the right to deduct their indebtedness to the State. This particular case of double assessments can be reached; many other cases can not. There is no unfairness in this proposition.
Mr. HEFRON thought this section ought to stand just as presented by the Committee.
The motion to add a proviso was rejected.
Mr. SAYRE moved to refer Section 57 to a Select Committee of three, because the condition of the Wabash and Erie Canal is different from what it has been in the past twenty or thirty years. In 1876 the Wabash and Erie Canal was sold under a decree of the United States Circuit Court, and it is now owned by a class of individuals claiming possession to the exclusion of everybody else. Along the line of this canal there are mills that have been assessed in the hands of lessees as improvements, but the canal itself has been exempt from taxation. The sale of this property embraced everything including the strip of land 180 feet wide, and also the mill privileges along the canal. While this property was in the hands of the State, of course it was exempt, but these mill priviledges were taxed. Not only should these mills and mill priviledges be taxed, but likewise the canal itself. For a distance of six miles in his County the claimants have sworn that the level is worth $30,000, and there are $1200 a year for rent paid for the water privileges. As before stated, inasmuch as the State has parted with all her interest in this canal under a judicial sale, and as it is now claimed as the property of private individuals, this section should be referred to a Special Committee with instructions to report by substitute or otherwise.
Mr. BELL'S understanding is that every species of property held by the Wabash and Erie Canal was, in the suit of Jacobs, sold under foreclosure of bonds. In the suit of Fleming, in 58th Indiana Reports, it is held that all this property passed into the hands of private individuals. In the case of Henry J. Rudisell, where the State condemned water power afterward leased, it was held all the water privilege rights were sold out also. That case, having been appealed, is now pending in the Supreme Court. In order that there may be no hasty action, he favored the motion to refer.
Mr. SHAFFER also referred to property along the line of this canal in his County now escaping taxation.
Mr. VIEHE regarded the section as useless.
The motion to refer was agreed to, and the Lieutenant Governor makes such Committee to consist of Messrs. Sayre, Hefron and Bundy.
Mr. MACARTNEY moved to substitute for Sections 58 and 59 the following: The undivided real page: 16[View Page 16] estate of any deceased person may be listed to the heirs of such person without designating any such heirs by name, until a transcript of partition, certified copy of will duly admitted to probate, or deed, be presented to the Auditor of the County wherein such real estate is situated, when such Auditor shall proceed to transfer the same upon the last appraisement list and apportion the same and the valuation thereof with all delinquent taxes to the several owners. He gave two or three reasons why this substitute should be adopted (inaudible at this reporters' table). The latter clause in Section 58 he regarded as palpably wrong.
Mr. MENZIES saw no injustice in the latter part of Section 58. The simplest way is for the State to go right on the land for the tax, and not hunt up the heirs and devisees.
Mr. SHAFFER saw no necessity for a change in this section; it is word for word the old law, and there has not been the least difficulty under it in collecting taxes. Section 44 of the present law corresponds with this Section 59.
Mr. KRAMER would favor the substitute if it went far enough. Parties paying taxes should have a lien on the land for the taxes so paid. It should be so amended or it should not prevail.
The substitute was rejected.
Mr. LANGDON desired to have the question of taxation settled at the earliest possible time. The trouble now is that this bill is a solecism built upon incongruities, and it ought to be carefully revised. The utmost that can be done here in open Senate will be patchwork. It is foolish to say this Senate can perfect this measure as it ought to be done in two months. The bill should be sent back to the Special Committee, which is composed of friends of the bill, that they may report what is new matter on which we can legislate, letting the old law remain as it is; presuming, as it has worked well, it should be allowed to stand. More time will be taken up in discussing old sections than ten times the amount of new matter. He offered a resolution to this effect, with instructions to report, at the earliest moment, the sections and parts of sections which are new and not a part of the present laws, and also what, if any, sections or parts of sections are repealed.
Mr. CHAPMAN submited that we have not time to recommit for the purpose of a general revision, if the bill is to be passed so it can be made available for the present year. Every one admits the present law is incongruous, and too bulky. He believed good work was being done by the Senate now, and the better way is to proceed.
Mr. TRAYLOR also considered the present procedure proper. If the resolution were adopted the Senate would have the same right to amend the old sections as it has now.
Mr. MENZIES regarded the adoption of the resolution as in effect killing the bill.
Mr. HEFRON thought a recommittal would expedite the passage of this bill, and so he favored the resolution.
Mr. BELL regarded the fact that most of this bill is the old law as the best kind of a reason why it should be amended. It is the worst kind a slip-shod law he ever saw--it must have been made up with scissors and paste.
The resolution was rejected.
Mr. SPANN moved to strike the word "pawnbroker" out of Section 68.
Mr. CHAPMAN opposed the motion.
Mr. MENZIES referred to the fact that this section is an old one which has stood for many years.
Mr. CHAPMAN saw no reason for retaining a foolish statute, even if it has remained the law for nine or more years. He desired to see statutes enacted that members could look upon with satisfaction when they grew old, and feel a pride in having taken part in the formation of them.
AFTERNOON SESSION.
A RECESS OF THE GENERAL ASSEMBLY.
Mr. HEFRON offered a resolution that when the Senate adjourn on Friday noon it adjourn till Tuesday at 2 o'clock p. m.
Mr. COMSTOCK made an ineffectual motion to strike out the word "Friday" and insert in lieu the word "Saturday."
On motion by Mr. GRUBBS, the word "evening" was substituted for the word "noon" in the resolution.
The resolution as amended was adopted.
ASSESSMENT FOR TAXATION.
The amendment pending at the noon recess [Mr. Spann's] was rejected.
Mr. HEFRON made an ineffectual motion to strike out interrogatory No. 2 in Section 70, the same matter being in another place.
Mr. VIEHE offered an additional interrogatory to make effectual interrogatory No. 2, when answered affirmatively.
Mr. TRAYLOR moved to strike out the interregatory concerning purchases of real estate "since April 1 next preceding," as unnecessary, and possibly would lead to listing some property twice.
Mr. CHAPMAN and Mr. HEFRON favored the motion to strike out.
Mr. WOOD said: "This interrogatory ought not to be stricken out of the bill. When real estate is sold and conveyed by deed, and the conveyance is not recorded, the land is still taxed in name of the former owner. How is the owner to remove this tax? By making proof before the is proper authority that he has sold the land. That is much trouble to persons who have sold their real estate, which can be avoided by retaining this interrogatory."
The motion to strike out was agreed to.
Mr. McCARTNEY moved to amend Section 73 so as to require deductions claimed from credits shall be "itemized by giving the name of the persons, companies or corporations to whom such indebtedness may be due with the amount due to each provided the number of such creditors shall not exceed ten, and if such number of creditors shall exceed ten then such itemized statement shall include the names of ten creditors to whom the largest amounts may be due, and such itemized list shall be verified by oath, etc."
Mr. LANGDON objected to the inquisition proposed by this amendment to Section 73, requiring an itemized statement of every account from one cent up to thousands of dollars, and it is impracticable, for in some cases it would take volumes upon volumes to record what is required by this amendment to be set forth and verified by oath.
The amendment was rejected.
Mr. TRAYLOR moved to strike out the words "with a view to profit" in line five. He insisted where money is deposited the owner should pay the tax thereon.
The amendment was agreed to.
Mr. KRAMER moved to amend the Committee substitute for Section 90 so that foreign Insurance Companies shall pay taxes semi-annually on receipts. Where great destruction of property happens, such Companies frequently break up and it is safer not to let the tax run longer than six months at a time. The people of the State pay taxes twice a year, and there is no reason why foreign Insurance Companies should be favored more than our own people. Then it not right to allow them to pay on receipts less losses actually paid. No citizen has a renduction for the losses incurred in his business.
Mr. BROWN also thought Insurance Companies should be required to make a semi-annual payment of their taxes. If a great fire should occur such it as has occurred in Chicago, Boston and other places in the latter half of the year which would cause some of these Companies to break up, page: 17[View Page 17] the tax would be lost to the State. He desired to be just to them and this is but just. He also favored the second division of this amendment, allowing no abatement of taxes for losses. These Companies can very well afford to pay this tax. They take out of the State somewhere from $1,000,000 to $1,500,000 a year, which they invest in business elsewhere, and can afford to pay their officers from $20,000 to $40,000 a year. Let this amendment prevail, and and these Companies will pay to the State from $75,000 to $80,000 a year, instead of the comparatively small tax they now pay. This amendmend is in harmony with the laws of other States. He would go as far as any one to see justice done to all enterprises, whether individual or corporate, but they should bear their just proportion of taxation.
Mr. LANGDON assumed as a proposition that the insurance business done here is a good thing for the people of this State, and done at the lowest rate. If the tax becomes onerous it will be put on the rates of insurance and will come out of the insured. The very minute it does noy pay capital to stay in insurance it will not go out. This tax should be a per cent. on the amount of the business done--in other words the profits. Whatever is realized over and above losses is the profit. The latter portion of the proposed amendment is not fair nor just to foreign companies.
Mr. SPANN was satisfied if the semi-annual statements of Insurance Companies are left out there will be a loss to the State of some $30,000, by adhering to annual statements; but the latter half of the amendment he would oppose, as being unjust. They should not be taxed upon gross receipts unless losses are deducted.
Mr. BELL--Merchants are taxed upon the amount of capital invested without respect as to whether the investment will be profitable or otherwise. These foreign Insurance Companies are placed on a vantage ground as compared with our own home Companies, and that ought not to be continued.
Mr. MENZIES--If these Companies have to pay $30,000 or $40,000 or $50,000 more of tax in this State are they going to lose it? They will place higher rates on property, and this extra tax will fall on the people of the State. This increased tax will fall upon the industrial pursuits. Taxing foreign Insurance Companies on their gross receipts exclusive of their losses will be protection enough for home Companies.
Mr. BROWN though there was a mistake in the impression that by taxing these foreign Insurance Companies they will make it up in additional charges on premiums. Experience shows the contrary. Competition is so great it keeps the prices down.
Mr. LANGDON demanded a division on the question.
The first part of the amendment, providing for semi-annual statements, was agreed to. The second division of the amendment, refusing a deduction of losses from gross receipts was agreed to by--yeas, 25; nays, 15.
Mr. VAN VORHIS moved, as a substitute for the report of the Committee upon Section 90, that the substitute for Section 90, offered by the Committee, as amended by the Senate, be adopted as a section of the bill, and inserted after Section 89 of the printed bill.
The PRESIDENT pro tem. [Mr. Chapman in the Chair], ruled this motion out of order as not germain to the subject-matter under consideration.
Pending the consideration of Section 78--
Mr. HENRY introduced a bill, [S. 334] providing for the reinstatement of records of Courts destroyed by fire, etc., which was read the first and second time under a dispensation of the constitutional rule, and referred to the Judiciary Committee.
The Senate then adjourned till to-morrow.
