64 Iowa 140 | Iowa | 1884
The provision of the statute of the United States designed to prevent discrimination is in these words: “ The taxation (of national-bank shares) shall not be at a greater rate than is assessed upon moneyed capital in the hands of individual
Besides, the appellant’s shares, as the evidence shows, were assessed solely with reference- to its capital, including its surplus. They were not considered worth more than the amount of the appellant’s actual moneyed assets. The result was precisely the same .to the shareholders that it would have been if the bank’s capital, including the surplus, had been directly taxed, instead of the shares, unless, in taxing the capital, a deduction should have been made by reason of the form which a portion of its capital had taken by investment in non-taxable bonds. Aside from the consideration of such deduction, we think that the taxation to which the appellant was subjected was practically the same as is contemplated for savings banks. This position we understand the appellant to deny. Its shares, as we have seen, were estimated with refer
Referring to the statute in reference to the taxation of savings banks, we have to say that possibly it might be thought that it affords some ground for the appellant’s theory. It provides for the taxation of the paid-up capital. If we could see any reason for allowing that portion of a savings-bank’s capital to escape taxation which results from accumulated and reserved earnings, we might think that by paid-up cajiital was meant merely so much of the capital employed as resulted from payments made on subscriptions to stock. But, even then, we should hardly feel justified in holding the accumulated and reserved earnings exempt. Taxation is the rule, and exemption is the exception.
We come,'now, to the consideration that the taxation of national-bank shares is practically a taxation of its capital, including its non-taxable bonds. It is assumed, and perhaps correctly, that savings banks are entitled to a deduction for non- taxable securities held by them as a part of their capital. In respect to this we have to say, in the first place, that the national banking act contemplates that shares may be taxed, notwithstanding the practical result above mentioned. We are aware that it might be replied to this, so far as savings banks are concerned, that, if national-bank shares are taxed, savings-bank shares should be also. But this would not obviate the difficulty in question. Individual owners of national bonds cannot be taxed upon them. If it is objectionable to tax shares of national banks, while savings banks are taxed merely upon their capital, with non-taxable securities deducted, then national-bank shares cannot be properly taxed while-individuals hold such securities. If there is any seeming hardship in this,' it should be remembered that national banks have the advantage of their bills put in circulation, representing a large part of their capital, and which are not specifically taxable.
The claim that national-bank shares cannot properly be taxed, unless the shares of savings banks holding non-taxable securities are also taxed, is substantially disposed of, we
Aeeirmed.