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In this State we find established the general property tax system the attempt to subject all property to taxation by means of one uniform tax on all classes of property.

During the last decade a persistent effort has been made through legislation and the improvement of the assessing machinery of the State to perfect this system, bring it into harmony with modern economic conditions, and apply it equitably to all forms of property. The keynote of the application of this system is the assessment of all property at its actual cash value, following the rule laid down by the United States Supreme Court in a case from Indiana familiar to all its assessing officers, that “what property of any kind, corporate or individual, tangible or intangible, is worth for income or sale, it is worth for taxation.”

Methods for assessment of various kinds of property are fixed by law in minute detail.

There is little distinctive or new in the system as established, but there has been an organized effort on the part of the legislature and taxing officials to secure greater uniformity of assessment, discovery of property and correct valuation thereof, and modification of competitive undervaluation by local assessors.

It was designated by one public official as “ a practical business system, and not a hotchpotch;” but this statement must be regarded as applicable to the system for assessment by taxing officials rather than to the system of taxation as a whole. The system of assessment in actual practice comprises the township or ward assessor; the county assessor, elected to devote his entire time to the supervision of local assessments; the county board of review, which assesses the property of certain corporations for county purposes, and to which appeal lies from the assessment of township assessors; and a State tax commission, the head of which is the governor of the State, which assesses the property of quasi-public corporations and has supervision over county assessments, and to which appeal lies from county boards.

The valuation of the property of railroads and other public-service corporations, so called, for the purpose of taxation, is determined by the State board and apportioned among the several counties of the State in which such property is located, according to mileage, for entry and taxation with other local property at a uniform rate. This board, in compliance with the mandatory provisions of law, aims to value the property and capital stock of such corporations at its full market value upon the basis of earning capacity.

Through these varied methods of valuation it is designed to bring all the propperty of each county upon the tax duplicate at its full value, and to extend the taxes at a uniform rate for State, county, and local purposes.

The revision of the system in 1891 was calculated to bring about a reform in the execution and enforcement of the tax laws for the valuation of property, rather than a material change in the system of taxation.

The provisions of the Indiana tax laws have been frequently assailed in the courts, and in the main sustained, so that there is now little question as to the right and authority of taxing officers to assess and tax all forms of property as provided in the laws.

The law of 1891 provides that all taxes shall be assessed on polls and property, listed and valued in an equal and ratable proportion, except such stocks and other property as may be specifically taxed.

The amount necessary to be charged for State expenditures and school purposes is fixed by law, and the amount to be charged for county expenditures is determined by the board of county cominissioners.

The amount of taxes raised in 1899 for State and local purposes was about $20,000,000.

It has been held that the constitution does not require a uniform method of valuation of property for taxation, but only such method as will insure a just valuation; and further, that it is not necessary that the rate of taxation shall be uniform throughout the State, but it is only required that the rate of assessment and taxation shall be uniform and equal throughout the locality in which the tax is levied.

The law requires a poll tax to be assessed upon every male inhabitant of the State between the ages of 21 and 50 years. The levy fixed by the legislature for State purposes is 50 cents for the general fund and 50 cents for the school fund on every poll. The amount of poll tax in 1899 was $560,838.


All property not expressly exempt is subject to taxation. What shall constitute real or personal property for taxation is specifically defined. Little need be said as to the taxation of real property. It includes all lands within the State and all buildings and fixtures thereon and appurtenances thereto, except in cases otherwise expressly provided by law. This class of property is assessed by the local assessors, and for the purpose of assessment is divided into four separate classes, viz.: Lands, improvements on lands, city or village lots, improvements on city or village lots. Mortgaged real estate is assessed to the mortgagor while in his possession, and at its full value, with the following exception:

In 1899 a law was passed by which the owner of land may have the amount of any mortgage theroon not exceeding $700 and not more than one-half of the assessed valuation of the land deducted from the assessed valuation of such mortgaged premises. Such mortgagor is required to make a statement showing the name and residence of the mortgagee, which is used by assessors for the purpose of taxing the mortgagee.

The amount of deduction in the State under this law in 1900 was $29,159,931, while the total gain of taxable property, exclusive of mortgage deductions, was $31,723,152, or a net gain of $2,563,221.

The total valuation of real estate in 1899 was $860,365,972, or about 24 times the valuation of the personal property, and the average rate of taxation was, roughly speaking, $1.50 on each $100 valuation.


Personal property, for the purpose of taxation, includes all visible personalty within the State belonging to inhabitants; all such property belonging to inhabitants of the State but situate without the State, except the property actually and permanently invested in business outside the State; all indebtedness of every kind due to inhabitants of the State above the amounts respectively owed by them; all shares in corporations organized under the laws of the State, when the property of such corporation is not exempt or is not taxable to the corporation itself; all shares in banks organized in the State, deducting the value of real estate taxed to the bank; all shares in foreign corporations, except national banks, owned by inhabitants of the State; all moneys, including notes and certificates, circulating as currency; all annuities and royalties.

It is the express purpose of the law throughout to enable assessors to reach for taxation all property belonging to inhabitants of the State in whatever form it may exist or wherever it may be located, at its full value. Methods for the discovery and valuation of property are provided with much detail, and these provisions have been generally sustained by the courts.

It has been held to be within the legislative power to make money, stocks, and choses in action outside the State and belonging to residents of the State taxable in the State, and where a business of buying and selling property, making loans and investments is conducted and the notes and mortgages so used retained in the State, although the owner thereof may have his residence in another State. the property and business are subject to taxation in the State whether such busines is conducted by the owner or his agent.

Corporate stock and franchises, except where some other provision is made by law, are assessable locally at full value, but shares in corporations all the property of which is assessed to the corporation, are relieved from taxation in the hands of the shareholders.

Obligations secured by real-estate mortgages are regarded as personalty, and assessed to the owners as credits at full value and local rates.

There seems to be a united and determined effort to bring notes secured by mort. gage and other obligations and credits upon the rolls. Through the individual listing of obligations by creditors and debtors, the cooperation of local and State boards, record evidences of mortgages, and other means, assessors seek to discover as much as possible of this class of property and subject it to taxation. For this purpose rigorous power is given to the assessors for the discovery and listing of such property, and inquisitorial methods are provided by law.

There is a law requiring the assignment of mortgages to be placed on record within 45 days. It has been declared by the supreme court to be a settled law that township assessors, county assessors, the auditor of State, boards of review, and the State board of tax commissioners, for the purpose of listing property for taxation, have the right to inspect and examine the records of all public offices and the books and papers of all corporations and taxpayers in the State, and may enforce such right by writ of mandamus; and that the county auditor may maintain an action on the part of his county to set aside the final settlement of a decedent's estate within 3 years, and subject such estate to the payment of taxes on property fraudulently concealed by the decedent in his lifetime. Thus the sin of the tax dodger committed during his lifetime may be atoned after his departure from the “Hoosier” to a taxless state.

In 1899 the supreme court affirmed a judgment of $1,800 recovered by the officers of a county as a penalty on account of the returns of false and fraudulent schedules of property for taxation.

It has even been advocated by assessors, the governor concurring in the suggestion, that all notes be made by law uncollectable in the courts unless they bear upon their face the stamp of the tax assessor.

Interstate cooperation, for the purpose of facilitating the discovery and assessment of mortgages and other sequestered obligations, has also been suggested by State tax officials in their conferences.

There has been established a system of deductions of indebtedness of taxables from the various forms of credits, undue advantage of which, according to statements of officials, is to a great extent taken by owners of that class of property, thereby taking from the tax duplicates a great deal of property that should be taxed.

The total valuation of personal property in 1899, including property and capital stock of domestic corporations and all shares in banks, was $315,540,675.

The provisions for the discovery and assessment of personal property being a distinguishing and important feature of the Indiana system of taxation, it is essential to set forth the methods employed.

For the purpose of properly listing and assessing property for taxation and equalizing and collecting taxes, the township assessor, county assessor, board of review, auditor of State, and State board of tax commissioners each have the right to examine and inspect the records of public offices and books and papers of all corporations and taxpayers in the State, and all assessors and other officers charged with the duty of listing property for taxation are required to give in writing all information they may obtain regarding the concealment of property from taxation by any person or corporation to the county auditor or board of review, to the auditor of State or State tax commissioners.

Each taxable is required to give a minute detailed statement of all the various items of personal property owned or held in trust by him, the blank schedule provided for that purpose containing 100 different items, and to affix what he deems the true cash value to each item for the guidance of the assessor.

The determination of the valuation of each item is made by the assessor, who may, if he deems it necessary, examine the taxable under oath, and must be governed by what is the true cash value, particularly defined to be the market or usual selling price at the place where the property is, and if there be no market value, the actual value governs.

Every company, association, or person not incorporated for banking purposes who engages in the business of lending money, receiving money on deposit, buying or selling bills of exchange, notes, bonds, or stocks, or other evidence of indebtedness, with a view to profit, is required each year to furnish the assessor a detailed statement of his business and property, to be listed for taxation in a manner specially provided.

Severe penalties are imposed for false statements, and any prosecuting attorney, upon notification of such statement, is required to prosecute the offender to final judgment and execution, receiving himself, in addition to his regular compensation, 10 per cent commission on all money so collected and a docket fee of $10 to be taxed against the offender. In case any taxable refuses to make out a statement or subscribe to any oath required, the assessor ascertains as best he may the number and description of articles and property belonging to him, and the value thereof, and the county auditor adds to such valuation 50 per cent thereof.

For the purpose of listing and assessing property for taxation an assessor is elected in each township for a term of 4 years, whose duty it is to assess the real and personal property in his township as particularly provided by law, except that assessed by the county assessors or State board, as hereafter set forth. All real estate is assessed once in 4 years, and each year the assessor assesses any improvements made thereon and notes and lists all changes found since the preceding assessment.

He also assesses all the personal property he can discover by the rigorous methods specially provided, except capital stock, which is assessed by the county board, and property of quasi-public corporations, assessed by the State board.

The returns of these local assessors are made to the county auditor, who, if satisfied that any real estate or personal effects have been omitted, may authorize and require the proper assessor to correct any error or omission, but can not increase the assessment of property as returned, although purposely undervalued.

Once in every 4 years a county assessor is elected in each county, who is not eligible for reelection more than twice in any term of 12 years, and who devotes his entire time to the duties of his office. Such county assessor receives all returns of real and personal property made by the several local a?sessors in the county, together with the assessment lists, securities, statements, maps, and other papers filed, and it is his duty to make a careful examination of the tax duplicates of the county, and also of all other records and papers in the offices of the county auditor, treasurer, recorder, clerk, sheriff, and surveyor, local assessors' books, all omitted assessable property of every kind or nature, including tax certificates, mortgages, debts, judgments, claims, and allowances of courts, legacies, and property in the hands of administrators and other trust officers, and for that purpose has all the rights and powers given by law to local assessors for the examination of taxables and their property and the discovery and assessment of the same, and he may list and assess any omitted property that he may so discover at any time during the year. Such county assessor is also required to advise and instruct all township officers in his county as to their duty under the laws, and for that purpose must visit each local assessor each year. In short, the county assessor has supervision over all local assessors and their work, with full power to list and assess upon the rolls all property omitted by the assessors under him; and he and the local assessors constitute an organized force for the discovery and assessment of property.

There is also an annual county board for the review of assessments and valuation of real estate and personal property in each county, composed of the county assessor, county auditor, and county treasurer, with 2 freeholders appointed by the judge of the circuit court, the county assessor being president and the county auditor secretary of said board of review. Such board has power to hear complaints of any owner of personal property except“ railroad track” and “rolling stock,” to equalize the valuation of property, and to correct any list or valuation as it may deem proper and necessary to fix the assessment at its true cash value.

It corrects all errors in names of persons, descriptions of property, and the assessments and valuations thereof, and causes to be done whatever may be necessary to make the lists and assessments comply with the law, and where it appears that any property owner had bona fide indebtedness, the same is deducted from the amount of his credits listed in the county, and he is assessed only on the residue of his credits fixed by the board of review.

It is also the duty of this board to inquire as to the valuation of the various classes of property in the respective townships and divisions of the county and make such changes as may be necessary to equalize the same as between the townships, but it has no power to reduce the aggregate valuation of all the townships below the true cash value nor to increase the same beyond the amount actually necessary for a proper and just equalization. It is also the duty of the board to value and assess for taxation the capital stock, franchises, and privileges of certain private corporations, as hereinafter set forth under the head of corporate taxation.

There is also a State board of tax commissioners, consisting of 2 skilled and competent persons, not more than 1 from the same political party, together with the governor, secretary of state, and auditor of state—the last 3 being ex-officio members, and the governor being chairman, It is the duty of this board

First. To prescribe all forms of books and blanks used in the assessment and collection of taxes.

Second. To construe the tax and revenue laws of the State and instruct them in relation to their duties with reference to taxation and assessments whenever requested so to do by any officer acting under any other person interested therein.

Third. To see that all assessments of property are made according to law.

Fourth. Especially to see that all the railroads and other corporations of the State are assessed and taxed as provided by law.

Fifth. To see that all taxes due the State are collected. Sixth. To enforce penalties prescribed by any revenue law of the State for disobedience of its provisions.

Seventh. To determine, whenever necessary, the amount r :quired to be levied upon property in the several counties to cover any deficiency in the State revenue not otherwise provided for.

Eighth. To examine all books and accounts and all persons necessary to enable it to obtain all information required to aid in securing a compliance with the tax laws by all persons or corporations liable to taxation.

Ninth. To make such rules and regulations as it may require.

Tenth. To report to the general assembly at each session the amount of revenue collected in the State for all purposes, classified as to State, county, township, and municipal purposes, with the sources thereof, and such other matters of information concerning the public revenues as it deems of public interest.

Eleventh. To make investigation concerning the revenue laws and assessments of other States and countries, and with the aid of information thus obtained and of its own experience and observation to recommend to the general assembly, at each session thereof, such amendments, changes, or modifications of revenue laws as it may deem advisable.

Twelfth. To see that each county of the State is visited at least by 1 member of the board as often as once each year to hear complaints and collect information concerning the workings of the tax laws. Said board, or any member thereof, has the power to subpoena and examine witnesses, and has access to and power to order the production of any books or papers in the hands of any person or corporation whenever necessary in the prosecution of any inquiry made in an official capacity.

Any taxpayer who may be dissatisfied with the action of the county board of review has the right to appeal from such board to the State board, and in like manner any township or county assessor or member of the county board has the right to appeal to such State board from any assessment or order of the county board. It is also the duty of the State board, and it has exclusive authority, to value and assess for taxation all railroad property denominated for that purpose “ railroad track”and improvements thereon and rolling stock," and all property belonging to telephone, telegraph, palace car, sleeping car, drawing-room car, dining car, express and fast freight, and other associations transacting business in the State, and for that purpose, and to hear appeals and applications for revisions and assessinents and equalize assessments of real estate, the board is required to convene annually at a stated time.


Having completed the description of the main features of the tax system of Indiana relating to the assessment of real and personal property generally, the discovery and listing thereof, and the assessing machinery of the State from the local township assessor to the State board of tax commissioners, we turn now to the subject of general corporation taxes.

As we have already observed, there is no distinct or separate system for the assessment and taxation of such property, it being a part of and mingled with the general property tax system of the State.

The laws for the assessment and taxation of corporate property are designed to reach and bring it all upon the tax rolls with all other property, upon the same basis of valuation and the saine local rates of taxation, the practical result depending upon the judgment and action of the local assessors.

The real estate and tangible personal property of corporations, except as specially provided for by law. are assessed and valued for taxation by local assessors, the same as other real and personal property of their respective localities, and the capital stock and franchises by county boards.

While substantially all classes of corporate property are valued and assessed upon the several couniy rolls and extended for taxation with other property at the same rate, we shall consider each separately.


The shares of capital stock of any bank are assessed to the owners where the bank is located and taxed at the rate at which other personal property in the same locality is taxed. The officers of each bank are required each year to make out a statement under oath, in duplicate, showing the number of shares of capital stock, true cash value of each of said shares, and also the true cash value of the entire capital stock of the bank, and such bank stock is thereupon listed and assessed in all respects the same as similar property belonging to other corporations and individuals. Real estate and other tangible property assessed to the

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