Staunton Vindicator And General Advertiser

Taxing State Bonds.

The Richmond Enquirer in the course of a strong article against the policy and the justice of taxing the State's Bonds, has the following remarks:

Virginia bonds are now quoted in Richmond at 94. The State and corporation taxes imposed on Virginia sixes amount together to 1.40 per cent. on the bonds themselves—thus leaving to the stockholder a net revenue of only $4.60 on every $100 worth of securities in his possession. Now $4.60 is the exact amount of one year's interest, at six per cent., on $76.66, and if Virginia sixes were now quoted at 76 at Richmond, they would really be at par. Instead of this, they are quoted at nearly 94—i. e. nearly thirty three per cent. above par.

This is a calculation which a child could understand. The inference is unavoidable. that stocks yielding but 4.60 per cent. and standing at 94, would inevitably rise above par, if the interest were raised to six per cent.

And what is the result of the tax on State credit? Plainly this: the State must either consent to sell her bonds below par, and thus enter upon a course which will tend to the further depreciation of her credit, and tax her citizens to pay a heavy surplus in addition to the amount actually applied to the benefit of the State—or the State precludes her own citizens from the purchase of stock, and becomes entirely dependent on the stock markets of other States or of foreign nations.