THE TWO PER CENT TAX.
Last week there was held in this city an important convention of fire underwriters. Over 150 companies sent representatives to participate in the proceedings, and to weep over the demoralized condition of the insurance business. Among other things complained of was the excessive and unjust taxation to which insurance companies are subjected in the various Slates. Not the least of the grievances complained of is the two per cent tax on gross premiums to which they are subjected for the support of Firemen’s Relief Associations. This was set forth as being a great hardship imposed upon the companies and unjust, because it constitutes a tax upon a special class. Resolutions were adopted condeming all taxation of this character, and a committee of fifteen was appointed to endeavor to secure the repeal of these laws. This convention organized itself into a permanent body, whose object it is to reform the evils from which the business of underwriting is suffering.
This action is of importance to all Firemen in those States where the two per cent law is in operation. We do not question but the underwriters will make a determined effort this coming Winter to have the law repealed. They argue that the law is unjusf, inasmuch as it imposes unequal taxation upon citizens, for, of course, whatever burden of taxation is laid upon the companies is at once charged back to the policyholders. Therefore, if a propertyowner, being prudent, insures his property, paying premiums to the amount of $100, he is assessed, (through the company) two per cent on this amount for the support of the Firemen’s Relief Fund. His neighbor, however, who owns property equally valuable, and receives equal fire protection, but who does not insure, escapes this two per cent tax. Therefore, the underwriters claim the tax is discriminating against the prudent and careful citizen in favor of the imprudent and reckless one. These underwriters are particularly solicitious about the rights of citizens ! They claim to have no interest in the matter, and to be actuated solely by a desire to see fair play between citizens. This is transparent bosh ! As a matter of fact, this two per cent tax does not effect insurance rates one iota. Policies are written for the same price in those States where this tax is levied as they are in States where it is not levied. Repeal the law and rates would not be lowered a single fraction of a cent. It is pure and unadulterated selfishness that induces the insurance companies to desire the repeal of this law. No taxpayer objects to it, no one has asked to be relieved from its operation. It is a source of great benefit to a deserving class of persons, and the money thus collected is expended mainly in relieving the necessities of the wide ws and orphans of men who spend years of their lives fighting fire in the interests of the insurance companies. That these companies, and no one else, should now seek to destroy these Relief Funds, and rob these widows aud orphans of the small amount each can receive from them, is a mean and paltry act that few men would care to father. If the law is unjust and unequal, it is unconstitutional, for the constitution declares that taxation must be equal. If it is unconstitutional, the companies have but to make a case, carry it to the courts and, if they are right, the courts will relieve them from the burdens imposed by it. That they do not contest it in the courts, is very good evidence that they do not regard it as so unrighteous as they pretend, and have little confidence in being able to have it set aside. They prefer to go to the various legislatures, where their influence is more potent, and there secure the repeal of a law which is most beneficient in its operations, and against which no protest, save their own, has been raised.
We warn the Firemen to be on the alert to circumvent any movement that may be made by the underwriters to rob them of their Relief Funds. They should call the attention of their members of legislatures in advance to the proposed action of the underwriters, and see that they intelligently comprehend the benefits that are secured by this law to the widows and orphans of Firemen. We know that the underwriters are a power in the land, but we also know that the Firemen are greater and more powerful than they if they choose to assert themselves. Every Fireman who is personally acquainted with a member of a legislature should direct his attention to this matter without delay.