What is a Mortgage?—A mortgage may be defined to be a species of conveyance of property—mainly real estate—for the species of conveyance of property—generally real estate—for the security of a debt, generally created by a loan of money, and can not be regarded as a complete, but rather a conditional or quasi-title of the property covered by the conveyance. It is not so much property as a deed; and neither is property except to the extent of the value of the paper and the labor of writing or printing it, and still both are very valuable as conveying rights to property. The property is the real estate conveyed or mortgaged, and a tax on the land and another tax on the deed, or a tax on the land and another tax on the mortgage which covers the land, will in effect be a double tax on the land. This tax may be made a quadruple tax: first on the land, then on the deed of the land, then on the mortgage which is on the land, and then on the lease which the landlord may grant to the tenant.
The following curious instance of hardship in taxing mortgages actually occurred in one of the counties of central New York under the existing system: A worthy farmer and his wife, finding themselves becoming incapacitated through age from taking practical care of their little farm, sold it for five thousand dollars, and allowed the purchase money to remain in the form of a mortgage, with the expectation of living on the interest paid annually by the purchaser from the profits of the farm. The town being very small, the fact of the sale and the consideration paid became known to every one, and the assessors were compelled, in opposition to their usual practice, to tax the old man to the full amount of the mortgage, as personal property. But the year in which this was done happened to be a year in which the town, anxious to avoid a draft of men for the army, to which the old man was not liable, put up the rate of taxation to more than the legal rate of interest, in order to provide sufficient money to purchase recruits. The result was that the poor old man and his wife found that not only was all their income from the mortgage swept away by the tax collector, but they were even obliged to go out for days' work, in order to pay a balance of taxation and provide means of support; and this, too, while the identical farm for which the mortgage was given was taxed at one fifth its true value, and other investments of other citizens of an invisible and intangible character undoubtedly escaped taxation altogether. And this we call equality in taxation.
Tax Indebtedness is to Tax the Borrower.—If any one doubts that a tax on indebtedness is a tax upon the borrower, or the property which the indebtedness covers, that question can be easily solved by an honest, uniform tax on all State, county, town, and city
