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Chittenden, Alfred K. (Alfred Knight), 1879-1930 / The taxation of forest lands in Wisconsin
(1911)

Probable returns from forest investments,   pp. 56-61 PDF (1.5 MB)


Page 57


THE TAXATION OF FOREST LANDS IN WISCONSIN.
not considered holding their cut-over lands for a second cut.
While a high rate of assessment on cut-over land is, of course, less
of a burden to a timberland owner than a high rate of assessment
on timbered land, provided he owns a considerable area of both
classes, it is still an increasing burden as his area of cut-over land
increases with the cutting of timber. If the owner intends to hold
his cut-over land for a second cut, it will take a period of .,0 or 60
years, or possibly longer. Such a burden of taxation upon the land
becomes of great importance and may result not only in a loss on
his investment, but also may amount to more than the actual value
of the land itself long before the rotation period is up.
  Three tables have lecn prepared to show what the probable profit
or loss will be at given periods on pine timber grown under both
the present method of taxation, and the method proposed later in
this report where the land is taxed annually and the timber when
it is cut. In the absence of data showing the yield per acre of
pine in Wisconsin, it was necessary to use yield figures based upon
growth and volume studies for the same species in other states.
Stumpage values are, of course, variable, but the figures used in
these calculations are considered conservative if applied to tracts
not over three to five miles from a railroad, and they are especially
conservative when consideration is given to the probable rise in pine
stumpage during the next fifty years. The total stumpage value
per acre is expressed in the column headed "'returns.'"
  As a rule, young stands of timber in Wisconsin are not now con-
sidered in fixing assessed values. It is, therefore, assumed that
for the first thirty years under the present method the timber is ex-
empt from taxation. The land, however, for that period is taxed.
Only non-agricultural land was considered, and its value assumed
to be $2 per acre in Tables 1 and 2, and $2.50 in Table 3. An an-
nual tax rate of one and cnc-half per cent on full valuation is used
in all the tables. The tax burden resulting from such rate on full
valuation will be approximately equivalent to the present tax burden
now borne by timberlands in northern Wisconsin. The tax on the
yield is fixed at 10 per cent. According to the calculations in these
tables, this is the highest rate which could reasonably be applied.
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