One of the most important factors in connection with the consideration
of woodlots is the matter of taxation, and this is a matter which
so far as Kentucky is concerned, has had little attention. In the
first place, there is no classification of land within the State for
taxation purposes. It is a generally accepted theory among experts in
this matter at the present time that there is only one fair method
of taxation which may be applied to land maintained by the owner in
forest growth and that is that there should be a tax placed on the land
which shall be an annual tax, and another tax placed on the forest
crop =when it is harvested=. In no other manner does it seem probable
that reforestation of suitable areas throughout the State may be
accomplished, since in the first place, on account of the character of
the investment the owner of the land must be assured before hand just
what his taxes on the land are to be, and in the second place the risks
attendant upon the raising of a forest crop, because of the long period
of years before it reaches maturity, make it essential that the crop of
forest products shall be taxed at maturity when it is harvested, rather
than that an annual tax shall be imposed. Certain States have already
gone a long ways in this direction and Pennsylvania has recently
passed three laws dealing with the matter of forest taxation and the
classification of forest land which embrace the best features of recent
thought on this subject. The essentials of the recent Pennsylvania laws
are as follows:
1. Classification of suitable land set aside by the owner for forest
purposes as auxiliary forest reserves.
2. Agreement with the State to maintain such land in forest growth and
penalties for failure to carry out agreement.
3. Assessment of land classified as auxiliary forest reserves at $1.00
per acre annual tax.
4. Payment by owner of 10 per cent of the value of the forest products
when harvested to the county to be distributed among the proper county
funds.
5. Fixed charge on auxiliary forest reserve land of two cents per acre
for schools and two cents per acre for roads.
Under these provisions it is obvious that the growing of timber on
suitable areas would be reduced to a practical business basis.
Providing the tax question is sufficiently settled and definite for a
period of years the regeneration of the woodlot or the establishment
of one may be undertaken as a safe investment. So far as Kentucky
is concerned, the present tax laws and the manner of handling the
assessments in the counties are not such as to bear heavily on timbered
or wooded areas. In the event that a new classification of land is made
and new tax laws enacted every effort should be made to bring about
such a classification of forest land and such a system of taxation as
will encourage the reforestation of suitable areas and the regeneration
of the present woodlands.