Owing to the fact that interest on funded debt and dividends are paid out of the common fund derived from operation and investments, the amounts devoted to these items in the above statement are necessarily computations. That they are not underestimates is proved by the fact that the surplus would not permit of larger charges for interest and dividends paid out of net earnings. Any interest or dividends materially greater than the amounts stated above, not paid out of the rents accruing to leased roads as given, must necessarily be derived from other sources than transportation revenues, and has no place in railway accounts coming under the provisions of the Act to Regulate Commerce among the several states.
[IX]
TAXES
So far as taxes are concerned, seasons of prosperity, depression and marking time are alike to American railways. The burden of their taxation knows no recession but mounts steadily, absolutely, per mile and in proportion to gross earnings.
The 368 roads reporting to this Bureau owning 182,046 miles of line and operating 221,132 miles, of which 39,086 miles were leased, paid $82,650,214 taxes in 1909. The Commission's report for 1908 shows that the leased roads paid $5,881,352 taxes out of their rents. Putting a conservative estimate of $200 a mile on the 11,870 miles of line not represented in this report would add $2,374,000 to the above figures and bring the aggregate taxes paid by the railways of the United States in 1909 up to the striking total of $90,905,566.
How railway taxation has increased absolutely and relatively to earnings and mileage during the past twenty-one years is shown in the following statement:
| Taxes Annually and Relatively, 1889 to 1909. | |||
| Year | Taxes Paid | Per Mile | Percentage of Earnings |
| 1909 (Official figures) | $89,026,226 | $382 | 3.73 |
| 1908 | 84,555,146 | 367 | 3.53 |
| 1907 | 80,312,375 | 353 | 3.10 |
| 1906 | 74,785,615 | 336 | 3.21 |
| 1905 | 63,474,679 | 292 | 3.04 |
| 1904 | 61,696,354 | 290 | 3.12 |
| 1903 | 57,849,569 | 281 | 3.04 |
| 1902 | 54,465,437 | 272 | 3.15 |
| 1901 | 50,944,372 | 260 | 3.20 |
| 1900 | 48,332,273 | 250 | 3.24 |
| 1899 | 46,337,632 | 247 | 3.53 |
| 1898 | 43,828,224 | 237 | 3.51 |
| 1897 | 43,137,844 | 235 | 3.84 |
| 1896 | 39,970,791 | 219 | 3.48 |
| 1895 | 39,832,433 | 224 | 3.70 |
| 1894 | 38,125,274 | 216 | 3.56 |
| 1893 | 36,514,689 | 215 | 2.99 |
| 1892 | 34,053,495 | 209 | 2.90 |
| 1891 | 33,280,095 | 206 | 3.04 |
| 1890 | 31,207,469 | 199 | 2.96 |
| 1889 | 27,590,394 | 179 | 2.86 |
In this table the figures for 1909 are based on the monthly reports to the Commission and are subject to revision, but they are in substantial agreement with the estimate on the returns to the Bureau.
Observe that the highest ratio of taxes to gross earnings shown in this table was 3.84 per cent in 1897, when everything relating to railways, except taxes, was prostrated under the reign of receiverships that followed the panic of 1893. It was of 1897 that the Official Statistician recorded the fact that "70.10 per cent of outstanding stock paid no dividends, and 16.59 per cent of outstanding bonds, exclusive of equipment trust obligations, paid no interest."