SEPARATION IN NEW YORK
NEW YORK, following the precedent set by Pennsylvania,1 embarked in 1880 on a policy of corporation taxation which led eventually to almost complete separation.
The general property tax was at this time--and had been for some years-supplying the state with most of its revenues ($6,169,700 in 1879, which was 87 per cent of the receipts of the general fund of that year, and 99 per cent of all taxes).2 This tax did not, however, become an integral part of the New York tax system in the early history of the state, as was the case in the New England states. Although regularly used by the localities before 1850 it was employed by the state only in case of emergency. Thus it was levied in 1799 when large borrowing for current expenses made it necessary for three years; and again in 1815 when it was resorted to to pay off the large debt which had accumulated as the result of the policy of borrowing money to meet appropriations whenever they exceeded revenues.3 Having paid off this debt in 1826, the tax was discontinued in spite of large canal expenditure and growing yearly deficits.4____________________