Until 1905, when as a result of an amendment to the constitution state banks were authorized to be incorporated, the only banks in the state were national banks, private banks, and the state banks chartered under the Constitution of 1869. Special definition of the taxable personal property of banks has been found to be necessary. Under the legislation of 1876 they were taxable on their real estate and tangible personalty, and on so much of their other personal property as remained after deducting the sum of deposits, accounts payable, bonds or other securities exempt by national and state laws, from the sum of money on hand, in transit, or in the hands of others subject to draft, checks, and other cash items, bills receivable and other credits due or to become due, and stocks and bonds of every kind.3 The statutes in 1879 erroneously failed to include bills receivable and other credits, and this was not corrected until 1883.4 In 1883 separate provision was made for national banks. It was then required that some officer of a national bank should furnish the assessor with a list of the shareholders and the amount of the shares of each, and that shareholders should render to the assessors the number and value of their shares. National banks were required to render all real estate and personal property except such as was exempt by the laws of the United States.1 The method of taxing shareholders was unsatisfactory and was changed in 1885. It was then provided that each share of a national or of a state bank should be taxed only for the difference between its actual cash value and the proportionate amount per share at which the real estate was assessed.2 The Revised Statutes of 1895 made no distinction between state and national banks, but there was later an amendment to cover this error.3 There was frequent complaint that banks, especially private banks, evaded taxation, but in 1897 a penalty was provided applying only to national banks for failure or refusal to furnish to the assessor a statement of the assets and liabilities of the bank.4

1 Laws of 1907, p. 316. Rev. Civil Stats., 1911, art. 4775.

2 Laws of 1911, Reg. Sess., p. 216.

3 Laws of 1876, p. 279.

4 Comptroller's Report, 1881-2. Laws of 1883, p. 111.

Though the chartering of state banks, savings banks, and trust companies was authorized in 1905, there were no corresponding changes made in the tax laws until 1911. State and private banks were taxed by one method, national banks by another. In 1911, however, the same method was applied to both state and national banks, which is that the real estate is taxable to the banks, while the shares are taxable to the shareholders at their actual value less the proportionate amount per share at which the real estate is taxed.5 Bank shares may not be assessed at a greater percentage of their true value than other property is assessed. Because of the ease of assessment of bank shares, there is no form of intangible property which is so completely reached for taxation as are they. The growth of banks in the state has been phenomenal and has tended to simplify the taxation of monied capital.1

1 Exempted by the laws of the United States were United States bonds, United States notes, and national bank notes. Rev. Stats, of U. S., 3701. In 1894 United States notes and national bank notes were declared subject to taxation under state laws. 28 U. S. Stats. L., 278. Restrictions on the taxation of national bank shares were that it should not be at a greater rate than was assessed upon other monied capital in, the hands of individuals and that the shares owned by non-residents of a state should be taxed only in the city or town of the location of the bank. 13 U. S. Stats. L., 99; 15 U. S. Stats. L., 34. U. S. Rev. Stats., 5219.

2 Laws of 1885, p. 106. Rosenberg v. Weekes, 67 Tex., 578 (1887). Gillespie v. Gaston & Thomas, 67 Tex., 599 (1887).

3 Laws of 1895, Reg. Sess., p. 38.

4 Comptroller's Report, 1888. Laws of 1897, p. 157.

5127 S. W. Rep., 1083. "Instructions to the Tax Assessors," issued by the comptroller's department, 1911. Rev. Civil Stats., 1911, arts. 7521-7522.