The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1869-02-02
UNITED STATES SUPREME COURT.

The Income Tax C0nstitut f0nal-Its Nature
The Duty Of Assessors rs to r eturns Of In.
come Made I'm Coin.
The Fuc!hc Mutual Insurance Company Us
franklin SouR.-In this case the insurance
company made their return OF income in
coin, claiming that, as 1t was received In
that commodity, it should be returned and
taxed In the same. The assistant assessor,
however, reduced 1t to it's equivalent In cur
rency, and the collector exacted payment on that
and seizure - WAS made after which payment was
made under protest and the matter takep TO the
courts. The court below-the Circuit Court for
Caliiornia-were divided in opinion and GER
titled the following questions to this court,
among others OF less Observation-Disclosures under
the act OF Congress authorizing the issue Of United
States notes and for the redemption and funding
thereof &c, there does not exist between the gov
eminent OF the United States and the holder Of such
lar for dollar. as the equivalent OF coined money
In payment Of duties and taxes OF the character
OF those collected from the PLAINTIFF IN this case;
whether such notes are not property, within the
meaning Of the constitution OF the United States,
and whether the compelling OF payment OF taxes on
such increased amount would not be taking
private property for public use without just COM
Pensati0n; whether the taxes paid by the COM
4aps ana sought e DO the oack are ne
constitution, and therefore not legally levied,
DC. Mr. Justice Swayne delivered the opinion OF the
Court holding that the act OF Congress authorized
the assessment as made by the assessor and tn at 1t
required the company to pay the amount demanded
ana Q1lu unQ0r protest. IL also lelu tudL Lne lax
on incomes is not direct tax, but duty or excise
and therefore within the competency Of Congress to
impose and exact The other questions are deemed
to be sufficiently answered by the answers given
above being to the first and sixth questions Ger
titled
Nom Resident Aliens Not Required to Pay
Federal Taxes-State Jurisdiction to Impose
Taxes.
The Northern Central Railroad Company Us. John
C. Jdcacson.-This is writ OF error to the Cir
cult Court for the District of Maryland. The de-
PENDANT in error, foreigner and subject OF
Great Britain, sued the plaintiff in error for
s2,e5o, the amount of the coupons due on bonds
Of the company and held by him. Upon demand
made the company offered to pay the amount, less
five per cent income tax to the United States and
three mills upon each bond reserved to the State OF
Pennsylvania under the laws OF that State. Upon
the trial Of the case the plaintlf In error
gave IN evidence the deed Of trust or
mortgage securing the bonds and the articles
chaeea Sy the saes 81
wanna and Maryland, and the proceedings OF those
corporations authorizing and asserting to the egis
latiOn OF the two States erecting such union. The
Court was then asked to instruct the jury that by
force OF the act Of Congress holders OF bonds
~ Ys Were aSe to na pay sae
three mills additional tax. and On each
charged the jury that II they found from the
evidence that at the commencement OF the suit
the plaintiff was the lawful holder OF coupons
representing interest due on bonds OF the de-
PENDANT held by him, and that the plaintiff, when
he purchased the bonds, was British sub
Ject, and resided In Ireland, and that he
then resided there, the plaintiff was entitled
to recover the amount Of such coupons without
deductions. The verdict for the plaintiff in ac-
cordance with the view Of the Court. The company
brought the here by writ OF error where it Is
now held. Mr.. Justice Nelson, delivered the
opinion OF the Court, that, by a true con-
structiOn OF the internal revenue laws It was not
intended to tax the incomes OF persons other than
citizens Of the United States, wherever resi-
dent, and OF residents, whether citizens
or not; hence the stock Of the defendant In error
was not subject to the deductions made. As to the
power Of Congress tc make law taxing non-resi-
dent foreigners IN such cases. the Court expresses
no opinion. II Is also held that the tax imposed by
the State OF Pennsylvania cann0. be exacted because
the railroad In question Is Maryland corporation,
and the subject for taxation was, therefore, be-
yond the jurisdictonal limits OF Pennsylvania
Both debtor and creditor were outside OF her terri
tory, and neither OF them her subjects The judg-
ment below was affirmed. Mr.. Justice Clifford dis
sented holding that both the State and federal tax
were lawful and subject to be deducted as claimed
by the company. The case was argued at the last
term and by direction OF the Court reargued at the
present term,