Delaware state journal. [volume] (Wilmington, Del.) 1870-1883, 1870-07-01


In TIE SENATE OF THE UNITED STATES,
June 20, 1870.
The Senate having under confederation the bill tH
X No -045 20 reduce internal taxes, and for other pur
posts
Mr.. BAYARD said:
Mr.. PRESIDENT In 1861 the first income
tax under law OF the United States was
levied at the rate OF three per cent. on all
gains and profits whatsoever, and from what
ever source derived. The exemption then
was 5000. In 1868, l believe, this act was
amended and the tax increased to five per
cent on all incomes under So, 900 and to ten
per cent. on all sums over $4,000 in the way
of income.
There was under that law a new, most un-
Just, and unjusti6able discrimination against
property per Sc, II was discrimination
against the measure Of property. 1t was de-
fensible on no ground upon which laws
should ever rest. IL was in effect punish
ment for the possession of wealth, and tend
ing 10 deter men from following successfully
all those pursuits which wise public policy
is disposed to encourage.
In 1867 this law was again amended, con-
fessedly at all times enacted as war mea-
sure, and as one justified only by the press
ing emergencies Of the time; and 1t was ex-
pressly enacted on the 2d OF March, 1867
"That the taxes on incomes herein imposed shall be
levied the ist day Of March, and be due and payable
on o. before ne SON day Of April in each year. until
and Including the year 1870, and no longer"
This tax then expired by lis own hmita-
tion. Section one hundred and sixteen OF
the same act declared that
THE herein provided for should be paid the
gans profits, and income Of the year ending lhe sls'
collecting, and paying the same"
By a reasonable, indeed by necessary
construction OF these two sections OF this act,
the income tax was no longer collectible
after the lst day OF January of the present
year.
The proposition now is that this dead law
shall be revived, without the pretexts for its
continuance that were urged as good reasons
for its original passage. II is urged upon
upon the Senate now that this temporary
measure, enacted as war measure, as one
growing out Of the necessities OF the hour,
shall become permanent law in this coun-
vsrEy, 81, ,I5I1 iNs, sps,.,. wee s'is '-,,ca
TO continue this tax for the entire year 1870
by Joint resolution, carried through the
lower House of Congress under the opera
lion of the previous question and brought
here to the Senate. 1t was called up during
the morning hour, but objected To, and dis
cussed by gentlemen on this side OF the
Chamber, and finally withdrawn. We now
have a proposition to continue this system
perpetually, at the'rate Of three per cent.
upon all incomes in excess OF So GOO, let the
sources oi those incomes be what they may.
Now, sir, the income tax was in It's origin
and intent tax upon accumulated property.
7. was tax upon wealth, which in the
country of the origin Of this tax consisted
mainly of land. The chief source of wealth
upon which this tax was then intended to
operate in the country from which we have
dawn this example was the landed wealth
OF the community. In this country tha'
source OF taxation and that means OF raising
revenue are prohibited, when attempted Il
be enforced upon the principle OF the pro
posed law, by the written Constitution un
der which we are supposed to live. In the
ninth section of the first article OF the Con
sttution it is provided that
'No capation or other direct tax shall be laid unles
in proportion to the census or cuumeiaton heemteio
directed % be taken.'
And in the eighth section OF the same ar
iicle, that
IAN duties, imposts, and excuses shall he uniform
throughout the United States"
It is plain, therefore that the direct taxes
to be constitutional, must be in proportion
TO population, IN the ratio of representation
which is based upon population.
In the category OF direct taxes is tax ol
land. Whatever may be the question abou
other heads of taxation, there can be nc
doubt that tax upon land is "a dircct' tal
as much as a tax upon the head of the citl
zen. A general tax on the rents of Ian,
would be, in effect, and by parity with tha
reasoning always adopted heretofore in Judi
Cial tribunals, tax upon the land itself, jus
as much as devise or grant in gross q
the rents Of land would be held 10 be a gran
or devise OF the land itself. So tor, then
as this tax can be considered a tax upon th
rents of land it is a direct tax, aud therefor
invalid and prohibited to the legislation q
Congress.
That alone sir, should be sufficient oil
lection to this measure; and yet in discusi
ing this question, that point of its colllslo
with the provisions Of the Constitution {
the United States seems to lave been ganC
ed at most slightly and passed by most easii
by the honorable chairman OF the Commute
oi Finance. That to me is one of the chic
reasons why do not assent to pTopositiO
of this character.
Under the pretence OF being a tax on pr,
pertY, under the operation OF lis exemplin
clauses this tax in { feet becomes a tax upo
labor. Whether Of the lands, or Of the mu
cles, or Of the brain, il is still 10 fact n Ia
upon labor. II is a tax upon the salaries
tie clerks of the Departments, n tax upo
the pensions OF widows, or upon their ann
tiles, upon any fixed income. By the basl
of exemption, which are IN themselves il
equitable, proposed by the present bill, iOu
ffths OF the accumulated wealth OF this c0u
try VIII pass Deyonu tue reach OF tnls YAK
three per cent. In actual effect, as was
think demonstrated by my friend from Obi
[Mr. THURMAN,1 the tax upon the lando
for the property that he holds will be rea
lily transferred by him TO his tenant; and {
recily and easily the income tax upon Il
rich will be paid or repaid TO them by Il
poorer persons to whom their property
let OF from whose labor thelr income
drawn.
Mr.. SHERMAN. 1 should like TO ask n
iliend question. We pay an income 4
on our salaries. We receive $1,000 yes
and pay tax Of 5000, or, under this bill,
S120 How can we charge that over to 4
labOring poor? And so ] might go throul
the whole catalogue.
Mr.. BAYARD. No, siri the Senator h
gone just as far as he can 60, l think, by "
Of Illustration, and he has taken from Il
the one feature which cannot be instant
answered. There the Government can i
pose this tax. II is certain fixed sum to
received, which may be assessed before
reaches our hands.