The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1871-07-24
WASHING TON.
The Collection Of the Tax on Divi-
dends and Incomes. a
SOLICITOR BANPIELDs DECISION
Nom Appearance OF Ku Klux
Witnesses.
The San Juan Boundary CUES
ton Again.

Inc San Juan boundary Cues
ton Again.
WASHINGTON, July 20, 1871.
| Tho Tax ON Dividends and Observation-Disclosures
| Banneld's Dccisi0m.
The decision OF Solicitor Ban1ed, OF the Treasury
| Department., which was anticipated in these
dispatches OF Wednesday last, concerning the
liability Of the joint railroad companies OF the state
OF New Jersey to pay tax ut the rate Of two and
half per cent per annum for the last five months
OF the year 1870 op'"interesS on couponsn paid on
bonds or other evidences Of debt, was yesterday
promulgated by the Secretary OF the Treasury, and
having been approved by him, Commissioner
Pleasonton will tomorrow be notified that this
class OF taxes Will be exempt from assessment and
collection. But beyond its reference TO tax on
Interest on coupons" this decision does not
apply. IT was generally supposed that all the cases
coming under the Attorney Generals opinion OF
May IL Lost would be included IN the opinion de.
hvered by Solicitor Banneld. IL appears, however,
that the class Of referred to are limited white
the scope OF the decision OF Attorney General Aker-
man covered all the cases that might possibly arise
under his construction OF the act OF July a. 1870 The
question which called forth the opinion OF the At
torney General was upon the refunding OF dividend
tax on the ground that on the 2st OF January last
Commissioner Pleasonton Issued an order In which
he stated that upon careful consideration OF the
question he was Of the opinion that sections nfteen
and sixteen Of the act Of July IA, 1870
| entitled Gan act TO reduce the internal taxes
| and for other purposes" did not authorize
the cvying and collecting OF q dividend tax upon
dividends declared during the last five months Of
! 1870 He revoked all previous rulings contrary to
this OPINION and directed that where assessments
OF the tax had been made but not passed TO the COL
ector that they be struck from the lists, and that
where they had been received by the collector ne
should assist In preparing claims for abatement OF
refunding according the tax had or had not been
paid. In accordance with this ruling large num-
Der Of claims were prepared and presented to the
Secretary OF the Treasury who at once took excep-
tons to the construction or tho law laid down ia
General Peasontou's order, and referred the mat.
ter to the Attorney General for his opinion. The
questions presented were as follOws:-
First-Is the tax on interest or coupons paid on
bonds or otner evidences Of debt imposed BY the
fifteenth section OF the above mentioned act appli.
cable to interest paid subsequently to August /,
sscondEis the tax on dividends of earnings. in.
comes or gains, imposed BY the same section, appl.
cable 10 dividends declared subsequently, to August
| i. 1870, and prior to January, 1s7ii
Thtrd-should oilcers and employees Of the United
States and Senator'S Representatives and Delcgntes
in Congress- from whose pay or salary tax @ the
rate Of i've per cent per annum has been withheld
to include 10 their income return for 1870 the pay OF
salary received by them during the last nve months
OF 1870. IN which no tax has been withheld f .,
replies In the Affirmative, and this was considered
a test case, reversing as It did the ruling Of the
Commissioner on the 10th OF May last he issued the
following circular to assessors and collectors:--
In accordance with the Instructions Of the Score
Vious decision Of this 6nrea:, Is Hereby revoked,
under the ruling Of the attorney General, as fol-
Erst-rhe tag IN interest on coupons paid On
nonds OF 0.ne' evidences OF debt imposed ny tne
fifteen secl' Of the act OF July IA, 1870 applies
S Ss % paid subsequently to August 1917
~scon%NTnc tax on dividends Of earnings. IN.
SGsS Or % %eDssd ~ iA%S
AaaxSS Tad 1ssS Aaa kFlSr . JsAaas{
qua Senator'S, Representatives ana Hs;sSates IN
dve cent per snnu% Ia: Been wshhe
ttnuousIy since December 81. 1859, should be re-
the pay or salary received by them during the last
I'VE months Of 1870. on which no tax has been with
Collector, I'D assessors viii govern themselves
accord,nSs in Sssessrps nd collecting the tax en-.
braced in the above. mentiSaed gases;
C0ncurring In the opinion Of AtsStuey General
Alderman, and having 30 instructed Genera. Pleas
onton, tho Secretary OF rho Treasury did not con.
slider necessary to Issue any orders the SUBJECT
but the Commissioner proceeded at once to enforce
all claims for relief to the Secretary, Here CON-
menced the present unpleasant relations between
Mr.. Boutwell, and Mr.. Pleasonson. Reference TO the
opinion Of Solicitor Banfeld, who Is the legal ad.
wiser Of the Secretary, Will show that there curt
alusion to The error made BY Mr.. PleasontoD, AMI
this is the first evidence from the secretary's once
OF the present nharoni0us relations between these
on1cials.
But the more important part or the mudde-
viz, the difficulty In collecting the tax on dIv-
dends-rcmains to be settled. AS has been stated
above, the Secretary refused to refund the amount
claimed under Commissioner Pleasonton's decision,
and now IL remains to be whether the error OF
Mr. Pleasonton VIII compel Mr.. Boutwell, not only
to recant, but to finally acquiesce in the original
order OF General Pleason-on, who hopes that upon
the assembling OF Congress his construction OF the
act OF July IL, 1870 will he sustained, and that he
will In this gain victory the Secretary OF the
Treasury.
The San juan Boundary Question.
An examination OF the state Department docu-
ments relative to the San Juan boundary shows that
the Fremont map, now making so much talk In
Canadian papers and some in England, was twice
called to the notice OF the American authorities by
English oficals first by the English Commissioners
appointed to adjust the boundary, and aferward by
Lord Russell through Lord Lyons. In both cases
the that 1t related alone to the country explored
by Fremont, and not 10 any questions OF boundary,
was clearly pointed out. 1t also appears that our
government mas knowledge OF the map printed at
London In ls4s three years after ratification OF
the treaty, by ono OF the best known English
map publishers, tn which all the islands in the
san Juan group were colored TO Indicate that
they belonged the United States. This map Is en-
tifled ssMap or Vanc0uyer's Island and adjacent