The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-12-18
THE TAXATION OF INHERITANCEs

While some States like New York and
California are laying taxes on inheritance
for the benefit of the State treasures, and
Illinois is accomplishing the same end by
charging enormous fees for proceedings in
the Probate courts, Senator Hill of New
York has proposed bill which would tax
inheritances for the benefit of tbs General
Government. The bill exempts estates
worth less than $1,000. 1t provides that
the tax shall not reduce the Inheritance
coming to widow below what is neces-
sary for her support And it declares that
real estate passing to direct heirs OF the
deceased shall not be subject TO tax.
The bill is open TO two objections, and
both of them are fatal. Under our sys-
TEN the proceeds of property taxation be-
long TO the States. The nation al Govern
ment is expected to draw its revenue from
customs, excise, and in cases of necessity
from stamps and incomes. Minor political
subdivisions, such as States, counties and
nun clpalities. derive their income from
taxes upon property licenses and other
small sources Of revenue. It is upon prop
erty taxes that these organizations rely
mainly for means of support. All that
property will bear in the way of taxation
belongs to he States. counties and munich
palties; and that is true both of property
In the hands of owners and of property in
transit between one owner and another.
The General Government has no more
right to tax inheritances than it would
have to lay hands on the proceeds of hack
licenses.
Again, Senator HIPS bill exempts from
faYQ tim raol 70 Got
son by inheritance. Thar is the very kind
of property that an inheritance tax should
strike. The great bulk Of the property
left by rich deeedents is invested in real
estate. There are exceptions to the rule.
as In the case of Gould and the Wander
bllt', whose estates consisted mainly of
stocks and bonds. But such cases are
rare. Most of our rich men. while owning
stocks and bonds, leave the bulk of their
belongings invested in real property.
urban or rural. An inheritance tax which
exempted this form of wealth would fail
In lis object. and would be of little value.
The equity of an inheritance tax depends
upon the proposition that an heir has no
natural right to his inheritance; that the
right is an artificial right created By law,
There is moment of time when the prop
erty OF deceuent has no owner. II can
not belong to the deceased, for he is dead
and dead man can own nothing; nor can
1t belong to his son for his claims to il only
begin to exist when he has complied with
certain forms of Law. He cannot even
assert an equitable right to possessions
which he did not create Or acquire by any
effort of his own. Finding the property
thus derelict the State may step in and
deal with il according to the best interests
of society. Certainly, within reasonable
bounds, 1t may rightfully tax it.
But the tax must be equal and so framed
that 1t shall neither allow certain class
of rich heirs to escape nor impoversh the
widow and the orphan. Where an esta g
is so small that it hardly yields an income
sufficient TO maintain family decentlv it
is right and proper that the State should
not exercise its power OF taxation. Sena-
tor HIPS limit of $4,000 might be increased
TO $4,000 with out error. But it is mani
testify absurd to tax an estate which con-
slsts OF stocks and bonds so much per cent
and to allow another estate TO escape be-
cause 1t consists of rows of houses and
lots. All must pay alike, with due lin
ltations dictated by humanity.