St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1894-06-27
STATE BONDS TO Be TAXED
kLS0 MUNICIPAL SECURITIES AND
PERSONAL PROPERTY AHERf7AHcEs.
HILL MAKES a STIFF FIGHT.

HILL MAKES A STIFF FIGHT.
He Argues Against the Constitu-
tionality of Such a TaX-Mitch- |
ell and Others Agree With the !
New Yorker-Evidence In Rc-
buttal Before Revenue Coilec-
tions May BE Made.
WASHINGTON, June 26.-With the
Thermometer standing at SO degrees in
the senate chamber today, the senate
entered upon the thirteenth week OF
the tariff debate. At the opening OF the
session Mr.. Alien made another inef-
fectual attempt TO secure consideration
Of his resolution directing the secretary
of the treasury to inform the senate OF
the total number of persons engaged in
protected industries whose wages
might be affected by tariff legislation.
MIR. Gallinger objected, and Mr.. Morrill,
moved to refer it to the finance COM
mittee. Mr.. Allen gave notice that as
long as the resolution remained Enacted
upon he would object to all legislation
by unanimous consent. MIR. Morrill's
motion was defeated by a vote OF 16
to q.
Then the sep ate resumed the. consid-
Grafton of the income provisions of the
tariff bill. -
Mr.. Hill withdrew the amendment Of
fered Saturday to strike nj the pro-
vision exempting the interest on United
States bonds from the operation Of the
tax. His object in Offering the amend
ment. Mr.. Hill said, was to call the at
tentlon of the country to the fact that
s635. 00O, GOO of property in
GOVERNMENT BONDS
were necessarily exempt from the opera
ton of the income tax under the law.
Although the ostensible purpose OF the
income tax was to reach wealth and
eQualize the taxation, there was ain
enormous investment OF capital which
the income tax could not reach. Mr..
Hill then moved 10 except state. county
and municipal bends. He argued that
the taxation of state bonds by The fed
eral government would be a direct at
tack upon the administration of the
states. If the federal government had
the right to diminish the value OF state
bonds and securities. 1t had the right to
destroy them. Aside from the question
of the exercise of a doubtful power. in
justice to the states which senators rep
resented on this floor, and upon which
this tax bore harshly, Mr.. Hill thought
the states should have the right to issue
bonds without being subject to federal
taxation.
Mr.. Vest held that state or municipal
bonds could not properly be exempted
from taxation. MI. Chandler expressed
the hope that upon reflection the Demo-
cratic majority would not place states
and municipalities, when they were
forced to borrow money. IN a worse po-
sltion than the United States. The
United States could now borrow money
cheaper than any country, state, cor
porallon or individual. But because it
occupied this
coIGN OF VANTAGE,
the government should not bear the
credit Of states and cities by raiding
their securities.
Mr.. Mitchell, of Oregon. agreed with
Mr.. Hill that taxation of state aud
county bonds was of doubtful constitu-
tionality. Mr.. Sherman also agreed
with Mr.. Hiips position. The iilore he
thought Of 1t h more he became salts.
fed that The Unites States should moi.
Discussion on the c0hstitutionality Of a
national tax on state ana municipal
bonds continued for sumo time, and
then a vote was taken on MI. Hills.
M ndm @ Uac lnst-CE fn an
Messrs. Gray. Hill and Pugh. Demo-
Gratis. voted for the amendment: Mr..
Pettigrew. Republican, and the Popu-
lists against it. Otherwise it was a
strict party vote, the Republicans for
and the Democrats against.
MIR HILL THEN
modified his amendment So as to cOnfine
the exemption 10 state bonds.
A long constitutional discussion of the
powers and Limitation Of federal taxa
ton followed, in which MesSrs. Hoar,
Morgan, Pugh, Lindsay. Gallery and
Gray participated.
Mr.. HIPS amendment to exempt in
terest from state bonds was also lost,
81 to 80.
Mr.. Hill then moved to strike out the
provision fOr a tax OIL personal property
acquired Ivy gift or inheritance. Lost,
26 10 81.
The proviso offered by Mr.. Vest last
week as an amendment to section IS
that ''in computing the income of any
person, corporations. company or assU-
citation, there shall not be included the
amount received from any corporations,
etc.. as interest or dividends upon the
bonds or stock OF such corporations, etc.
If the tax of 2per cent has been paid
upOn its net profits by said corporation,
as required by this act" was agreed to.
An amendment of Mr.. Aliens, to
PERMIT EVIDENCE
in rebuttal before collectors of internal
revenue as to the amount of incomes.
was agreed to. as was The Vest amend
ment excluding in the calculation Of
the incomes of banks, banking institu-
tons, trust companies. life, fire and
other insurance companies, railroad.
canal, telephone, telegraph and other
companies, actual operating and bust.
ness expenses, losses and interest on
bouded and other Indebtedness.
A committee amendment %as adopted
providing tina: the tax shall not apply
ITO states, counties. nor municipalities. |
nor to corporations. companies. or asso-
Citations organized and conducted solely
for charitable, religious. or educational
purposes, including fraternal bene-
ficiary societies. orders or associations.
operating upon the lodge system,
and providing for the pay.
ment of life, sick, accident and
other benefits of the members of
such societies, orders and assoc iatons
and dependents of such members; nor
to the stocks. shares, funds or securities
held by any fiduciary or trustee for
charitable. religious or educational pur-
pose: nor to the loans MBde by building
and loan associations to their share
holders for the purpose of enabling
them to provide for themselves homes:
nor to such savings banks, savings in
situations or societies as shall. first. have
no stockholders or members except de-
positors, and no capital except deposits: