The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1894-12-23
Suit Brought by New York Bu.fne..
Men Asking an Injunction Against
Commissioners Miller.
ACT DECLARED TO BE UNJUST
on THE GROUND THAT IT DIsCRIM-
MATES AGAINST RICH CITIZENS,
And Also that Ii Taxes Incomes OF
Aliens Who May BE Temporarily
Residing I'm the United states.

WASHINGTON. Dec. 22.-The first steps
have been taken in the District Court "a
test the constitutionality OF the income
tax law To-day, j. Wilson. as counsel for
j. q. Moore, of the New York banking
firm OF Moore & Schley, applied to Judge
Cole, OF the equity branch OF the Supreme
Court of the District OF Columbia for an
order restraining ]. S. Miller Commissioner
of Internal Revenue from assessing and
collecting tax on his income. Because OK
the Importance Of the action. IL is expected
that the court viii fix an early day for the
hearing. This is only one OF a number OF
legal attacks that will soon be made here
on the income tax, and each suit will be
based on different grounds. The moving
parties are New York business men. 1t is
the intention OF a number OF these indi-
viduals to refuse to pay the tax and ap-
peal to the courts in each case. Mr.. Moore's
complaint in detail. sets out his case under
six heads and his prayers under four. He
represents:
first-That he is a citizen OF the United
States and OF the State OF New YORK. re-
siding and doing business in the city OF
right
Second-That the defendant, Joseph S.
Miller, is also citizen OF the United
States. occupying and discharging the dn-
ties OF the Office of Commissioner OF In
ternai Revenue, and as such is sued.
noIaar Inironinat tne complainant Is axshare-
listing and doing business in The United
States under and by virtue OF their
said corporations have net earnings from
which they pay dividends TO the complain
ant and also TO the other stockholders.
from which net earnings there will be paid
10 the complainant, during 1894. divers
sums OF money as such dividends.
dition to these dividends the complainsnt
has an income derived from the gains and
profits OF his BUSINESS and embraced within
entitled An act TO reduce taxation. to
provide revenue for the government and for
other purposes" (the present tariff act,
which became a law without the approval
OF the President, largely in excess OF the
sum OF $1,000 per annum, upon which in
come, including the dividends before men,
toned, the defendant Commissioner OF In
ternal Revenue has threatened 10, and un-
less restrained, VIII proceed to assess the
sum of per cent OF the amount OF your
complainant's income in excess OF $4,000 per
annum.
Fifth-The complainant further shows by
reference TO Section %. or said act of Con-
gress. that these corporations are also
CURED to pay tax OF per cent on their ,esi
by Sections n and IS of sale act the com
the said moneys so paid TO him as as c diyi-
dends thereby wronefully- duplicating the
tax of the complainant and by references
to Section n of the act the complainant
shows to the court that said taxation is
unjust and unequal in that IL discrfminates
against the complainant Tor the purposes
OF taxation between persons who are cit
zens OF the United States and wholly ex-
empts emp such persons from i taxation as . afore
up to and not in excess of the sum OF
Hooe per annum. and thereby the COM
plainant and all others. In the
equal PROTECTION of the law. Further, by
reference to Sections q and IS, it is shown
to the court that there Is associated with
the taxation of citizens of the United
States, and subject 10 the proposed taxa
alton and not separable therefrom. the pro-
vision that the persons who are aliens. but
who reside in the United States whether
permanently or only temporarily shall like
%las tsx such income is IS derived @
wholly from rents, interests, dividends, sal
aries or from any profession, trade en-
than in the United States, thus urdertak-
ing, unlawfully and without authority. TO
tax the incomes Of citizens OF foreign coun-
tries alien 10 the United States who may
have within the United States a temporary
residence for temporary purposes. although
such incomes are derived wholly from
sources not within the jurisdiction OF the
United States No exemption rs made in
the act from taxation OF the incomes of cor
porations within the United States. OF
ried on for profit, are created, owned and
operated by the several States as govern
ment instruments in the promotion OF the
police and other public functions which cor
porations are not subject to taxation by the
| United States; Ii Is also shown that assess
the complainant and others that had been
earned and received prior to the time the
| provisions Of the act took effect, and that
the said taxes are not within the consfitu-
tional Jurisdiction of Congress TO impose
Sixth-It is also alleged that the commits
sioner is taking steps TO make assess
~ a. inf raraIo
| and collect not only for the first years IN
come subjected TO taxation, but also by the
requirements OF the act for incomes here
after TO arise yearly and continuously until
1900. The commissioner and his subordinates
are now taking necessary steps 20 make the
assessments and collections OF the income
taxes.
1t is averred that Sc the taxes are col
| lected. although unlawful and unjust, the
complainant would have no remedy 10 re-
cover from the United States or only by
| long litigation, making the remedy useless
| The act, IL is charged. is invalid In the pro-
| visions so imposing the income tax and In
| such provisions is unconstitutional, inoper-
ative and void; If the taxes are collected
he would be without adequate legal remedy
| for redress of the illegal collections. and in
| view OF the continuousness OF the taxes, as
| provided, until Jan. i. 1900. unless restrained
| by the court, the complainant 10 the IL
| legal assessments will be subjected 10 har-
| rassment. expense and annoyance OF a null
| titude Of suits resorted 20 during the period
| in enforcing the assessments on this
| ground, IT Ia prayed:
First-That a subpoena issue to require
the Commissioner OF Internal Revenue to
| appear and answer this BILL but not under
oath, such answer being expressly waived.
| Second-That during pendency OF the
| cause the commissioner and persons acting
| under his authority be restrained and en-
1 Joined from doing any act looking TO or con-
templating the collection OF income tax as
| provided by the act.
! Third-That on final hearing OF shis cause
the defendant and all persons acting under
| him and by his authority may be perpetu-
ally restrained and enjoined from doing any
act or acts so hooking TO or contemplating
| the collection OF such tSx or any part there
! of as provided for in that act Of Congress.
Fourth-And for all other further relief
| that may be just and equitable In the prem
ises.
The case viii probably be brought up for
trial in the Equity Court. before either
| Judge Cox or Judge Hagner. early i'm July.
| The judicial regulations OF the district pre-
| vent the case from being appealed 70 the
District Supreme Court. and in event OF an
adverse decision I'm the Court OF Equity the
petitioner will take the case direct TO the
| District Court OF Appeals. and FROM there q
4 .l<.,rf.f - ITr.44.. a