Evening star. [volume] (Washington, D.C.) 1854-1972, 1895-05-20

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Justice Brown.
cording to representation, in order that the
former system to ratio might be retained.
while the mode of collection was changed.
This 10 forcibly illustrated by letter OF
Mr.. Madison of January %. 1ISo, recently
published. written after the ratification OF
the Constitution. but before the organiza-
ton Of the government and the SUBMISSION
of the proposed amendment to Congress.
which, while opposing the amendment as
calculated to impair the power, only to be
exercised in extraordinary emergencies.
assigns adequate ground for Its rejection
as substantially unnecessary, since, ne says
every state which chooses to collect Its
own quota may always prevent federal
collection by keeping a little beforehand in
It's finances, and making its payment at
once into the federal treasury"
Reasons for Direct Taxation.
The chief justice next discussed the rea-
sons for the constitutional provisions re-
garding direct taxation. The states had
plenary powers of taxation, he said, but
gave up the great sources Of revenue de-
rived from commerce. and retained the
power OF levying taxes and duties covering
anything other than excuses, but in respect
to them the range of taxation was narrow
ed by the power granted to the federal
government over Interstate commerce.
While they granted the power of appor-
tioning direct taxation they secured to the
states the opportunity to pay the amount
apportioned and to recoup from their own
citizens in the most feasible way. The Con-
stituton ordained affirmatively that repre-
sentation and direct taxes should be ap-
portioned among the several states accord
ing to numbers and negatively that no d.
rect tax should be laid otherwise The
founders anticipated that the expenses Of
the federal government would be met chief
lv hIy in1
the power to tax involved the power to
destroy. The opinion continued: ut is
said that a tax on the whole income of
property Is not a direct tax, but a duty.
We do not think so. Direct taxation was
not restricted in one breath and the re-
striction blown to the winds in another"
The Hylton case was again reviewed, and
the opinion given that Madison and Hamil-
ton " hose views have been questioned re-
garded the carriage tax bill as unconstitu-
tier al. The Federalist was then quoted
from to show that Hamilton considered all
internal taxes, except duties and excuses
on articles Of consumption. to be direct
taxes. Hamilton, the opinion says, sup
ported the carriage law. which Madison OPP
pc sed, because he regarded it as an excise.
Justice Chase, 1t is said. thought the car
riage tax was tax on expense, because
on consumable commodity, and express
ly declined to give an opinion as to what
were the direct taxes contemplated by the
Constitution"
The opinion then dismisses the IIylton
case with this comment, What was de-
cided in the Hylton case was that a tax
on carriages was an excise, and therefore
an indirect tax"
Constitutional Prohibition.
The opinion next took up the argument
that a tax on property is not direct tax
within the meaning Of the Constitution,
and on this point says:
1.-THE Constitution prohibits any direct
RI nc
ascertained by the census; and, in the light
OF the circumstances to which we have re-
ferred, Is 1t not an evasion of that prohibit
tion to hold that a general unapportioned
tax imposed upon all property owners as a
body for, or in respect of, their property is
not direct in the meaning of the Constitu-
ton, because confined to the income there
from?
Whatever the speculative views of po-
HGcal economists or revenue reformers
may be, can it be properly held that the
Constitution, taken in its plain and obvious
sense ard with due regard to the circum-
stance; attending the formation of the
government, authorizes general unappor-
toned tax on the products of the farm and
the rents of real estate, although imposed
merely because of ownership and with no
possible means of escape from payment as
belonging to n totally different class from
that which includes the property from
whence the income proceeds?
There car be but one answer unless the
constitutional restriction is to be treated
as utterly illusory and futile, and the OBJ
5ect OF It's trainers defeated We find it
impossible to hold that a fundamental
requisiton, deemed so important as to be
enforced by two provisions, one affirma tive
and one negative, can be refined away by
forced distinctions between that which
gives value to property and the property
itself.
Personal Property.
Nor can we perceive any ground why the
same reasoning does not apply to capital
in personally held fer the purpose of in
come or ordinarily yielding income and to
the income therefrom. All the real estate
of the country, and all it's invested per-
sonal property, are open to the direct ope-
ratCn or the taxing power II an appor-
uonment be made according to the Con-
stituticn. The Constitution does not say
that no direct tax shall be laid by appor-
uonment on any other property than land
on the contrary. 1t forbids all unapportion-
ed direct taxes: and we know Of no war
rant Tor excepting personal property from
the exercise of the power, or any reason
why an apportioned direct tax cannot be
laid and assessed. as Mr.. Gallatin said in
his report when Secretary of the Treasury
IN lSl2, upon the same objects of taxa
ton on which the direct taxes levied un-
DER the authority of the state are laid and
assessed"
Nor are we impressed with the argumen,
that because in the four instances III which
the power of direct taxation has been ex.
erc.sed. Congress did not see fit, for rea.
sons Of expediercy. to levy a tax upon
personality. that this amounts to such a
practical construction of the Constitution
that the power did not exist that we must
regard ourselves bound by 1t. We should
regret to be compelled to hold the powers
OF the general government thus restricted
and certainly cannot accede to the idea
that the Constitution has become weak.
ened by a particular course of inaction I'M
der it.
The stress of the argument Is thrown
however. on the assertion that an income
tax is not a property tax at all; that 1t Is
not real estate tax. or crop tax, or a
bond tax: that 1t is an assessment upon tbs
taxpayer on account of his money-spendine
power as shown by his revenue for the
year prec eding the assessment: that rents
received, crops harvested, interest collect
ed. have lost all connection with theil
origin and, although once not taxabla, have
become transmitted in their new form into
taxable subject-matter: In other words
that income is taxable irrespective Of the
source from whence 1t Is derived.
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