Evening star. [volume] (Washington, D.C.) 1854-1972, 1895-04-08
$65 900. 900 per annum, on which the total
annual income tax would be S1,3OO,OOO.
The Constitutional POfuts.

The Constitutional Points.
He then took up the constitutional points
involved. dwelling upon the fact that the
Constitution required the apportionment of
direct taxes and uniformity in excuses and
imports. He also dwelt upon the question
of representation and taxation, which was,
he said. foremost one when the Consti-
tuition was adopted. He then took up the
question OF the tax on rents, ana IN so 90
ing discussed at considerable length the
question of direct taxes as considered at
the time of the framing of the Constitu-
ton.
The trainers of the Constitution were. he
said, well versed in the forms of govern
ment of the colonies and of the European
countries, in the literature of the period,
including works on political economy, and
well calculated to pass intelligently on
this question. He quoted various Supreme
Court decisions, and sought to show that
while the question had been before the
court 1t had only been considered as APP
plying to the question at issue In the par
ticular cases.
Passed I'm n Time of Peace.
Coming down to the present tariff act, he
said that the law was passed in time
of profound peace and it was to be taken
as evidence that Congress had sought in
this matter to form precedent and de-
parture from established lines, and it there
fore became important to inquire into the
circumstances, with some attention to de-
tail, and for the purpose of comparison
went back to the enactment OF an income
tax during the civil war. He quoted from
the decision in the Springer case, giving
history of the case and devoting much
attention to 1t, as. he said. 1t was upon
this case that the defense had apparently
relied more generally than upon any other
precedent. 1t Is, he said. conceded In all
the cases, from Hylton to Springer. that
taxes on land are direct taxes. while IN
IS tI,a,,, tey lat inc a a v
rents derived from land are indirect taxes.
Was there, he asked. any distinction be-
tween a tax on the land or the income de-
rived from the land?
What, in ether words, was the land but
the profit en- It? The name Of the tax Is
unimportant, and the court had been I'M
able to see any distinction. He closed this
part of the opinion by saying that the
court had reached the conclusion that the
tax on rents was involved.
State and Municipal Bonds Exempt.
The chief justice then took up the ques-
tion Of the taxation of municipal and state
bonds, and the decision was also adverse
to this part of the bill, as repugnant to the
Constitution.
The court is of opinion that the act Is
invalid so far as it attempts 70 levy tax
upon the income derived from municipal
bonds.
As a municipal corporation is the repre-
sentative of the state, and one OF the IN
strumentalities of the state government.
the property and revenues of municipal
CORPORATIONS are not the subjects OF federal
taxation, nor Is the income derived from
state, county and municipal securities,
since taxation on the interest therefrom
operates on the power to borrow before II
is exercised. and has a sensible influence
on the contract, and therefore, such tax
is a tax the power of the states and
their instrumentalities to borrow money,
and consequently repugnant to the Con-
stitution.
Equally Divided.
Upon each of the other questions argued
at the bar. to wit: First, whether the void
provisions IS to rents and incomes from
real estate invalidates the whole act; Sec
end, whether, as to the income from per-
sonaI property as such, the act is uncon-
stitutional laying direct taxes; third.
whether any part of the tax. il not con-
sidered as a direct tax. is invalid for want
of uniformity on either of the grounds sug-
sested. the justices who heard the argu-
ment are equally divided, and, therefore,
no opinion Is expressed.
The result Is that the decree of the cir
cult court Is reversed. and the cause re-
handed, with directions to enter decree
in favor of complainant In respect only of
the voluntary payment of the tax on the
tents and income Of its real estate, and
that which it holds IN trust, and on the
income from the municipal bonds owned or
SO held by It,.
The announcement of the foregoing con-
illusions was preceded by a review of many
opinions of the Supreme Court from the
time of Chief Justice Marshal down to the
celebrated Springer case. brought by ex-
Representative Springer of Illinois. and by
an exhaustive review of the nature of
direct and indirect taxation. in the course
of which the chief justice reviewed the
debate as leading up to the framing of the
federal Constitution. In conclusion, the
chief justice stated that his opinion upon
a cd hn tyvn ~ hnV
cases.
The delivery of the opinion consumed
just one hour. Chief Justice Fuller began
at 1906 and concluded at 1:O5.
Justice Fields Dissent.
He was followed by Justice Field. who
read the first dissenting opinion. speaking
in low tone that contrasted noticeably
with the clear delivery of the chief justice.
Justice Field declared his opinion that
the whole law of 1894 Is null and void.
Justice Field laid stress upon the fact
that the law does not exempt judges of
United States courts from the payment of
the tax. 1t was not right he said that
the Supreme Court should remain silent
and make no protest when many United
States judges drawing small salaries would
be affected because of the law, and he
called attention to the letter once writ
ten by Chief Justice Chase to the tlEasury
officials protesting against the deduction of
an income tax from the salaries of United
states Judges.
Justice Fields opinion was largely de-
voted to a review of the provision regard
ing rents. and was a vigorous denunciat ton
of ths principle sought to be established by
the income tax law, his conclusions being In
con nifty with those announced by the
chief Justice He also attacked the law on
account of lack of uniformity, and dwelt
upon its exemptions and Determinations
which was, he said, class legislation. He
devoted especial attention to the exemptions
of saving banks. mutual insurance compa-
MES and building and loan associations.
He quoted census figures to show the ex-
tent of the operations of these companies
and said that if these facts were not con-
vincing. Congress could not be convinced,
though one rise from the dead"
He took issue with those who contended
that there could be no legitimate limitation
upon the power Of Congress to impose
taxes.
Justice Whites Dissent.
When Justice Field concluded Justice
White also delivered a dissenting. opinion.
1t seemed. he said. that long dissents were
a custom more honored in the breach than
in the observance He thought the court
In its decision today had overthrown long
line of decisions and the uniform practice
since the foundation of the government
The bill was, he said. prayer for in