The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1895-05-21
INCOME TAX INVALID.
Concluded from First Parca


are. wholly Independent of each other that
which is constitutional may stand while
that which is unconstitutional will be re-
Jected. And, in the case before there is
no question as 10 the validity of this act,
except sections q to 81 inclusive which re-
late to the subject which has been under
discussion, and as TO them We think the
rule laid down by Chief Justice Shaw in
Warren VS.. Charleston, is applicable, that
If the different parts are so mutually con-
nected with and dependent on each other.
TO warrant belieI that the LEGISLATURE
intended them as whole, and that, if all
could not be carried into effect the Legis-
pendently, and some parts unconstitu-
tional, all the provisions which are thus
dependent. conditional or connected, must
fall with them.
"Or. as the point is put by Mr. Justice
Matthews in Poindexter VS. Greenhow. 1t
is undoubtedly true that there may be cases
where parte of statute may be en-
forced constitutional and another may
be declared imperative and void because
unconstitutional. but these cases where
the parts are distinctly separable that
eacn can stand alone, and where the court
Is able TO see and to declare that the in
tention of the Legislature was that the part
pronounced valid should be enforceable even
sne w osher part shoHd fa To- hold
law intended by the Legislature one they
may never have been willing by itselfSto
enact
And again. as stated by the same emf
nent judge, in Sprague VS.. Thompson. where
II was urged that certain illegal exceptions
in a section OF the statute might be disre-
garded. but that the rest could not stand:
The insuperable difficulty with the appli-
the present instance is, that by rejecting
the exceptions intended by the Legislature
of Georgia the, statute is made to enact
what confessedly the Legislature never
meant. 1t confers upon the statute a posi-
tive operation beyond the legislative in
tent. and beyond what any one can say
it would have enacted in view OF the lille
gality OF the exceptions
CONCLUSIONS OF THE COURT
According to the census the true valua-
ton Of real and personal property in the
United States in 1890 was 500 O37, 09l, 1877 OF
which real estate, with improvements there
on. made up $39, 544, "a, 1873. OF course from
the latter must be deducted. in applying
these sections all unproductive property
and all property whose net yield does not
exceed $4,000, but even with such deduc-
tions it is evident that the income from
realty formed a vital part of the scheme
for taxation embodied therein. If that be
stricken out and also the income from
all invested property, bon1s, stocks, in
vestments Of all kinds. ii is obvious that
by far the largest part of the anticipated
revenue would be eliminated and this would
leave the burden of the tax to be borne
by professions. trades, emplOyments or vo-
cations. and in that way was intended
a tax on capital would remain in substance
a tax on occupations and labor. We can
not believe that such was the intention
an act, laying, by apportionment a direct
tax on all real estate and personal prop
erty or the income thereof, might not also
lay excise taxes on business, privileges,
employments and vocationS.
But this is not such an act and the
scheme must be considered as n whole. Be
ing invalid as to the greater part and
falling as the tax would, If any part of
it were held valid. in a direction which
could not have been contemplated except
in connection with the taxation considered
as an entirety we are constrained to con-
clude that sections q TO 81,
inclusive, of the act which be-
President on Aug. 2S 1884, are wholly in
operative and void
The decision concludes follows:
"First-We adhere to the opinion already
announced that taxes on real estate being
undisputably direct taxes, taxes on the
rents income of real estate are equally
.'Second-We are of the opinion that
taxes on personal property on the in
come of personal property are likewise di-
"Third-The tax imposed by sections q
TO 81, inclusive, of the act of 1894, so far
as it falls on the income of real estate
and on personal property being direct
tax within the meaning of the Constitution
and therefore, unconstitutional and void.
because not apportioned according TO rep
resentation, all those sections constituting
one entire scheme of taxation are neces-
."The DEGREES hereinbefore entered in
this court will be vacated. The DEGREES be-
low will be reversed and the cases
manded with instructions TO grant the re-
lief prayed.
referred TO in the conclusions of the court
in the opinions are all the sections of the
act relating TO the income tax so THAT the
entire income tax law is declared void
specifically.
The Chief Justice concluded the reading
of his opinion at 1852 o'clock. its delivery
having CONSUMED fifty minutes.