The morning news. [volume] (Savannah, Ga.) 1887-1900, 1895-04-09

stvn intended 10 make the consent OF
/ those who were expected to pay, essential
! 20 the validity Of any tax. They had
Just come out Of a conflict upon the great
| principal OF taxation with representation,
ana they were intended to go together
/ that congress should so impose a tax that
II would fail with even force and effect
upon all Of the constituents of those who
/ voted for IL.
| The states represented in the consu-
/ tuuonal convention, said the chief Jus
| tiee, surrendered their right 10 levy inn
/ posts, eNcises and duties to the general
| government. They looked forward to the
/ time when great states to the west of
/ them would be coming into the union, and
When tney gave up that right, they did
/ so with confidence that the rule of uni
formity would be observed in the laying
I OF taxes by the congress.
The first question to be considered, said
l Chief Justice Fuller, was whether or not
I tax on rents is direct tax within the
meaning of the constitution. 1t had al
ways been held, he said. that a tax on
/ estate, real or personal, was a. direct tax.
but IT might be that the constitution had
/ Inherent meaning, and that il was to be
/ applied to this case. In that view it became
/ necessary 10 inquire what were direct
/ taxes at the time the constitution was
The chief justice then made extensive
| quotations from the history of the de-
Dates IN the convention on the subject Of
/ taxation. The inference from them, he
/ said, was that the general distinction be-
| tween direct and indirect taxation was
| well understood by the members of the
tnat direct tax would be the last resort
| of congress.
| The celebrated case of Hyton VS.. the
| united states, decided March 3, 1916, was
| then referred to at great length, the one
In which 1t was held that a tax on car
| riages was not direct tax The several
| opinions hled by the justices were quoted,
| ana Mr.. Chief Justice Fuller asserted that
IN none Of them was there any expression
| OF opinion as to whether or not anything
except land and capitation taxes was in
4 fNNanmr Co.
/ case at hand. The case, he said, seemed
| 10 turn upon the declaration of Hamil-
ton as TO what constituted direct taxes
| II there had been reference to the de-
! clslons OF the country from which the Uni
ted states. derived its Jurisprudence, It
BTqid BTiisin IN nave iLSor been fatal for in Great
treated as direct taxes.
Inc opinion then proceeded to review
| me ueclslops made by the supreme court
IN IN cases arising under the law of 1861,
Whlch, the chief justice said, counsel had
| contended declared that an income tax
| was not direct tax, and must be re-
saIaed % as controlling the case under re-
| view. Inc principle of Stare Decesius,
ne continued, applied only to such cases
| as are directly in point. No court had
ever held itself bound by any part of a
| decision not necessary to decide the case
| before IT, The duty of any court charged
! with the construction of constitutional
| provisions was not to extend a decision
on a question If an error of principle
| was likely thereby to be perpetuated or
| committed. In the light of these ObserVa-
| tons the opinion considered the decisions
| down to that in the Springer case, and
! concluded that they were all distinguish
able from the one in hand. The Springer
case was no exception to the rule, mas
| much as II did not present the point
raised in this case.
Is tax on rents tax on real estate?
| The court, the opinion continued, was
| unable to see any distinction between
| tax on real estate and a tax on rents
arising from such real estate. What is
/ n VIZ a uClF
| The constitutional requirement was that
| direct taxes should be laid only by appor-
| tionment among the states according to
| population, and this tax was direct
| tax. There was no distinction between
| an annual tax on the value of the land
and tax on the land itself. Constitution
al provisions, il was said, could not be
| thus evaded; it was the substance, and
not the form or shadow, that was TO pre-
| vail in constituting them. Upon this point
there were many decisions and some Of
them were quoted.
What the constitution intended to pre-
vent" said the chief justice, was that no
| tax should be laid on the residents of any
/ state by the representatives, of other
| states" The exercise of the power to
| levy direct taxes was to be restricted to
| extraordinary occasions
| In conclusion, therefore, upon this point,
the chief justice announced that the court
were of the opinion that that part of the
law imposing taxes upon rents obtained
| from real estate was invalid.
Next in order the opinion considered the
| third objection to the law: Ihat Is imposed
| tax upon incomes derived from invest
4 ments in state and municipal bonds, and
| was therefore invalid.
| Chief Justice Fuller reasserted the gen
| eral principle that tax on government
| bonds was held to be a tax on contracts
| and prejudicial to the public interest.
| 1t was, therefore, obvious that such a tax
on the power of states or municipalities
| to make contracts was prejudicial to pub
| lie policy and therefore unconstitutional.
| On the other matters involved in the
| case of Hyde VS.. the Continental Trust
| Company of New York city, and in the
case of John G. Moore VS.. Joseph S. Miller,
| commissioner of Internal revenue. for an
| injunction to restrain him from proceed
| ing to carry out the law, appealed from the
| courts of the District of Columbia, Chief
| Justice Fuller stated that the court was
equally divided. The judgment of the
| lower courts. as far as it related to the
payment of the tax on rents and state
| and municipal bonds, was reversed. In
| the Moore case, the effect of the court g
| action Is to affirm the refusal of an in
| junction against the commissioner of in
justices Field and White read indepen-
| dent dissenting opinions.
Justice Field devoted some time to a
review of the provisions regarding rents.
| established by the income tax law. Many
! of his conclusions were in conformity
with those expressed by the chief justice;
| its lack of uniformity, and dwelt upon it's
| exemptions and the many discrimina-
| tiOnS fOund IneIGlu. the eXemp-
! ton of mutual insurance companies, he
! declared that they were conducted on
| lines Identical with those on which large
| corporations were conducted-for the mu-
! tua1 benefit of stockholders. He inveighed
| against the exemption of saving and build
| ing associations, which were not chari-
| table institutions, but conducted for either
| money making or money-saVing. All
| these exemptions stamped the law as class
| legislation of the most pronounced char
| acter The law violated every right and
| comfy guaranteed under the constitu-
| ton That there should be any doubt on
| the subject surpassed his comprehension
| If the census figures did not convince one
/ of the magnitude and injustice of the ex-
| emptions granted, he did not think con-
| gress could be convinced, though one
| rose from the dead to convince it. The
| law was also invalid, in that it levied a tax
| upon the salaries of the 101 judges of the
| United States, many Of whom received
| small salaries. If the provisions of the
/ constitution could be set aside by the ar
| bitrary act of congress, where he asked
| would this power end? It was but a step
| ping stone to other and greater acts that
| would eventually open the way for a
war between the poor and the rich. Such
| a power assumed by congress and per-
mitted to go unchallepged, would mark
| the hour when the decadenee
| Of the nation would commence
/ nsr