The state republican. (Jefferson City, Mo.) 1871-1896, 1895-04-18
INCOME TAX DECISION.

Chief Justice Fuller himself read
the decision Of the United States
supreme court in the income tax
cases. He began by stating the
exceptions to the law as made by
counsel for the appellant as follows:
/. That the act imposes direct tax IN
respect OF the real estate, rents, issues
and profits as well as OF the income and
profits Of personal property aud not being
apportioned 10 in violation Of section Q,
article l, OF the constitution.
Q. That the law, II not imposing
direct tax, Is nevertheless unconstitu-
tional in that its provisions are not uni
form throughout the United States and
do not operate with the same force and
effect upon the subject Of the tax, wher-
ever found, or in that it provides exemp-
tions in favor OF individuals and co part
uerships while denying all exemptions
to corporations having similar income
derived from like property and values,
and provides for other exemptions and
inequalities in violation OF section OF
artlcle L OF tne constitution.
3. That the act provides no exemption
of the tax upon incomes derived from
the stocks and bonds OF states Of the
United States and counties and munich
palities therein, which stocks and bonds
are not proper subjects Tor the taxing
power OF congress. The income from
these securities in the United States
amounts to over 85 million dollars per
annum, on which the total annual in
come tax would be 81 ,3OO,0 900.
The chief justice then took up the
constitutional points involved, dwell
ling upon the fact that the constitu-
tion required the apportionment OF
direct taxes and uniformity in excises
and imports. He also dwelt upon
the question of representation and
taxation, which was, he said, fore
most one when the constitution was
adopted. The question of the tax
on rents was next discussed, and in
so doing the issue of direct taxes as
considered at the time of the franz
ing Of the constitution was consid-
cred. The trainers of the constitu-
tion were, he said, we'll versed in the
government of the colonies and
European countries and we're we'll
versed in the literature of the
period, including works on political
economy, and we'll calculated to pass
intelligently on this question. He
quoted various supreme court decis-
ions and sought to show that, while
the income tax question had been
before the court, the question had
only been considered as applying to
che point at issue in the particular
cases.
Coming down to the present tariff
act the chief justice said that the
law was passed in time Of profound
peace and it was to be taken as evil
dence that the congress had sought
in this matter to form a precedent
and establish a departure from
established lines, and it therefore
became important to inquire into the
circumstances with some attention to
detail. For the purpose of COM
parison, he went back to the enact
ment Of an income tax during the
civil war. He quoted from the
decision in the Springer case, giving
a history of the case ard devoting
much attention to 1t, as he said it
was upon this case that the defense
had apparently relied; this more
generally than upon any precedent.
It was, the chief justice went on,
conceded in all the cases from Hill
ton to Springer that taxes on land
= were direct taxes, while in some ol
them it was determined that taxes
on rents derived from lands were
indirect taxes. Was there, he
asked, any distinction between tax
the land ard on the income derived
from the lands? What, in Other
words, was the land but the profit
on 1t? The name of the tax is un
important, and the court has beer
unable to see any distinction. He
closed by saying: "1'he court car
fnd no difference between a tax OF
land itself and a tax on rents ol
income derived from land. The
court therefore II of the opinion
that a tax on rents or landed in
vestments Is direct taxation ant
unconstitutional"
The court next decided that tn,
tax was unconstitutional SO far as l
related to incomes from state
county or municipal bonds. 1t wa
next ruled tnat the fact that the Law
was pronounced unconstitutional II
these two particulars did not invali
date the law as a whole. 1t wa
announced that in this latter conciu
sion the court was equally divided
and therefore rendered no opinion
The lower court having ruled 4
favor Of the law by divided court
the law would stand except as +
rents and state, county and munici
pal bonds, and on these two point
it was directed that the judgmer
below be reversed.
The syllabus of the COURTS opinio
Is as follows:
In Re Charles Pollock vs. the Farme
Loan and Trust Company ct al 1t ia q
tablished;
l. That, by the constitution, feder