The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-03-12
Assistant Attorney General
Whitney Says the Levy Is
Uniform.
EDMUNDs THROWS HOT SHOT.
Tells How the Blunders Of Congress
May Lead Up to Fearful
Revolution.

tOrney-GeneraI w hltney resumed MS argu-
ment in sustaining the income tax law be-
fore the Supreme Court to-day. Attorney
General Olney, ex-senator Edmunds and
many other distinguished counsel in the
case occupied seats at the desk reserved for
attorneys. The courtroom was crowded.
Mr.. McMillin, Mr.. Springer and several
other members of Congress who had taken
part in the enactment of the income tax
were among those present. Mr.. Whitney
addressed himself to the question of uni
formity in taxation, in answer to the
charges that the income tax violated the
principle of uniformity. He contended
that the limit of $4,000 fixed by the law was
not class legislation.
If a subsequent Congress had sought to
amend the law by including that those not
previously exempted by the $4,000 limit,
this amendment would no doubt be class
legislation, as it would apply to a distinct
class. Mr.. Whitney reviewed prior de-
cisions in insurance and other cases, show
ing that the Interpretation of this court on
class legislation would not apply to the
income tax.
Concerning the exemptions allowed to
certain corporations the Assistant Attor-
lS -0tllcIdl Sdlli IL Was IuOSG SURPRISING
that this was set up as a ground for in
validating the tax. He read from numer-
Gus Federal tax laws showing repeated
exemptions in the cases of art societies
and many other corporations. The court
had sustained tax emption TO manufac-
turing corporations in the District of Co
lumbia. Building and loan associations
and savings companies were frequently
exempted by law, as they were made up of
poor people, to whom the law gave special
consideration. During the war the law
makers even exempted the mutual insur-
ance companies from the operations of the
general tax law.
Mr.. Whitney said that the Supreme
Court had already overruled the contention
that the taxation of land values and
rentals, as made by the income tax was in
valid. The State taxes were against the
land and not against the individual, but
the income tax was not against the land
but merely against the total income of the
individual AS this income came in part
from land it was merely an incident.
The income tax is in no sense land tax
1t is not on the gross income from land
and other sources, but on net income.
Whitney took up the claim that the Fed
eral Government cannot tax municipal and
local securities held by individuals, as for
instance, bonds issued by New York City.
He said it had been decided in the case of
Bonaparte against the State of Maryland
that State could tax bonds of the city or
State of New York. If the State could
exercise this power, why could not the
Federal Government do the same?
Q. IL, 90
followed by Edmunds, counsel against the
tax. He spoke quietly and in converse
tional tone, much as he did when a lead
ing figure of the Senate. He stated the
contention of his client against the inva-
sion of his rights and an inspection of his
private books and papers. If there was
constitutional provision protecting the in
diyidual it was the rock upon which the
contention against this tax was based.
Edmunds read from the constitution as to
the protection of private rights. These
provisions, he said, were trite, and yet it
seemed necessary in these days with such
legislation before us to recall these consti-
tutional bulwarks against an invasion of
private rights. In a question of this
gravity he would feel disposed to ask the
court not only to pursue precedents and
follow them in this matter, but to go back
and rule upon the entire subject, so vital to
sustaining private rights.
The worst tyranny of history was that
which came in the guise of relief. He
first spoke of the action of Congress in en-
deavoring to take away from the courts
the right to appeal for protection as was
the case in the income tax law. He did
l. ,,,l- lo I'D
should be no longer an appeal to the courts
from the acts of Congress. 1t was beyond
the function of Congress to pass an act
that would strip the courts of their rights,
and this was just as true as to the rights
OF the citizen as to those of the courts
Speaking of the income tax law he re-
ferred to the provision that the taxpayer
was required to make his returns to Dep
uty Collectors. He said that the deputy
was not recognized as legitimate officer
under the constitution. "I do not, how
ever" he said, ''mean to dwell on that, but
merely refer to it in passing as one of the
points of the vice which bloomed in the gar
den of the last Congress-" He criticized
many other features of the law providing
for the collection of the taxes, pointing out
that it left no room for resort or appeal to
the courts, but left to the revenue officers
the adjustment, who, he said, were not
only the final judges but the inquisitors as
we'll.
cit is true he said, chat these returns
are to be regarded as confidential, but how
are we to know they will always be treated
so? 1t is not possible to know how they
may be treated. Is it not possible they
may be handled, for instance, like the con-
fidences of the United States Senator"
Mr.. Edmunds then reviewed the case
heretofore decided, which has been re-
ferred to in the previous argument, and
discussed the points involved at length.
He was referring to the Hilton case, in
volving the tax on carriages, when Chief
Justice Fuller called his attention to the
fact that Mr.. Hilton had an unusual num-
Der of carriages, 125 as he remembered.
Unusual in numbers, yes,' Mr.. Ed
munds asserted, "but he possessed them as
many persons possess virtue and grace
He asked the court to overrule it's former
decision in the income tax as given in the
Springer case. ''Let u.s." he said, "come
hack to the true rule of the constitution