The herald., 1895-05-21

uEOn bi-e IdA pd,NsT On aCtOuuI Oh HIS
money spending power shown by his
revenue for the year preceding the AS
sessment that rersssS- received. crops har-
vested. interest cobscted, have lost all con-
nection with their origin, although once
not taxable subject matter. In other
words that the income is taxable ire
spective OF the so urce whence it is de-
rived"
The chief JUSTICE said that since the
courts had held unanimously that re-
ceipts frolh municipal bonds should not
be taxed because the bonds were nstru-
ments of states, the same rule applied to
revenue from other sources not subject
TO tax and lack oi power to levy any but
apportioned tax on real and personal
property equally exists as to revenue
therefrom. The court does not under
stand that ths income tax has ever been
regarded in Knglsnd as any other than
direct tax
After this review OF cases and consider
aation of arguments of counsel. the court,
as it approach ed its conclusions, made the
following general argument:
III it were a fact there had been no in
come tax law sEpch AS this ut the time the
constitution was framed and adopted it
would not be of controlling Importance.
A direct tax caalnot be taken out of the
constitutional lrlle because the particular
tax did not exist at the time the rule was
prescribed. As Chief Justice Marshall said
in the Dartmouth college case. it is not
enough to say that this particular case
was not in the mind of the convention
when the article vas frame ed, nor OF the
American people when it was adopted.
1t is necessary 10 go further and to say
that had this particular case been sug-
gested, the language would have been so
varied as to eN ciude It, for it would have
been made a special exception The case
being within tn words of the rule, must
be within its ,operation likewise. unless
there be something the literal con-
struction so obviously absurd or mis-
chevious or re epungant to the general
spirit of the insl ;rument as to Justify those
who eXpoJnd the constitution In making
it an except on.
"The tax being direct and therefore to
be laid by apport onment, is there any
real difficulty in doing so? Cannot con-
gress, il the necessity exists of raising
thirty forty. or any other number of
million dollars for the support of the
government in addition to the revenue
from duties, i'm posts and excises, appor-
tion the quota of each state upon the
basis of census and thus advise it OF the
payment which must be made, and pro-
cecd to assess that amount on all the real
or personal property or the income OF
persons in the state and collect the same
if the state do not, in the meantime.
assume and pay its quota and collect the
amount according, to its own system and
in its own wayI Inconveniences might
possibly attend th e levy of any income
tax, but that it is objectionable is hardly
Qen1eQ, altnOuSn III is asserbeu tndI III
would operate so unequally as to be un-
desirable.
TT is apparent that the suggestion
that the pliant.e with the fupdamen-
tai law would lead TO the abandonment of
that method of ta,Xaton altogether be-
cause of inequalities alleged to necessar-
lily accompany Its pursuit could not be
allowed 10 influence the conclusion, but
the suggestion not hnnaturaly invites at
tention to the contention of appellants
counsel that the went of uniformity and
equality in this act. is such as to invali-
date it. And ii cures drawn from the CEN
sus are given, showing that enormous AS
sets of actual insurance companies. of
building assocatio as, of mutual savings
banks, large productive property of &C.
cleslasti1al organic atiors are exempted
and that the exemptions reach so many
hundred millions that the rate OF taxa
tion would perhaps have been reduced
one half if they had not been made.
''We are not dealing with the act from
thai point of view but assuming the
data to be substantially reliable if the
sum desired to be raised had been appor-
toned, it may be doubted whether any
E. state which paid its quota and collected
the amount by Its own. methods would
or could under its own constitution have
allowed a large part Of the property al
luded to. to escape taxation. If SO, better
measure of equality would have been at
tanned than would be otherwise BILE,
since according to the arguments for the
government. the rule of equality is not
prescribed by the constitution as to fed
eral taxation and the observance of such
rule as inherent in all Just taxation is
purely matter of Legislative discretion.
Elaborate argume is made as to the
efficiency and merits of the income tax in
general, as on the one hand equal and
Just and or the other elastic, and certain
that it is not open to abuse by such dicta-
tions and exemptions a mig hit make tax
alton under it so wanting in uniformity
and equity as in substance to amount to
deprivation of property without due pro-
cess OF law-not that it is not open to
fraud and evasion and inqustorial in
its methods, but because it is pre-emi-
nently tax upon the rich and enables
the burden of taxes of consumption and
OF duties on imports to be sensibly
diminished.
''And tits said that the United States
MS the representative OF an indivisible
nationality, as political sovereign equal
in authority to any other on the face OF
the globe, adequate to all emergencies
foreign or domestic, and having at its
command for offense and defense and for
all governmental purposes all the resour-
ces of the nations. would be but q
manned and crippled creation after all,
unless it possesses the power to lay tax
on the income of real and personal prop
erty throughout the United Stats without
apportionment.
The power to tax the real and per-
sonal property and the income from both
through apportionment is conceded; that
such tax is direct tax in the meaning
of the constitution has not been denied,
and in our judgment cannot be successful
ly denied and we are thLs invited to hesi-
tate in the enforcement of the mandate
OF the constitution which prohibits con-
gress from laying direct tax on the
property of citizen without regard to
state lines and in such 4 manner that the
states cannot intervene bY payment in
regulation OF their own resources, lest a
government Of delegated power should
he found to be not less powerful but less
absolute than the imagination OF adyo-
cate had supposed
I'VE aresnot here concerned with the
question whether an income tax be or be
not desirable, nor whether such n tax
should enable the government to dimin-
ish tax on consumption and duties on i'm
potts and TO enter upon what may be
believed to be a reform of its fiscal and
commercial systems. Questions of that
character belong to the controversies of
political parties and cannot be settled by
judicial decision. In such cases our prov
ince is to determine whether this income
tax on the revenue from the property
does or does not belong to the class of d-
rect taxes, so if il does it is being amor.