The times. [volume] (Richmond, Va.) 1890-1903, 1895-04-09
VOL 9-NEW SERIES NO 80.

es,atc and that not being laid accord
ing "a apportionment, II was invaiid.
3 yhat It was not uniform, ana
violation of the constitutional require
ment that such taxes shall be laid WIN
uniformity. Under this head came the
exceptions In favor OF those persons VINO
were not I'm possession OF an income OF
5000; of mutual insurance companies,
savings banks and partnerships. all or
eanized for and doing the same business
as that of corporations authorized by the
States These exceptions. II was heiu'
were arbitrary aud capricious. and not
based upon sound public policy
3. That incomes from investments IN
State and municipal bonds could not
be taxed.
DfRgcr AND INDIRECT TAXES.
The Chief Justice proceeded to a con-
sderation of the constitutional require
ments with respect OF the imposition OF
the two forms Of taxation. direct and IN
direct. and said that the trainers OF the
Constitution intended TO make the con-
! sent Of those who were expected 10 pay
essential TO the validity Of any tax Ihey
| had lust come out Of a conilct upon
| the great principle Of taxation WIN Tep'e-
sentation, and they were intended 10 go
together: that Congress should 80 I'M
pose q tax that II would fall with even
uents OF those who voted for 1t.
The states represented In the Constitu-
| tional Convention. said the Chief justice,
| surrendered their rights 70 levy inP2sts'
| exclses ana duties, 70 the General Gov
/ eminent. they looked forward 10 the
time when the great States TO the west
OF them would be coming into the Unlon'
and when they gave up that right ihey
ala so with conhderce that the rule OF
uniformity would be observed IN inc iay-
ing Of taxes by Congress.
The first question TO be considered, sald
Chief Justice Fuller, was whether or not
a tax on rents IS a direct tax WITHIN the
meaning Of the Constitution. IL had al
ways been held. he said, that tax on
| estate, real or personal, was dlIect YAK,
| bat IL might be that the Constitution haa
a different melning. and that 1t was 10 DC
applied 10 this case.
DIRECT TAX AZ A LAST RESORT.
In that view 1t became necessary TO in
! quire what were direct taxes at the time
| the Constitution was adopted. Inc Chlei
| Justice then made extensive quotations
| from the history Of the debates III lne
convention on the subject of taxation.
| The inference from them, he said, WAS
| that the general distinction between dl-
rect and indirect taxation was well unaer-
stood BY the members Of the convention,
and that the expectation was that di-
rect tax would be the last resort OF Con-
gress.
The celebrated case Of Hytcn Us. the
! United Stetes, decided March 3, l1yt' was
| then referred 70 at great lengtn, the one
| in which il was held that a tex on car
| rlages wos not a direct tax. The several
! opinions fibYd by the justices were
| quoted, and Mr. Chief Juctice Fuller as
serted that I'm none Of them was there
ary expression Of opinion as TO whether
| or not anything except land and capita
| ton taxes was a direct tax. but they
were confined to the case at hand.
| The case, ne said, seemed TO turn upon
| the declaration of Hamilton as u what
constituted direct taxes; If there had been
| a reference TO the decisions Of the coun-
| try from which the United States derived
it's Jurisprudence IL would hev been Ia
tai for i'm Great Britain income taxes
had always been treated as dir~ct taxes.
roRMRh DECISIONS REFERRED TO.
The opinion then proceeds TO review the
| decisions made by the Supreme Court IN
| cases arising under the law OF 1861. which.
! the Chief Justice said, counsel had con
| tended and declared that an income tax
was not a direct tax, and must be regard
| ed as controlling in the case under re-
| view. The principle Of stare decisus, he
continued applied only TO cases as are
| directly I'm 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 10 extend a decision on ques-
| tion if an error Of principle was likely
| thereby to ho rerpetuated or committed.
In the light OF these observations the
| oplnion considered the decisions down 10
] ~. IA,
| trat they were all distinguishable from
| the one i'm hand The Springer cSsc was
| no exception TO the rule. inasmuch as II
| did not present the point raised IN thls
] case-is tax on rents tax on feai
| estate? The Courts opinion continued, was
| unable 10 see any distinction between
/ a tax on real estate and tax on the
| rents arising from such real estate. Nhal
| Is land but the income therCOf2 was ask
| ed. The constitutional requirement was
that direct taxes shcUld be laid only by
| apportiCnment among the States accord
| Ing to population and this tax was di-
| rect tax. There was no distinction be-
| tween an annual tax on the value or the
| land and a tax on the land itself. con-
! stituiional provisions, 1t was said' couid
not be thus evaded: II was the substance
and not the form or shadow mat Was 70
prevail i'm constituting them. Upon ms
/
| some of them were quoted.
| s.\Vhat the Constitution INTENDED TO
prevent" said the Chief Justice, was
| that no tax should be laid on the resi-
| dents of any state by the representatives
Of other states" The exercise OF 'he
| mower To levy direct taxes was 10 De Ie-
| stricted TO extraordinary occasions:
! In conclusion. therefore, upon tils
noint the Chief Justice announces li"'
| the court was of the opinion tha' 1h"'
mart az the tax imposing taxes upon Ieh's
| obtained from real estate was lnNahu'
! Next in order the opinion considered the
| third objection 10 the law Th~t IL III,
| noeod a fax upon the incomes derived
! fror, Investments in state ana nulhcipal
| bonds and WAS. therefore, Invalid Ohlei
| Jnstioe Fuller asserted the generAl Pll,,-
| ~ tb,t a tax ON Government 'bonds
Was held 10 be a tax on contracts, ".u
] oraiudiclal TO the public interest," II
was therefore. obvious that sucn ,aN
ON mo ,ovver of states or municipalities
80 rnake contracts was preludlclal To
| nuhiic policy. and, therefore. uhCuhs'tV-
| ticnal on the matters in lolNed III the
| case Of Hyde VS.. the Conuhehesi -, 70
| Company. of New YORK city' a',N :" IN
| case Of John G.. Moore VS. 'osepr . III ~
| Ter. commissioner OF lnterhal NeNe.'ue' ~.
| for an injunction TO restrain mn ,,daSa1
proceeding 10 carry out the law aipSai0D 1",''.
| ftom the court Of the DislIlCt oi Ni.'s'. .,.
| hia Chief Justice Fuller s,a.eu ,... u,ss "a.
court WAS equally divided. lne yuue yasp ~ =,
of the lower courts. as far as II , ~
| tho nayment of the tax on reii's anu -" ~, "
and municipal bends, was rere'SeS ,1 'o,,,..,4 80
| ,he Nroore case the effect or the VOu'
ha