The Irish standard. [volume] (Minneapolis, Minn. ;) 1886-1920, 1895-04-13

THE INCO E IA Z.

y HE IN COM b IA
| Action Of the Supreme Court Of
11cially Made Public.
Extracts from tho Opinions OF the Jus
tices- Ronts and Interest on Bonds
Exempt. But the Law e Valid
In Other Respects
WASHINGTON. April 9.As forecasted
by the newspapers for several days, the
supreme court has decided that
the income tax law is uncon-
stitutional SO far as & it affects
incomes derived from rents and real
estate or from state, county and mu-
nicipal bonds. The court was divided
as to the remainder of the law, and az
the decision Of the court below was in
favor Of It's constitutionality, that de
cision must stand.
An Accurate Forecast
Chief Justice Fuller read the decision
before one of the largest audi.
ences that ever crowded into the
courtroom. The closest attention
was accorded him. but it was soon
evident that the press forecast had
been an accurate one, and hence there
was less interest taken in the decision
than would have been the case had il
not already been discounted in the
newspapers.
How the Justices Stood.
Upon the question of the constitu.
tionality of the taxation of incomes
from state and municipal bonds the
court was unanimously in the mega
tive.
Upon the question of taxation OF
rents the court stood as follows:
Affirming the law =. Justices Harlan and
White
Against the law-Chief Justice Fuller, JUS
tices Field, Gray, Brewer, Brown and Shtras
Upon the general question of the
constitutionality Of the law, the court
is said to be divided as follows:
For the law--Justices Harlan, Brewer
Brown and White.
Against the law-Chief Justice Fuller. JUS
tees Field, Gray and Shiras.
Synopsis Of the Decision.
The conclusions Of the court were
stated to be as follows:
l. That by the constitution federal taxation
is divided into two great classes: Direct taxes
and duties, in1portszand excuses.
2 That the imposition OF direct taxes Is
governed by the rule Of apport1onment among
the several states, according to numbers, and
the imposition OF duties. imposts and excuses
by the rule OF uniformity throughout the
United States
I, g. That the principle that taxation and rep.
resentation go together was intended to be
and was prescribed in the constitution by the
establishment OF the rale OF apportionmen,
among the several states, SO that such appor.
tionment should be according to numbers ir
each state.
That the states surrendered their power
to levy imposts and to regulate commerce tt
the general government and gave 1t the con.
current power to levy direct taxes In reliance
on the protection afforded by the rules pre-.
scribed, and that the compromises OF the con.
stitution cannot be disturbed by Legislative
action.
s. That these conclusions result from the
text OF the constitution, and are supported BY
the historical evidence furnished by the cir.
cumstances surrounding the framing ant
adoption of that instrument, and the views Of
those who framed and adopted 1t.
. 6 That the understanding and expectation
at the time Of the adoption Of the con-
stitution was that direct taxes would
not be levied by the general govern
ment except under the pressure of ex.
practice down to August 49, 1894 II The power
to do so is to be exercised as an ordinary ant
usual means of supply. that fact furnishes ar
additional reason tor circumSpectton In dis.
posing OF the present case.
T. That taxes on real estate belong to the
class OF direct taxes, and that the taxes on the
rent or income of real estate, which Is the In.
cident OF Its ownership, belong TO the same
class.
That by no previous decision OF this court
has this question been adjudicated to the con-
trary Of the conclusions now announced
That so much OF the act Of August Is, 1894
as attempts to impose tax upon the rent OF
income Of real estate without apportionmen,
as invalid.
The court is further Of opinion that the act
OF August Is, 1894, is invalid so far as it at
tempts to levy tax upon the income
derived from municipal bonds. AS mu-
ntcipal corporation is the representative of the
state and one Of the. instrumentallties OF the
state government the property and revenues
OF municipal corporations are not the subjects
OF federal taxation, nor is the income
derived from state, county and municipal
securities, since taxation on the interes,
therefrom operates on the power to borrow
before it is exercised and has sensible indu.
ence on the contract and therefore such tai
is tax on the power OF the states and theil
instrumentallties to borrow money, and conse.
Quently repuRnant to the constitution
Justices Are Divided In Opinion.
Upon each OF the other questions argued 81
the bar, to-wit: 1. Whether the void provi.
sions as to rents and income from real estate
invalidates the whole act7 2 Whether as tc
the income OF the personal property as such, thu
oct Is unconstitutional as laying direct taxesl
& W:h1thst.ssnys part ot the tax, II not con-
stdered as direct tax, is invalid for wantol
uniformity On either OF the grounds suggested
the justices who heard the argument art
equally divided and therefore, no opinion IL
expressed
The result Is that the decree OF the Circuit,
court is reversed and the cause remanded with
directions to enter decree in favor OF COM
platnant In respect only OF the voluntary pay
mont Of the tax on the rents and income OF III
real estate and that which 1t holds In trust
and on the income from the municipal bonds
owned or 80 held by It
The Line Of Argument.
The power to decide law unconstitutional
the chief justice said, was used with reluc-
lance, but the responsibility could not be
evaded when the necessity arose Tho con-
tentions respecting this law were:
I. That tax on rents was tax on real es-
tate and that not bong laid according to ap-
portionment it was invalid.
That twas not uniform, and violation
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