The times. [volume] (Richmond, Va.) 1890-1903, 1896-12-11

I efforts OF individuals In their various
caliiDgs.
When the law was brought before the
Supreme Court It held. In announcing its
iirst decision. that "A tax upon real estate
was direct tax and could be imposed
only by apportionmcnt among the States.
it was then confronted with the question
whether tax on the income derived
from real estate was not equally a direct
tax? Was that not In substance a tax
upon the real estate? The Court felt it.
self compelled to say that ii was. and II
seemed impossible 10 say that the Court
was wrong in this opinion. IT seems
utterly untcnable 10 say that tax upon
| house Is direct tax but that a tax upon
the rent that "A hsise yields Is not a direct
tax When the first decision was an
| nounced, therefore. the Court held that
so much OF the income tax law as i'm
posed a tax upon the income yielded by
| real estate was a direct tax, and that as
it was not apportoned amongst the States
according to population. it was repusnant
| 10 the Constitution and void.
1
tax municipalities It could not tax the
bonds that those municipalities may IS
sue. and, that as The law imposed a tax
upon the income derived from those
| bonds as well as upon all other incomes,
| It was void in that respect. The case had
been heard before eight Justices Mr.. Jus
uce Jackson being detained from Che
borrh by Illness when the first decision
WIS announced the Court after deciding
tae two points mentioned. announced that
mo eight justices were equally divided
upon the question: First, whether the
( void provisions Of the law invalidated the
| whole act; second whether as to the
I income from personal property as such.
| tho act is unconstitutional as laying direct
taxes; third, whether any part Of the
tax, II not considered as a direct tax,
IS invalid for want OF uniformity.
a rehearng was asked for and granted
by the Court and. upon that rehearng.
| Mr. Justice Jackson being present, the
Court decided the case by the voice of
h'~ Justices one way 10 four the other.
The five justices united in holding that
| tax on income derived from personal
property was as much direct tax as
tax on income derived from real prop
| crty and that. being direct tax, it was
{ repugnant to the Constitution for not
being apportioned amongst the States ac-
cording TO population; and they further
held that as the Court struck from the
act these three great subject matters that
ii acted upon they could not suppose that
| Congress would have passed the act at
all II it had known it would not operate
upon these three subjects. and therefore.
that the whole act fell with those proyis-
ions Of it.
Now. this review Of the case shows that
| the whole hubbub that was raised over
the second decision was on account Of the
Court holding at the second decision that
a tax upon income derived from personal
| property was just as much a direct tax
as a tax upon the income derived from
real estate. The ruling at the first de-
| csion, that tax upon real estate was
| direct tax, and that tax upon the in
| come derived from real estate was equally
a direct tax. was 30 reasonable that no
one raised any remonstrance against 1t.
| The row was made when the ruling came
| that a tax upon the income derived from
| personal property was just as much a
direct tax as a tax upon the income de-
| rived from real estate.
| Now, we are compelled, in all candor,
| to say that this ruling does seem to
us most reasonable. Men may decant as
| they please upon the distinctions between
| duties. imports, excuses and taxes. but
a tax laid upon a house is a direct tax.
| and tax laid upon a horse is equally
a direct tax, and tax laid upon the rent
! produced by house is equally a tax upon
that house. while tax upon what the
horse hires for is just as much tax
upon the horse as tax upon the rent is
a tax upon the house.
In all candor we are compelled TO ad-
nit that the argument seems overwhelm-
ingly with The majority of the justices,
and that the clamor which was raised
over their decision was due to blind pas
sion insic1l Of to cool reason.
w ....ly regret that 1t is not now
possl'. i.r Congress to lay a just and
impafil income tax. We determinedly
oppo ihc income tax which exempted
| S4OUU ~ income before the law was de-
clarcG unconstitutional-not because OF
its unconstitutional features. but because
of its unfair discrimination between cit-
zens all OF whom are equally entitled
to the protection of law and should
equally bear its burdens.
II $1,000 could be exempted. then $4,000 |
could also be exempted. and If 2 per cent. |
could be taxed. then 100 per cent, and the |
door would be opened for the practical |
confscation of the property Of certain |
citizens. and the worst sort OF class legis- |
lation would be naugurated with all the |
conflicts which are inseparable from the |
breach OF justice in any society.
We would be glad to see the Constitu- |
ton amended so TO permit a just, i'm |
partial and general income tax.
STATE BANKS OF ISSUE.