New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1900-05-15
INHERITANCE TAX VALID.
WAR REVENUE LAW PROVISIONS UP.
HELD BY THE SUPREME COURT.
ESTATES COMPOSED OF GOVERNMENT
BONDS ALSO DECLARED TO BE
TAXABLE

Washington. May 1.-THE Supreme Court OF
the United States to-day announced opinions In
the cases arising under the inheritance tax pro-
vision of the War Revenue act. and also in a
case involving the applicability of the In
heritance Tax law Of New-York to estates COM
posed OF Government bonds. There were Ave
decisions under the Federal law and one under
the State law. but two of the former class an
Piled. as did one OF the latter class to the taxa
ton OF Government bonds. The Court held thai
neither under the State nor the National enact
ment were Government bonds EXEMPT from, tan.
alton The validity of the general Federal law
was affirmed. but 1t held to be purely ap-
phcable to legacies. and TO the entire estates
OF deceased persons the Court holding that tho
tax is on the passing Of 1egacies or distributive
shares of personality. with progressive rate
on each. separately determined by the sum OF
each of such legacies or diNributive shares"
me decisions dealing with the Federal law
as whole were handed down by Justice White.
Justice Shiras.
DECISION OF GREAT IMPORTANCE
sohcitor-General Richards. who conducted tho
vase Ior the Government before the Supreme
Court. made the following statement.
me tax on legacfes and DISTRIBUTES sbaraa IN,
GUIDED in the War Revenue act of issS is v IA
the syS according 70 the degree OF kinship OF
legacy The initial rate is determined by the dee
exempt. Legacies to others must paw a tax WbicE
as tne degree OF knshp is remote until
raDt passing 20 strangers in blood pays 5 per
eordpr 70 t initial rate progressive rate
Piled Property valued at $4,000 and under l. e2
ehhPt, exceeding 10000. but not exceeding 5000,
the amount Until properly exceeding so o is wi ra
S 81 Three to pay the rate fixed by Hshp multiplied
B The law Is assailed number of grounds
tr,eylng upon the decision in the income tax cases.
II was insisted that the tax falls upon the property
passing, and Is therefore direct. and, being unap-
portloned among the States. is invalid 1t was
next urged that If not direct tax upon the prop
and since that privilege eeate b OF tb fsa
cannot be taxed without Interfering with the re-
OF property Again it was urged that If an ex-
all estates or egacies at the Same rates b b1s
exempts some and taxes others unequaIly making
The ae Wss dee9 the smf
and dangerous Finally, 1T insisted that the
invested in United States bonds because they are
taxation
POWER To TAX PRIVILEGES
q, Upon al these points the Court found in favor
OK sne n en- The cases directly involved
Importance grows out of the fact they sustain
ent to tax the pTPe Of Of nhe peape79
although that privilege is granted and regulated BY
to apply in such taxation the graded progressive
and wisest method of reaching the great ssrateS
and making them bear their fair shares of the pub
valuable subject matter Of taxation and the most
valuable privileges conferred by the States IL
the general Government. in raising money were
confined 10 the taxation of privileges granted bv
itself an invaluable source of revenue would be,
denied.
1t be well TO call attention to the fact that
the Court in constituting the law. took the emil
nently fair and just view that the exemption and
graded rate IS based upon the amount of the legacy
received, and not the volume of the estate out OF
which II Is paid. A legacy of $4,000 under IS
exempt. no matter what the size the estate out
of which it is paid legacy over 100000 in value
pays rate determined by the amount OF the,
legacy and the kinshp of the legatee