The Hawaiian gazette., 1901-08-02
MUST PAY
FULL TAX
CorporationsHave
No Thousands
Exempt.
q INCE a corporation has no SOUL
~ Il is nnt entitled To the eNemnilmn

& lNCE corporation mas no soul,
- it is not entitled to the exemption
that is given an individual, in the
income tax Office ruling.
Whatever may be the result of the
proposed contest against the validity
of the income tax law, some there will
be who will hold that a mistaken rul-
ing has been made in the mater of eX-
emptions. This lies in the holding of
the ONCE that there cannot be any free
dom from taxation on the part or cor
porations of the $1,000 provided in Sec
ton l of the law.
II is the holding of the tax office
that the $1,000 which is taken off the
incomes of persons does not apply to
the organizations of capital, as there
is no specific entity. The holding is
that the exemption was made to pro-
vide for the personal expenses of the
taxpayer, and since there could be no
such claim made on the part of a cor
poration, there is no reason for the
exemption.
This brings UP an interesting condi-
ton, for it was the intention of at
least a majority of those who gave
any thought to the law, that the ex-
emption be applied to each taxpayer,
whether an individual or company.
The reason for this was to escape the
charge and claim that the act was spe
cial or class legislation, and thus insure
in advance it's defeat. 1t was to give
no good ground for contest as to the
unconstitutionality of the law, that its
terms were made general, and the ad-
verse holding of the tax office 1t is
feared may lead to the result which
was sought to be avoided
Senator George Carter said yester-
do "a
being considered in committee, this
matter was talked of and the conclu-
sion reached that this general exemp-
ton was necessary, for any other pro-
lection to the worker would be OPEN
ing a door for the contesting the valid
ity of the tax. 1t was the decision
then that there could be no way of
making difference between the indivd-
ual and the corporation, and the word
ing was made as simple as possible.
The intention at that time was that
the rule should be general, and that all
should meet the same conditions"
over two thousand returns were
made up to last evening by citizens
and corporations liable to the income
tax All day yesterday the tax office
was blocked by line of waiting appli-
cants, two and three deep, but by the
time the office was ready to close the
crowd had dwindled away. The Chi
neSe seemed DE most III tNlutllCe,
and to the ordinary observer it would
have appeared that all the rich men
in Honolulu were Asiatics. Watching
the proceeding for a while made a very
different impression, for while it re-
quired less than a minute to dispose
of Americans or natives, the Chinese
would linger about the office for from
five minutes to an hour each, the
deputies slowly and carefully explain
ing to them each point in the new
law.
There was some little friction at the
tax window, several men refusing to
make any statement of gross income,
and giving only the net income. 9th
ers made a return of only total mon
les received and paid out, and refused
to give the items making up the sched-
ules. These returns the collector re-
fused to accept, and the men had the
option of filling the blanks according
to law, or not making a return, and
laying themselves liable to the heavy
penalty prescribed.
Schedule 3, which allows for exemp-
tons, is causing the most trouble. the
majority of the taxpayers giving house
hold expenses, money paid servants
and all sorts of reasons for making de-
auctions from the income actually
given. Few people take the law Sc
riously, and say they are making the
returns simply because the law re-
quires it, and not with the expectation
that they will be called upon to pay
the tax. The collector expects a tota,
of $500 returns, and of these, 1000 are
already in, so that the rush tomorrow
will not be very great. All OF the
corporations and big taxpayers have
made their returns, and it is the small
salaried men and women who are no,
in yet. There are very few womer
who think the law applies to them
and not more than a score have sworr
to statements. Probably a hundred
Chinese have made returns. the large
majority Of the taxpayers being Am
orleans