The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1901-08-27
INCOME LAW
IS VALID
Continued from Page -

lhapphcaole to subjects which It is be-
yono the power of the legislature m +ax
may sun operate so as to give effect to
-ne hldih purpose Of the Legislature il
may stand as to matters properly wftain
Its scope. No doubt a str;cter r,,Ia an
paes TO criminal statutes But this is a
civil statute. Nor Is the striking out Of a
part OF what Is within the terms of a
statute the same as striking out an in
valid exemption or exception named In
the statute, for in the former case the
legislative viii would merely be given
eHect' while In the latter case to strike
out an exception would be to extend the
operation of the statute to what the
legislature had expressly excluded The
court cannot legislate
AS TO DISCRIMINATION.
In dealing with the argument present.
ed as to the alleged discrimination. the
court holds:
There Is perhaps no necessity of rely
ing on either the 5th Amendment or
Section 80 of the Organic Act to show
that, while the legislature may classify.
1t cannot arbitrarily discriminate In mat
ters of taxation. The restrict ons inher-
ent in the nature of free government and
! American institutions as well as in the
) very definition of tax may be sufficient
10 prevent unjust discrimination AS
> was said in the dissenting opinion in
? Campbell V. Shaw supra that opinion
, In this respect arriving on general prin-
) ciples at the conclusion that the majority
OF the court drew from certain proyi-
sions in the constitution of the Republic
! OF Hawaii, since abrogated: ".Ae attri-
butes of equality and uniformity inhere
: however, to some extent in the very idea
: of a tax and, referring to the 18th
= Inns and RI Grot al
provisions requiring equality and uni
formity, 1T Is everywhere conceded that
) these provisions do not take from the
: legislature the power to select or classify
the subjects of taxation, whether per-
sons or things. The rule of uniformity
: is complied with If all persons or things
= in the same class are treated alike, and
5 the rule of equality requires the exist
: ence of the power of classification. For
3 II but one kind of tax could be laid and
J. that by an iron rule of uniformity, tax
:. alton would fall unequally on different
persons. Where natural distinctions re-
quire discrimination, not to discriminate
works injustice. Our constitution re-
. quires approximate real equality of re-
suit in the aggregate, not mere equality
{ in form in the case of each particular
; tax. But when there Is selection or clas-
9 sification 1t must be real classification;
= it must be based on reasonable grounds;
2 IOtnerWlSe II would not De class HcatlOn.
: To arbitrarily discriminate would be ex-
) action, extortion, confiscation; not tax
alton And this is the distinction every
where taken. If there Is real classiflca-
!. ton, the court cannot interfere, II there
Is arbitrary caprtcious or unreasonable
Z discrimination the court may interfere.
, There is always, however, very strong
2 presumption not only that the legislature
intended to act constitutionally. but that
Tod in he
: should not declare an act of the legis-
; Iature unconstitutional except In a very
I clear case.
}. UNWARRANTED EXEMPTIONS.
AS to the question of unwarranted ex-
emptions. the court says:
(a) The Act, as we have seen, exempts
incomes of individuals up to one thou
sand dollars, and, we have also seen,
n This is intended to be in lieu of personal
and family expenses. 1t is contended that
this is an unreasonable and arbitrary
exemption.
- It seems to be conceded that an ex-
emption of some amount could properly
be made just as an exemption OF sou
is anowed under our general property
tax law The question is whether the
amount of one thousand dollars Is ex-
s. cessiye. 1t can hardly be contended that
I, Is so large as to manifest a purpose
s. on the part of the legislature to step
from its proper sphere of action In pro-
~ viding for a tax and to use the form OF
> a tax law merely for the purpose of ar
q bftrary exaction or confiscatton from the
81 few wealthy members of the community
i WITHIN DISCRETION OF LEGIS-
j LATURE.
q The court further holds that 1.-THE
81 amount of an exemption Of this kind is
q largely within the discretion of the Leg
n islature, and the court cannot say thai
II abused it's discretion in this in
q stance"
g In referring to the section which says
q that only one member of family sinai
81 enjoy the exemption of $1,000, and thai
q this would be a discrimination between
n large and small families, and married
q and unmarried persons. the court says
g similar provisions were made IN the
81 Federal income tax laws, and thougs
q the same arguments were urged
81 AGAINST them, we believe no member
q of the court alluded to them
n ABSOLUTE UNIFORMITY IMPoS:
q SIBLE.
A., 20 ,ba question of equality. tbs
q court says:
Il II Is impossible to attain aosolute
81 equality or uniformity IN taxation APP Ip
81 proxinnate equality and uniformity Is q!
a PA =. ao,,ired The legislature may
& c cla objects and provide different
q u.a+bods of estimating amounts or values
81 So long as it acts in good faith and OF OF
8 general lines and marks distnctions ~
q Some reasonable basis. the courts canine
q i,+arfsre The provisions in question
seem seem to be in harmony with the genera
4 tbeorv of the Act The Act seems {
q dasI with units whether corporate or pr
g vate 1t treats as unit all wheth 'e rev
e ~ many large or small, whose incom'
70 t.oor,as ON the one hand and expense
Is Oh tbe other hand are combined Tax
b al laws must be practical They can
B not be utopian. Perhaps no two per
b sons would agree as TO JUST
n narfect tax law should be. IL IS cas-:
q - raise objections. but the moment al
attempt is made to obviate the oo1eeuo IN
3 Iv framing the law differently new %