The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1901-09-11


upon different businesses different stamp duties
upon different documents and general internal tax
law is full OF cassfcaons 1t imposes different peclc taxes
dogs dys and carriages and not most other kinds OF
personal property and without regard to their different values
and although these of property owned by
and not by Others imposes poll school and road taxes
males between certain ages and not females or other
males certain cergmen remen and soldiers in its dehn
ton OF personal property for purposes of taxation ad udorem
enumerae certain classes and om other classes OF
property imposes special income tax insurance com
panes wholly exempt certain classes OF property devoted to
educational and charitable purposes and property to
the extent of $500 by whomsoever owned whether 1T be the
whole part the property the individual No has
ever questioned the constituonality of these
determinations When innovation is made it apt to
be looked upon with suspicion and there tendency to regard
as involving principle principle from the mere
fact that accustomed to it. The points IN
ton involve merely applications of old princi
pies and all be sustained by application of those prnc
pies"
In the light of the principles above forth and the
referred to- would hardly necessary say show
not only that the legislature might classify but that did prop
ery classify between individuals and corporations this
instance Reference may however be made passages found
in regard to similar provision in the Federal law of 1894 in
Pollock Farmers Loan Trust Co., supra. Mr. Assistant
Attorney General Whitney said in his argument 157 Q. S.
40:
t is further said corporation allowed deduct
$4,000 from its before paying the tax is the
with individual The PLAIN Ihls not
gross income, but upon income The net income of
corporation radically different in character from that of
individual Among the elements which go make up the
economists wages of superintendent the value of the
labor of the individual himself See Mtser Magone, 155
o. s. 24O The individual business does pay himself
wages keep representing his estimate of the value
of his Everything that he makes and above
what he pays somebody else must be returned
income The net income of corporation the other hand
contains such element The wages of superintendent
SYST OF the salaries of its and counted
When the individual of the business Incorporates it. he
at begins pay himself salary from the funds of the
corporation If therefore the corporation allowed the
minimum individual there would be lack of uni
formy prejudical to the individual"
We believe only the Justices referred provision
in their opinions both jusfyng il. Mr. Justice Harlan, after
speaking of the exemption of incomes of individuals up
$4,000 said 5S u 676): "The allows corporations
when making returns of their profits income deduct
actual operating and business expenses Upon like grounds
suppose, Congress exempted incomes under $4,000" Mr.
Justice Brown said Qb 694 The exemption of $4,000
designed undoubtedly the actual living expenses of the
large majority of families and the fact that applied
corporations explained by the fact that corporations have
corresponding expenses The expenses of earning their profits
of deducted in the the correspond
ing expenses of private individual deducble from the
earnings of his The moment the profits of corpora
ton paid the stockholders the exemption of $4,000
attaches to them in the hands of each stakeholder"
That the assigned for this distinction by Mr. Justice
Brown namely that the exemption of $4,000 for personal
and family expenses and tha corporations have
spending expenses that the legislature had in mind
is shown by the provso contained Ill Section of the Act
(which provides for deductions of necessary expene) shat
deduction shall be made for personal family expenses the
exemption thousand dollars mentioned Section being
In lieu Of same
Not only have corporations no personal or family
but estimating their incomes for the purposes of the they
allowed deduct the of all labor employed earning
the income, while individuals allowed deduct only the
cost of hired labor without allowance for their time
labor
Point D. unwarranted exemptions.
) The Act have een exempts incomes Of individuals
up to thousand dollars and have also this is
intended to be in lieu of personal and family expenses It is
conended that this unreasonable and arbitrary exemption
1t to be conceded that exemption of
could properly be made exemption of $500 allowed
under general property law The question whether
the amount of thousand dollars excessive 1t hardly
De contended that it large manifest purpose the
part OF the Legislature to step from its proper sphere of action
providing for and the form of law merely
for the purpose of arbitrary exacon conaton from the
few wealthy members of the community.
In England exemptions of $3.50 have been allowed In the
Federal income laws of 1S6170 the exemptions at
different $500 $500 $1,000 $4,000 In Massaehu