The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1903-06-19
ESTEE WAS
SUSTAINED
TEXT OF DECISION or COURT OF
APPEALS IN SAN FRANCISCO IN
TAX APPEAL CASE RECEIVED.

Judge Estee received in the last mail
a copy of the decision of the Ninth Cir
cult Court OF Appeals, sustaining his
decision In the case OF Peacock v Pratt
involving the constitutiOnality of the
income tax law. The appellate court
finds that there may be defects in the
law. but they are not fatal and must be
opposed apart from the whole act. The
following rulings are laid down:
Article section l OF the Constitu-
tion OF the United States requiring
that all duties, imports and excuses
shall be uniform throughout the United
States establishes the rule only for
taxation by the federal government,
and has no application to the powers
of taxation of state or territorial le-
gislature.
THE provision of the organic act OF
the Territory of Hawaii that the le-
gislative power of the territory shall
extend to all rightful subjects Of le-
gislation. not inconsistent with the con-
stitution and laws of the United States
locally applicable includes full and
comprehensive power TO legislate In
the matter of taxation.
"A provision of an income tax law
exempting from it's opera ron private
schools, colleges, commercial colleges
and fraternal benefit societies does not
make an illegal discrimination which
renders the law invalid as to other cor
porations or persons upon whom the
tax is imposed.
THE provision of the fourteenth con.
stitutional amendment which for
| bids states to deny to citizens the
equal protection of the laws does not
require taxes TO be levied by uniform
method and at the same rate upon
every class of property, bpt the man
ner of taxation with respect to each
class is left to the legislative discretion
"A law imposing an income tax on
persons and corporations does not dis
criminate illegally against the latter
because it allows each person or the
persons composing one family, a rea-
sonable income exempt from the tax,
nor is $1,000 per year an amount so
unreasonable as not to be within the
legislative discretion.
THE fact that an income tax law
does not expressly exempt the salaries
of judges from the tax. or that it au-
thorizes unreasonable searches and
SclEuitSi VI lGiulito NiAt IiobuSAANih ~
a taxpayer Of evidence discriminating
himself in violation of the Constitution,
does not invalidate the law as a whole,
and the protection of the Constitution
because of such illegal provisions can,
only be invoked by one against whom
they are sought to be enforced"
The opinion of the Appeal Court was
delivered by Judge GilbeEt and con-
cluded as follows:
Upon careful consideration of the
act and of the averments of the bill we
discover no ground for enjoining the
collection of the tax and therefore find
no equity in the bill The act was
undoubtedly intended to remedy the
! depletion of the revenues of the ter
, ritory which is described in the bill
1t contains no evidence of an inten-
: ton to unjustly or unfairly discrimi.
= aate. 1t places the burden of taxation
, upon the points of strongest resistance
where it is easiest borne. The sam,
) objections TO the law that are here
! urged were presented to the Suprem,
5 Court of Hawaii Territory in Robert
I son V. Pratt, 10 Hawaii, $50, and tn,
law was sustained by n majority o
the court. There being no equity il
! the bill. it becomes unnecessary u
consider the other grounds of demurre
: The decree of the District court dis
missing the bill is affirmed"