The Laurens advertiser. (Laurens, S.C.) 1885-1973, 1908-01-15
RECEIVERS
TAX ON WHISKY
Commissioners capsrs Decides That the
Government Should Refund Amount
y Paid by South Carolina.

PaidTDy 0ut carolina.
Washington, January IL. = In the
matter of the claim of the State of
South Carolina for the refunding of the
amount paid by it as taxes alleged to be
due from the retail dispensaries Of that
State for the sale Of fermented malt
liquor sold in wholesale quantities, John
G. Capers, commissioner Of internal
revenue, has decided that the evidence
obtained on the part of the federal
government would not be sufficient to
sustain the governments contention in
court and that, therefore, the amount
paid by the State under protest, $4,-
525. OIL, should be refunded.
In reviewing the case in announcing
his decision, the commissioner says.
THE claim is based upon two grounds
First, that the tax, if due, should have
been collected from the individual dis
pensers, and not from the State, rely
ing in this contention upon,t the decision
OF the Supreme Court of the United
States in the cas- of South Carolina vs..
the United States, 100 u. S. 437; Sec
ond, that there is a failure of proof on
the part of the government to sustain
the tax"
The commissioner states that he is
unable to agree with the first conten-
ton of counsel for the State, as his
reading of the decision of the court in
the case referred to leads him to the
conclusion that the main question de-
cided by the court in that case was
that the State had engaged in the bust
ness of selling spurious and ferment-
ed liquor; that such business was not a
legitimate function of government, and
hence the State, having engaged in an
ordinary line of business, should be
held taxable by the federal govern
ment, just as an individual would be
taxable under similar circumstances.
With regard to the second contention
that is, a failure of sufficient proof
on the part Of the government, the
commissioner reviews at some length
the afidavits filed, pro and con-those
of State officials, dispensers, e
officials and officials sen into the field
subsequently to review all of these
statements, and concludes that there is
a lack of evidence on the part of the
government to sustain the tax, and has
ordered that the amount paid under
protest be refunded.
The decision of the commissioner dis
tinctly holds the State, through it's dis
pensers, liable for tax as wholesale
malt liquor dealers where they sell in
wholesale quantities, and the revenue
officers will continue their investiga-
tons along these lines. In the cases at
hand, however, in which the tax had
actually been assessed and paid into the
treasury, it was found that sufficient
evidence had not been procured to sus-
tain the collection of the tax, and it
will be refunded.
1t will be remembered that last sum-
mer w. F. Stevenson, of Cheraw, came
to Washington and argued this case be-
fore the commissioner, and Mr.. Capers
stated at the time that he would rem
der an opinion in it as soon as possible.
Had the decision of the commits
sioner been against the State it would
have been necessary for the State to
have paid between $25, 900 and $50, 600.
The amount ordered refunded repre-
sents only M installment of the sum
assessed against the State.