Kingsbury County independent. (DeSmet, Kingsbury County, S.D.) 1894-1929, 1909-06-25
PRESIDENT TAFT ASKS
CONGRESS TO AMEND
THE CONSTITUTION
Suggests Corporations and
Joint Stock Companies Be
Subjected to Excise Tariff.

washington, June is. - ne iOIS
looked for message from the president
was forthcoming today, the tex hav
ing been submitted early in the day TO
members of congress.
In substance, Taft recommends, and
strongly, an amendment to the consti-
tuition OF the United States empower
ing the government TO levy a tax on
the national income without reference
TO the apportionment among states.
Another important suggestion was
that relating to an amendment TO the
tariff bill. which called for an excise
tax TO be levied upon corporations and
joint stock companies.
The text of the presidents message
is as follows:
ITO THE SENATE AND HOUSE
OF REPRESENTATIVES,
1T is the constitutional duty of the
president from time to time TO recon-
mend to the consideration of congress
such measures as he shall judge neces-
sary and expedient. In my inaugural
address, Immediately preceding this
present extraordinary session of con-
gresS, l invited attention to the neces-
sity for a revision of the tariff at this
session and stated the principles upon
! which / though the revision Shouts be
effected.
II referred to the then rapidly in
Z creasing deficit and pointed out the
obligation on the part OF the ramer
of the tariff bill to arrange the duty
SO as to secure an adequate income and
suggested that if 1t was not possible to
do so by import duties, new kinds OF
taxation must be adopted, and anon
them | recommended a graduated in
h~eritance tax as correct I'm principle
and as certain and easy of collection.
House Obeyed Orders.
THE House of Representatives has
adopted the suggestion and has pro-
vided in the bill it passed for the coll
lection Of such a tax. In the Senate.
the action of its finance committee and
the course of the debate indicate that
IL may not agree to this provision, and
1t Is o proposed to make up the de-
felt by the imposition of a general in
come tax in form and substance of al
most exactly the same character az
that which in the case of Polloc versus
Farmers Loan and Trust 157
u. s. 429, was decided by the supreme
court TO be a direct tax and therefore
not within the power of the federal
government to impose unless appor-
toned among the several states accord
ing to population.
This new proposal. which / did not
discuss in my inaugural address, or In
my message to the opening OF the
present session. makes 1t appropriate
for me to submit to the congress certain
additional recommendations.
The decision Of the supreme
ocurt in the income tax cases de-
prives the national government Of
a power which, by reason of
il was generally supposed to
have had. IL is undoubtedly a pow
err the national government ought
to have. II might be indispensable
to the nations life in great
crises.
nAI+ho,~ bo,o 80 coincidence
constitutional amendment as necessary
to the exercise OF certain phases OF this
power. a mature consideration has sat
isfied me that an amendment is the
only proper course for it's establish
ment TO its full extent.
Recommends Amendment.
Il THEREFORE,, RECOMMEND To.
THE CONGRESS THAT BOTH
HOUSES, BY A TWO-THIRDS VOTE,
SHALL PROPOSE AN AMENDMENT
TO THE CONSTITUTION CONFER
RING THE POWER TO LEVY AN
INCOME TAX UPON THE NATION
AL GOVERNMENT WITHOUT AP-
PORTIONMENT AMONG THE
STATES IN PROPORTION TO POP
CLATION.
This course is much to be pre-
ferred TO the n proposed OF ~re-enact-
ing a law once judicially declared to
be unconstitutional. For the congress
to assume that the court will reverse
itself. and to enact legislation on such
an assumption will not strengthen
popular confidence in the stability of
judicial construction of the constitu-
ton. 1t is much wiser policy 10 ac-
cept the decision and remedy the defect
by amendment in due and regular
course.
Again, it is clear that by the en-
actment Of the proposed law the con-
uUiII NOT ha hrjnDfnO p,nnau srfn
the treasury to meet the present de-
iciency, but by putting on the statute
book a law already there and never
repealed, will simply be suggesting TO
the executive officers of the govern
ment their possible duty to invoke liti-
CATION. If the court should maintain
it's former view, no tax would be col
lected at all. If it should ultimately
reverse itself still no taxes would ave
been collected until after protracted
delay.
ut is said the difficulty n delay
in securing the approval of three
fourths Of the states will destroy all
chance of adopting the amendment.
OF course. no one can speak with cer-
tainty upon this point, but / nave be-
come convinced that a great majority
Of the people of this country are in
favor of yesting the national govern
ment with power to levy all income
tax and that they will secure the adop-
ton of the amendment in the states,
IL proposed to them.
Cites Pollock Case.
Second, the decision in the Pollock
case left power in the national govern
ment TO levy an excise tax which ac-
complishes the same purpose as a cor
poration income tax, and is free from
| certain objections urged to the pro-
posed income tax measure.
IT therefore recommend an amend
ment to the tariff bill imposing upon
all corporations and joint stock com
panies for profit, except national
banks otherwise taxed), savings
banks and building and oar associa-
| lions, an excise tax measured by 2
per cent on the income of such COR
porations. This Is an excise tax upon
the privilege of doing business as an
artificial entity and of freedom from a
general partnership liability enjoyed by
| those who own the stock. y
Tax Upon Success.
~ am informed hat a 2 per cent tax
20 thts character would bring into the