Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1910-06-01
Cases Will Be Re- argued
Before Full Bench.
Supreme Court Sets Gases tor
First Of Next Term.
Tax Required to Be Paid July T.
Complications May Result.

Washington, May 31.-Just before ad-
journing today until next October the
supreme court of the United states
restored the Is corporation tax cases,
heard last spring, to the docket tor
re-argument before full bench.
No specific date was set for the re-
argument. AS two cases, touching the
constitutionalty of the law and its
applicability to certain organizations
have been set already for the first
Tuesday of the October term after
long list of cases previously assigned
for hearing on that date, it is believed
the court will advance the Is cases IN
question for a hearing in the same
month.
Chief Justice Fuller made the an
nouncenent of the restoration.
For argument before a full bench
was the only reason assigned for the
unexpected action of the court. Inc
cases were argued on March II and Is
before a bench consisting of eight
members. When Justice Brewer died
shortly afterwards. it was thought
that the cases might be restored to the
docket. The Standard Oil and the To-
bacco dissolution cases were re-asslgn :
cd shortly afterwards, but nothing was
said about the corporation tax cases.
Inasmuch as the tax must be paid by
July |, it was believed the court would
announce a decision this term.
The only reason advanced for the
delay of the court in re-asslgnment Oh
the cases was that the court hoped IT
would reach a satisfactory decision OIL
the matter before the summer recess
and thus avoid a re-hearing.
How the court stands on the cases.
no one off the bench pretends to know.
The only decision of the court which
in answer approached these cases was
that in the income tax cases. OF those
who declared that law unconstitutional
only Chief Justice Fuller remains on
the bench. Justice Harlan and Justice
White are the only ones who believed
the law constitutional. now members
of the court.
The action today will allow Governor
Hughes of New York, recently appoint
ed to the bench to participate in the
consideration of the law. Justice
Moody who has been absent from the
court this year on account of Ill health
will probably have returned to his
seat on the bench by the time the cases
are rc-argued.
Secretary MacVeagh said that not
withstanding the failure of the court to
BASS on the conStitutionality of the
corporation tax, the treasury would
proceed to collect it as required by
law. Should the court, after re-argu
lnent. declare the tax not constitu-
tional. the money collected will be re-
funded without the necessity of con-
gressonal legislation. the statutes
making ample provision for the re-
turn of taxes paid wrongfully or in err
ror.
The CORPORATION tax is collectable
June 30. The assessments on that ac-
count have aggregated tri1e in eX-
cess of s27, 100000. while the taxes
paid to date amount to $675,325.
Washington. May 31.-Presiden
Taft is regarded as the father of the
corporation tax idea as represented in
this statute. He evolved it during the
discussion of tariff legislation and in
come and Inheritance taxes in 1908
1909. As result, Congress inserted the
Corporation Tax Law into the
Payne Aldrch tariff act nassed by
Congress last summer. 1t became Sec
ton 80 of that statute.
Tho law subjected to the tax in q
general way every corporation, joint
STOCK company. or ASSOCIATION, organ
lied for profit and having capita
81,
erv insurance company. The tax was
designated as "a special excise taN
with respect to the carving on or do
ing business and it was provided that
IT should be equivalent to one pei
cantum uron the entire net income
over and above $4,000 received "from
all sources during the year. There
We're to be excluded from the income
however. amounts received as divl-
dends upon stock of other organiZa
lions subjected to the tax. Exempted
from the tax were certain Organiza
lions. such as labor. agricultural. nor
ticultural and fraternal beneficiary So
cieties.
One uaragranh of the law provided
for the publicity Of the returns re-
The tax was to be paid on or before
June 80 of each year. and the returns
for each year were to be made by
March ]. 1t was provided that the tax
should be paid for the wear ending
June 90 1910. although tn" law was not
passed until August 5. 1909
Not until shortly before tho expiration
of the time for the making of the returns
was the first move made to test the va
lidity of the tax. This movement to test
the great question about corporation law
started in the little town of windsor,
Vermont
There Maxwell Evarts, New york
lawyer son of the late William M. Ev-
arts. has summer home. He had often
noticed the keen competition between the
two general merchandise stores in the
town. the Stone Tracy Company, cor
poration, and Dwight Tuxbury e Sons.
a partnership concern: He saw what he
heileved was discrimination against the
corporation if it We're compelled to paw
the tax and make public its business ar
ransementS, and SO accepted the posi-
uoh OF counsel for Stella p Flint, as
rt ,-,,1