The sun. [volume] (New York [N.Y.]) 1833-1916, 1910-03-16
CORPORATION TAX BRIEF IN
GOVERNMENTS CONTENTION ~
THAT IT ~ VALID.

Attarney -G3eaeraI ASSERTS % u an ENclss
and Not = IDireet TaN-says PublIcsty
o. Proper Under Police Power and
shoald Ne Under raNing Power.
WASHINGTON. March I5.-The Govern
ment's brief in the test oase on the cor
poratio tax law was fled in the supreme
Court this morning Stella p. Flint q
Vermont il the appellant. but fourteen
other cases have been advanced for hear
ing with this case.
In regard TO the publicity feature Of
the law the Attorney General contends
that even II the publicity require
ment were obnoxious % the Constitu-
ton there would be no reason for hold
ing the tar invalid or Tor enjoining the
companies from makinR the returns.
Full relief SAID he. could bs had by
preventing the returns from being made
public. The validity % the publicity
feature is not properly IN issue in these
cases
The Attorney General contends, how
ever. that the publicity feature il not
unreasonable because the Government
has the right to adopt such measures
a. II deems essential TO insure true re-
turns. He says:
Besides. in this respect the provision
IL consistent with tho general practice
in other cases. The returns will not
Disclose materially different facts than are
published already by most corporations
IN their annual reports. II may rs that
some corporations do not give out their
annual reports to tho public generally,
hut the rule IL otherwise: and in an y
event IL can hardly be deemed 80 UNI
reasonable as tn violate the Constitution
that what most companies already do
IL expected of all
Like reports have for years been re-
quired from various kinds 81 business
enterprises by the States under their
police powers and by the Government
under it, power Ia regulate commerce
Why should that which il proper when
done pursuant tn the police power or
the power To regulate commerce become
improper when done under the taxing
power?
The tendency 10 avoid taxes by making
false returns IL indisputable and IL cannot
he better met than by suhjeCting the re
turns Ia the sharp scrutiny of vel in
formed compositions who arr Interested in
seeing that the reporting companies pay
their full taxes. The principle under
lying the provision - Identical with that
which has prompted many States 20 make
general publication 81 personal property
ret urns Some of them illinois. for
examplel even - 80 far - TO distribute
tO all taxpayers in each precinct lists
showing the amounts returned by each
person for taNation
The Attorneys General contends that the
corporation tar IL not direct tax upon the
property Of the corporations: that Il IN. on
the contrary. an excise tax. a. the statute
expressly declares. on the carrying on or
doing business by such companies and
that il therefore needs no AppoTtionment
among the States according To population
The Attorney General declares also
that the tar IL not imposed upon State
or municipal bonds nor upon the incomes
from such bonds forming part 81 the bust
ness assets Of taxpaytnR company.
He contends further that the tax ~
uniform as an EXCISE tax and that tho
imposition of the tax upon the business
of corporations and JOINT stock companies.
while kindred business 81 individuals and
partnerships RO untaNad. does not taKe
property without due process 81 Law and
docs not contravsne any rule Of equal
legislation implied from the nature of tho
national Government. lie denies that a
taxpaytng company IL subjected to any
unreasonable search ar seizure oT i'm
properly required to- incriminats ItEalf
He maintains this attitude In conclusion:
III in any part of its application THIS
taxing statute ~ unconstitutional u
should he sIsi aimed. nevertheless. IN all
other parts and applications.