Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1911-03-16
Supreme Court Of United States
Unanimous in Opinion on This
Measure.
LONG CONTROVERSY SO ENDED
Justices Hold II ar Excise TaS
on Corporate Business and
Not q Direct Tax on Own
ership of Property.

ership of Property
Washington. March 1s-In I'M
enrnous opinion the Supreme Court %
he United states to-day held that the
lorpo:atiou lax provisions of the Payne
Aldrich tariff act are constitutional.
Thus ended n controversy waeed almost
continually eince President waft flr.t
suggested their enactment to Congress
The 1ecision. announced by Justice
DAY. was an elaborate treatment of the
subject. containing approximately 1000
Nords. About half an hour Was spent
b. tina justice in explaining the position
n The cour, orally to the bar. the printed
opinion being used as basis for the
reWa-he.
The court holds frs. that the tax is
Just what IS claimed TO he in the act
namely. an excise tax on tho doing Of
corporate business and not a direct tax
OF he ownership Of property. Various
objections urged AGAINST the tax rs an
excise tax are disposed Of and the law is
Interpreted 50 ns % apply to real estate
companies ana tie so-cailed public service
corporations. out not tc real estate
trusts"
Practically All Of the more than s27.o0).-
bp assessed tor the fiscal year endirr
June 80, 1910, ON corporations in the Uni
TED States has been paid into the treas
ur> Tie exact amount received to FOB
,uaiy L. 1911. the latest date for which
precise figures are available, was 81.
?0s.1Sy.
TAFT ORIGINATED TIE PLAN.
The ight against the constitut,ou.li,,. of
he corporation tax began almost lnimc-
,iatcly after the enactment OF the pa>pc-
sdrlch tariff law Of 1909, OF which IL is al,
'art. During the long days of vranglina
u Congress over that measure. President
Taft originated d plan to raise part of tr,
revenue necessary for the running of the
government by imposing corporation
TAX. He is said to have made the first
tough draft of the proposed law ana to
have asked the department of justice to
perfect it.
Scarcely - years before, the Supreme
Court Of the United States had declared
unconstitutional the income tax measure
enacted by Congress In order to have u
valid taX, the errors Of that law had to he
wooded. Finally, the attention of mcm-
'crs Of the House ana senate was called
% the proposed corporation tax as It con
ittuuonal measure. 1t was urged as pro
ferahie to another income tax which, if
f.as argued probably would Doc docl.rel
unconstitutional and as undor tho CIR
:umstanccs better Legislation than au in-
-c"I'ance tax When The tulT lili was,
10" Senate, the corporation .s& pro-
q 1--we
lac Payne bill passed hy the uou-" They
remained there and became n part Of the
'aIii aet
iA' 'r,vision,o %. th" 'aw stated that tho
tax Was Special excise tax with rec
hpecl {" the CARRYING ON or doing hu-I-
ness IL Was i' l" paid - .~-' cor
Grafton lolnt 9t". llnpt"t or t-.orIa-
'"'r "r2aniz'd for profit and tsviue "a
capital stock represented bv HIrcs. and
every Insurance company. ORGANIZED UNI
Ger tho laws Of the United States or of
any state or Territory. it was provided
mat the tax should be "equivaient to one
per centum upon the entire net income
over and above 5000 received from all
fources'' exclusive Of amounts received
as dividends upon stock of other cor
poratious. Joint stock companies or asso-
Citations, or Insurance companies. subject
20 the tax.
prDc,, ,.l,>-,,,,.,.-, 49, ,-,,-,...-.
~ ''-''
Tho law provided also Ina, returns
should be made by those taxed 20 tho
treasury department to he used as a
basis for assessing the tax. These we're
apen to inspection. but I'm 1910 ronpress
enacted legislation providing that me re-