The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1914-01-08

|
official announcement of the opinion.
Justice Pitney has completed his re-
vision of the text Of the decision in
the case involving the application OF
the corporation tax TO mining proper
ties brought by Stratton's lndepend-
ence, Ltd The decision says:
THE peculiar character Of mining
property is sufficiently obvious. Prior
to development it may present TO the
naked eye a mere tract of land with
barren surface and of no practical
value except for what may be found
beneath Then follow excavation. dis
covery, development. extraction OF
ores, resulting eventually. If the pro-
cess be thorough. In the complete ex-
haustlon of the mineral contents sc
far as they are worth removing. Theo-
retically. and according to the argu-
ment, the entire value of the mine, as
ultimately developed. existed from the
beginning Practically, however and
from the commercial standpoint tbs
value. that Is. the eXchangeable q
market value, depends upon different
considerations Beginning from little
when the existence. character and ex-
tent of the ore deposits are problem
atical It may increase steadily or rap
idly so long as discovery and develop
ment outrun depletion, and the wip
ing out of the value by the practica
exhaustion Of the mine may be de-
ferred for long term of years, While
not ignoring the importance of sucl
considerations, we do not think the.
afford the sole test for determining
the legislative intent
"As has been repeatedly remarked
the corporation tax act of 1909 wa
not intended to be and Is not In an,
proper sense an income tax law. Thi
court had decided In the Pollock cas-
that the income tax law Of 1879
amounted in effect to direct tax up
on property, and was invalid becaus
not apportioned according to popula
ton as prescribed by the constitution
,, The, act Of 1909 avoided this difficult
by imposing not an income tax, but a
excise tax upon the conduct Of bust
ness In a corporate capacity. measur
ing, however, the amount of tax b
!. the income. of the corporation, wit
+. certain qualifications prescribed b
the act itself.
= For this and other obvious reason
> we are little aided by discussion {
( theoretical distinctions between car
= ital and income. Such reflnemen
can hardly be deemed to have entere
into the legislative purpose
. course, II 1t were demonstrable TIL
}, to read the act according to its lett
t would render 1t unconstitutional,
,glaringly unequal or palpably untuc
a reasonable ground would exist f
u constituting 1t according to its spir
rather than its letter, But In our opil
> ion the act is not fairly open to crit
! cism. It Is not correct, from eth
u the theoretical or the practical stant
> point. to say that a mining corpor'
'. ton is not engaged in business, but
y merely occupied in converting its cal
ital assets from one form into anothe
The sale outright Of mining proper
y. might be fairly described as a me
49, conversion of the capital from lar
into money But when a company
digging pits, sinking shafts. TUNE
ing. drifting, stopping. drilling, blastir
and hosting ores. 1t Is employing cal
ital and labor in transmitting pa
Of the realty into personally. and pu
ting it into marketable form. TT
very process of mining is, in sens
equivalent in its results to man,
featuring process. And, however II
operation shall be described. II
transaction is individually bushes
within the fair meaning Of the act
1909; and the gains derived from It al
! properly and strictly the income fro
that business for income may be d.
fined as the gain derived from capita
!! from labor, or from both combine
and here we have combined oper:
tons Of capital and labor. AS to "
alleged inequality Of operation b.
tween mining corporations and other
it is, of course, true that the revenue
derived from the working Of min
result to some extent in the exhau
ton of the capital. But the same
true Of the earnings Of the huma
brain and hand when unaided by cal
ital, yet such earnings are common
dealt with in legislation as income.
| 80 1t may be said Of many MANI
! featuring corporations that are clear
l. subject to the act Of 1909. especial
! Of those that have to do with the pr
] duction Of patented articles; althous
/ it may be foretold from the beginnir
| that the manufacture will be profitah
/ only for a limited time, at the end
/ which the capital value Of the pla
l must be subject to material depletio
| the annual gains Of such corpor'
| tons are certainly to be taken as II
| come for the purpose Of measuring Il
| amount Of the tax"
! In dealing with the question wh
| Their many corporations are subject
/ tay the decision saws: