New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-01-25

Of exemptions Of certain incomes from
taxation had not come within the
meaning Of the amendment.
chief Justice White said that the
power Of the Federal government to
levy an income tax had never been
questioned. Quoting at length from
the famous income tax decisions OF
1925. he declared that the court then
recognized that taxation on income
was nm tho nature of an excise entitled
20 be enforced rs such unless and untll
II was concluded that 10 enforce u
would amount TO accomplishing the re
suit which the requirement as TO ap-
portionment Of direct taxation was
adopted TO prevent, IN which case the
duty would arise TO disregard the form
and consider the substance alone ana
hence subject the tax TO the regulation
as 10 apportionment which. otherwise
as an excise, would not apply TO II.
The court then decided, he added
that thc effect Of the tax on income
from real estate was the same as II
direct tax had been levied on the rea,
estate. and that il was with view o.
obviating such questions that the
amendment had been adopted.
Nature of Levy MOI Limited.
Inasmuch MS the amendment had not
conferred the power TO levy an income
tax. said the Chief Justice, II could not
bc Interpreted az embracing limitations
AS TO the nature and character or IN
come 10 be taxed. To consider II as
embracing limitations. such as not au
thoriz.ng a progressive tax ne helu:
was irrcconcilable with the purpose OF
the amendment. ,,,
The Chief Justice further held thai
the tax did not violate the due proc
ess" provision Of the constitution Dy
imposing a higher rate OF taxation on
incomes above $4,000 than on those
below that figure. or by other proVis-
ions.
was not Unconstitutional because II
was retroactive.
The argument that the law was IN
constitutional because labor. agricuIt-
ural and horticultural organizations
and such were exempt, the Chef jus
tico held, was answered by decisions
under the corporation tax law.
Uniformity Means Geographical.
Grouping contentious against the
law. all based on the clause of the Con
>ttution requiring uniformity IN tax
alton. Chief Justice White pronounced
them all lacking IN merit because OF
previous decisions which determined
That the clause exacted only geo
graphical uniformity.
The group included the contentious
that the tax lacked uniformity be-
cause IL
Ievies one tax on incomes al individ-
uals up 10 $4,000 and higher rate on
incomes above that amount; allows
greater exemption for married persons
than single ones, and bases the tax on
wealth alone.
Because u requires corporations al
great expense, TO perform the govern
mcnt's work. without compensation, OF
collecting at the source.
Because corporations indebted upon
coupon and registered bonds are re-
hevcd Of labor and expense involved IN
deiucting and paying the taxes OF IN
dividuals on the income derived from
bonds.
Because corporations required 70 pay
AZ the source would often pay taxes for
persons not required because Of exemp-
tions 20 pay
Because bondholders during the in
teryal between the deducting and the
paving Of the tax on their bonds are
deprived of the use Of their money
withheld.
Because bondholders Of corporations
which fail before they pay the tax
would be required TO pay the tax, al
though the corporation has deducted
the tax from the amount due the bond
holders.
Because OF double payment OF taxes
where corporations assume the pay
ment Of taxes on bonds.
Because Of the amount Of the inter
est on Indebtedness 20 be deducted
from gross income Of certain corpora
tions.
Because individuals are allowed 20
deduct from gross income dividends
paid them by corporations, but corpo-
rations are not allowed 10 make such
deductions.
Because individuals whose income is
less than $4,000 are allowed TO deduct
$4,000 or $4,000 but those receiving
more than $4,000 are not allowed to
make such deduction second time for
the additional tax.
Because greater deductions are al
lowed man and wife living together
than those living separately.
Because owners OF houses IN which
thew live are not compelled 10 estimate
the rental value in making up their in
comes, while those living in rented
houses and paying rent are not allowed
in making up their taxable income to
deduct rent.
Can Tax Differently.
"Comprehensiyely surveying all the
contentious" said Chief Justice White,
in disposing Of the complaints as to
lack of uniformity and the lack Of due
process inherent in the progressive or
additional tax on those receiving in
comes above $4,000, 1--WE cannot es-
cape the conclusion that they all rest
upon the mistaken theory that, al
though there be differences between
the subjects taxed, 20 differently tax
them transcends the limit of taxation
and amounts TO want of due process,
and that where a tax levied is be-
lieyed by one who resists its enforce
ment TO be wanting in wisdom and to
operate injustice, from the fact in the
nature Of things there arises want of