Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1916-01-27
Unanimous Decision Sweeps
Aside Every Contention Rails
cd against Law Created by
Present Administration.
MORE REVENUE IN SIGHT
Amendments Being Prepared to
Carry the Tax to Incomes Be-
low S3,O0O-Chance to Assess
Great Private Fortunes to
Help National Defense.

Washington, Jan. ei.--The income tax
was declared constitutional to-day by the
supreme court in an unanimous decision
which swept aside every contention raised
against it. and I'm the opinion of congress
sonal leaders, opened the way for in
crea sing tho tax rate ON great fortunes to
help pay for national defense.
Proposals arc pending in Congress to
tax incomes of more than 10000 as high
as ~ per cent. Leaders ON all sides agree
that out of tho impetus which the decision
To-day will give such proposals is likely
to come "A definite movement to levy on
he revenues from great private fortunes
for some of the millions tho government
must raise TO carry out tho army and
navy increases
"'Thc Supreme Courts decision has ahso-
lutely unfcttcred the income tax as a
source of revenue" said Representative
Hull of Tennessee, authorf of the
law IAN doubt is removed and
Congress is left much frccr to
act ! believe Congress will take advan-
tage of the opportunity to amend the law
materially. Without any unusual or UNI
lust charges il can be made to yield $751;
100000 to sl95. 10000 a year, as against sS5,-
o0o,oOo or s9oo0o,coo at present
Representative HUH is preparing amend
ments to carry the tax to incomes be
low $500, and make graded increases in
the surfaces on incomes exceeding 500
Oo0 year.
So far the problem OF raising the
revenue for national defense although APP
preached from many angles. has not been
carried toward any definite solution. be
cause with the constitutonaltv Of the
income tax undecided, administration
leaders were reluctant to place too much
dependence on 1t.
In It's decision the Supreme Court con-
str,ied for the first time the sixteenth
amendment to the constitution under
which the tax is levied and gave II the
broadcast Interpretation possible reiecting
suggestions to coniine its scope to narrow
limits.
The decision was announced by Chief
Justice White, and was unanimous. It
was rendered in the appeal of Frank r
Brushaher from the action of the New
York federal court in refusing 10 onjon
the Southern Pacific. Of which Brushaber
was q stoclholder, from paying the tax.
The case raised substantially every point
before the court with the exception of
the effect of the provision allowing min
ing corporations to make n five per cent.
deduction annually from gross income for
depletion of mines. This provision is re-
garded as being an amendment to the
old corporation tax rather than a feature
of the income tax.
The basic error of those who attacked
the constitutionality OF the tax. Chief
Justice White held. was in regarding the
sixteenth amendment as empowering the
United States to levy a direct tax with
out apportionment among the States ac-
cording to population. In substance, the
court held that the sixteenth amendment
had not empowered the federal govern
ment to levy a new tax. but that 1.-THE
whole purpose of the amendment was 10
relieve all income taxes from a considera
ton of the source whence the income
was derived"
Those opposing the tax had urged that
the 10Th amendment provided that income
from whatever source derived" should
be taxed without regard to apportionment
among the States.
They argued that the Underwood Sim
mons income tax provision by reason of
exemptions of court incomes from taxa
ton had not come within the meaning of
the amendment
Chief Justice White said the power of
the federal government to levy an in
come tax decision of 1890 he declared the
court then recognized the fact that taxa
ton on income was in the nature of an
excise entitled to he enforced as such UNI
less and until ii was concluded that to
enforce it would amount to accomplishing
the result which the requirement as to ap-
portionment of direct taxation was adopt
ed to prevent, in which case the duty
would arise to disregard the form and
consider the substance alone and hence
subject the tax to the regulation as to
apportionment which otherwise. as an eX-
else would not apply to it,
The court then decided. he added, that
The effect of the tax on income from
real estate was the same as If a direct
tax had been levied on the real estate.
and that ii was with view of obvatng
such questions that the amendment had
been adopted.
lnasmuCh as the amencmcnt had not
conferred the power 20 levy an income
tax, said the chief justice. it could not
he interpreted as embracing limitations
as to the nature and character OF income
TO be taxed, To consider it as embrac =
ing limitations, such as not authorizing
a progressive tax, he held. was irrecon-
cilabe with the purpose of the amend
ment, He explained, too. that the uni
formitY of excise taxes required by the
constitution was geographical uniformity
and not uniformity or application as To
classes
The chief justice further held that the
tax did not violate the due process
provision of the constitution by impos-
ing "A higher rate of taxation on incomes
above $4,000 than on those below that
figure or Ivy other provisions.
According to last years returns. there
were 35755 incomes subject to the fed
eral income tax. These included one
million dollars and more, GO; $50 900
81 ,00oo00, M; s+N,H0-S 5o0On, 60; $500, OoI-
stD,"o ~ $4,000 $500. 600, 100, $500, 900
s25o,Oa. 233; sl50. s9OOo, tO6 500, 600
$4,000, lisa