New-York tribune., 1919-07-22
Vale & Towne File Com.
plaint Alleging Withhold
ing Money From Non-Res-
idents Is Unconstitutional
Will Be Argued Thursday
Attorney General Newton to
Appeal to Judge Hand for
Dismissal of the Action

A suit designed to test the legality
or the new state income tax law in
so far as it affects citizens of New
Jersey and Connecticut and other non
residents employed here has been filed
IN the United States District Court.
Charges that the provisions of the
law dealing with nom residents are un-
constitutional are contained in the
complaint filed in behalf of the Yale
d Towne Manufacturing Company, a
connecticut corporation, with general
Offices in this city, by its counsel.
Louis Fl. Porter, F. C. Taylor and
Archibald Cox, against State Con-
troller Travis.
The object Of the suit is to prevent
state officials from compelling the
Yale & Towne Company to withhold
the tax from the salaries of non-resi-
dent employees, as provided under the
act.
The plaintiff asks the Federal courts
TO protect it from any penalties the
state may impose for refusal to make
the required deductions, which the
company alleges will cause it addi
tlonal accounting burden, with extra
expense, and lay it open to suits for
the abrogation of its contracts to pay
its employees full stipends.
Says 1t Is Unconstitutional
The suit raises the question of the
constitutionality of the act, which al
lows New Workers exemption denied
non-residents
Argument will be heard dav after
tomorrow by Judge Hand on motion
by Attorney General Newton to dismiss
the suit
The complaint says the Yale & Towne
Company, whose home office is in Siam
ford, Conn, maintains an office here
IN which large number of residents of
Connecticut and New Jersey are en-
ployed. The section of the complaint
dealing with the withholding of sala-
.ries of nonresident employees reads:
The persons residing outside of the
State of New York who are occupied in
the conduct of the company's business
either all or portion of their working
time in the State of New York. and
whose annual salaries or fixed com
pensation exceed $1,000 a year, exceed
fifty in number, and their total salary
or compensation exceeds S2OO,OOO
the State of New York to be withheld
by the company from the salaries of it's
employees residing outside of the State
of New York exceeds the sum of SO 900
per annum. The amount of expense to
which the company would be put an
nually in Withholding a percentage of
the salaries of those employees, as re
luired by the personal income tax law
would exceed $1,000"
The company alleges that the law
is unconstitutional and is in particular
contrary to and in violation of, the
guarantees of the United States Con
stitution, as follows:
at Is contrary to and in violation of
Article |, Section 8, of the Constitu-
ton, in that it interferes with and
directly burdens commerce between
the different states; is contrary to and
IN violation of Article l, Section 10,
in that it impairs the obligation of
contracts between the company and
It's employees; in violation of Section
>, Article 4, in that it deprives the
citizens of the states of New Jersey
and Connecticut Of the privileges and
immunities enjoyed by the citizens Of
the State of New York. and is in vio-
iation of the Fourteenth Amendment
20 the Constitution, in that it abridges
the privileges and immunites Of citi-
zens of the United States residing in
and citizens of Connecticut and New
Jersey, and states other than New
York, in that it deprives the com
pany and its employees of their prop
erty without due process of all law
and denies to them the equal protec-
ton of the laws"