Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1920-08-22

with the constitution OF the state
In presenting their views, both
Mr.. Springer and Mr. Hawkins re-
ferred back to the decisions of the
Missouri supreme court in 1898
and 1899. 1t was admitted that
the section in the New Mexico con
stitutiOn was taken almost verbatim
from the Missouri constitution. 1t
Is an established rule of law that
state adopting a section of the
constitution prom another state,
which has been tested in the courts
of the state, adopts also the inter-
probation of the section. For that
reason. the Missouri cases were
of extreme Importance.
Mr.. Hawkins admitted that a
majority of the bench had con-
Cured in a decision upholding the
Missouri law. which he claimed
was not n real graduated income
tax law of the nature the New
Mexico Legislature had contem-
plated passing. He quoted from
the dissenting opinions, showing
that they classed income as prop
erty. Decisions from Pennsylvania.
from which state Missouri adopted
the section, were also quoted.
Stock Dividend Case Cited.
Professor Robert NJ. Haig. expert
for the revenue commission, asked
Mr.. Hawkins to interpret the recent
dividend case of the United States
supreme court in the light of his
argument. Mr. Hawkins contended
that 1t did not raise the question Of
distinction between property and
income. Professor Haig asserted
that this was exactly the question
it did raise.
The case was that of Macomber
VS.. Isner. Article one, section nine,
of the constitution of the United
States provides that mo capitation
or other direct tax shall be laid
unless in proportion to the census
or enumeration heretofore di-
rected to be taken.' The sixteenth
amendment to the constitution of
the United States releases income
from the above restriction in the
following words: THE congress
shall have power to lay and collect
taxes on incomes from whatever
source derived, without apportion-
ment among the several states and
without regard to any census or
enumeration"
One side in the hearing at Santa
Fe interpreted the case of Macon
Der -. Isner (the stock dividend
case) to mean that while income
taxes did not need to be levied in
a,.,,
taxes did; that the supreme court
held that a stock dividend was
property and not income and
hence not taxable under the in
come tax law. If this view is cor
rect, the supreme court has held
that income is separate from prop
erty. Accepting this view, New
Mexico could probably pass "A
graduated income tax law and not
have it conflict with article eight
of it's state constitution.
Is Income Tangible Property?
Another distinction was drawn
by Mr.. Springer between tangible
and intangible property. He held
that the new wording of article
eight had left the state free to tax
intangibles at whatever rate it de-
sired, there Is a four mill state
limit upon the taxes levied on real
and personal property. Incomes
are not mentioned, according to
Mr.. Springer, in order that they
may be taxed at any rate the leg
islature may decide.
The discussion did not entirely
clear the air. but it probably left
the revenue commission with the
feeling that a graduated income
tax might be constitutional, and
such a tax may be included In the
recommendations Of the commits
sion.