Source: https://supreme.justia.com/cases/federal/us/268/137/
Timestamp: 2019-04-20 16:26:27+00:00

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the residuary estate were equal in each instance. Held consistent with the due process and equal protection clauses of the Fourteenth Amendment. P. 268 U. S. 140.
2. There are too elements in the transfer of decedent's estate, exercise of the legal power to transmit at death and privilege of succession, and both may be made the basis of classification in a single state taxing statute, so that the amount of tax which a legatee shall pay may be made to depend both on the total net amount of the decedent's estate subject to the jurisdiction of the state and passing under its inheritance and testamentary laws and the amount of the legacy to which the legatee succeeds under those laws. P. 268 U. S. 144.
There is much in judicial opinion to suggest that a state may impose any condition it chooses on the privilege of taking property by will or descent, or, indeed, that it may abolish that privilege altogether, and, for this reason, that a state is untrammeled in its power to tax the privilege. See Mager v. Grima, 8 How. 490; United States v. Perkins, 163 U. S. 625; Knowlton v. Moore, 178 U. S. 41, at page 178 U. S. 55; Campbell v. California, 200 U. S. 87, at page 200 U. S. 94.
"results in such flagrant and palpable inequality between the burden imposed and the benefit received as to amount to the arbitrary taking of property without compensation -- 'to spoliation under the guise of exerting the power of taxing' -- citing Bell's Gap R. Co. v. Pennsylvania, 137 U. S. 232, 137 U. S. 237; Henderson Bridge Co. v. Henderson City, 173 U. S. 592, 173 U. S. 615; Wagner v. Baltimore, 239 U. S. 207, 239 U. S. 220."
The subject matter of an inheritance taxing statute may be either the transmission or the exercise of the legal power of transmission of property by will or descent (United States v. Perkins, 163 U. S. 625, 163 U. S. 629; Plummer v. Coler, 178 U. S. 115, 178 U. S. 125; New York Trust Co. v. Eisner, 256 U. S. 345), or it may be the legal privilege of taking property by devise or descent (Magoun v. Illinois Trust & Savings Bank, 170 U. S. 283; Knowlton v. Moore, 178 U. S. 41; Campbell v. California, 200 U. S. 87).
The taxing statute may therefore make a classification for purposes of fixing the amount or incidence of the tax, provided only that all persons subjected to such legislation within the classification are treated with equality, and provided further that the classification itself be rested upon some ground of difference having a fair and substantial relation to the object of the legislation. Magoun v. Illinois Trust & Savings Bank, supra; F. S. Royster Guano Co. v. Virginia, 253 U. S. 412.
Bell's Gap R. Co. v. Pennsylvania, 134 U. S. 232, at 134 U. S. 237.
It is not necessary that the basis of classification should be deducible from the nature of the thing classified. It is enough that the classification is reasonably founded in the "purposes and policies of taxation." Watson v. Comptroller, 254 U. S. 122. It is not open to objection unless it precludes the assumption that the classification was made in the exercise of legislative judgment and discretion. Campbell v. California, supra.

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