Pollock v. Farmers' Loan & Trust Co.

'v, FARMERS’ LOAN & TRUST CO. 601 Rehearing. . POLLOCK v. FARMERS’ LOAN AND TRUST COM

PANY. (Rehearing.) HYDE CONTINENTAL TRUST COMPANY. v.

(Rehearing.) THE APPEAL FROM CIRCUIT COURT OF THE UNITED STATES FOR THE SOUTHERN OF DISTRICT NEW YORK. Argued 893, 894.

Nos. May Decided 6, 7, 8, 1895. May 20, 1895. States, Hylton 171, considered, and, 3 Dali. United further view the '' cited, historical evidence shown have decided that tax the' on car- riages excise, an involved was and was therefore an indirect tax. power distributing In of taxation the Constitution to the retained States power taxation, granted absolute of direct but govern- to the Federal power ment the óf the that, same exercise, taxation condition its n apportioned among such taxes should according several States numbers; done, protect and this was order to the who were surrendering government many income, Federal so sources of taxation, principal of direct remaining their resource. duty is the simply court in this case to determine whether the income tax before it belong now does or not does to the class of direct taxes, does, and if to decide the constitutional which follows accordingly, unaffected pertaining considerations not case hand. taxes, being indisputably direct the rents Taxes on taxes on real estate equally estate are direct taxes. income of real personal personal property, or on the income of are Taxes on taxes. likewise direct inclusive, thirty-seven, imposed twenty-seven to sections pf personal 1894, of real estate act far income so falls on the Constitution, and,, meaning of the property, being a direct tax within apportioned according therefore, because unconstitutional and void sections, representation, constituting entire scheme of one all those taxation, necessarily invalid. 8fch were April, cases decided These filed a S. 429. for a U. petition Thereupon appellants the two cases: entitled follows, rehearing TERM, Behearing. Court Justices To Supreme Honorable States: United' Pollock and Lewis H. Hyde, Charles these appellants their for causes, present petition respectfully rehearing, reasons their submit should be following why prayer - granted: in involved these The cases as consti- I. of the of the' of tariff act provisions 15, tutionality August to a tax 27 1894, (sections 37,) purporting impose The court has held same are unconstitu- incomes. far as a tax the rent so tional,. impose purport estate and income of real income derived from bonds. municipal announced that it was has, however, divided in equally has as no questions, expressed opinion following in them: regard opinion the void invalidate the Whether whole act. provisions

(1) Whether, as to the income from personal (2) the act unconstitutional direct taxes. such, laying Whether of the if tax, not considered (3) any part as a for invalid want tax, uniformity. reversed The court has the decree of the Court Circuit remanded the with directions to case, enter a decree favor voluntary complainant respect payment the rents and income of the tax on defendant’s real estate and it holds in trust, and on the munic- income owned or so held it. bonds ipal the two therefore, above have

While, points stated been has there been no decision of the decided, remaining questions and no constitutionality act, regarding judgment has been announced authoritatively establishing ahy principle of the statute those v. interpretation Etting respects. Sank the United 11 Wheat. States, 59, Durant v. Essex 78; Co., 107, Wall. '7 court,

This been established having Constitution,' and its to all cases in law judicial power extending equity under the Constitution arising laws of United must be the ultimate determina- necessarily tribunal for the which, tion of these In questions. all cases such questions & TRUST CO. LOAN FARMERS’

.Rehearing. no authoritative decision therefore, can, there arise, this court. the same except in reference in its history adopted practice court early The II. to be heard constitutional if questions practicable,

requiring, in such case that the in order judgment might, full court aby of the whole court. the decision majority if possible, Pet. Bank, City v. Commonwealth In Briscoe this rule was announced 120, 122, 8 Pet. v.-Miln, New York : Justice Marshall language following Chief cases absolute of this court is, (except practice in cases where constitu- to deliver any judgment necessity) four concur in unless are involved, judges tional questions of a decision thus that. majority making opinion, do not four concur cases judges court. In the whole present which have been as to the constitutional questions opinion cases to be direct these therefore reargued The court argued. that a number larger under term, at the next expectation then be may present.” judges the next called at term of the cases were The same again court could said the not know and the'Chief Justice court, full but as term; be a court there would during whether the constitutional cases would then court was composed, to the that In a note cases Pet. upon be taken not (9 85). up the court was com- term, it is stated during page, seven; at the time the full court being of six judges, posed occasioned by resignation was then a vacancy there which;, been filled. had Duval, yet Mr. Justice fre- has been Justice Marshall Chief laid down by The rule case of made be Reference followed. may quently 119 U. S. 148. York, 129, v. New Insurance Company Ilome announced judgment Waite there Mr. Chief Justice York was affirmed of New of the State Court the Supreme Woods ill was Mr. Justice time, a divided court. At took no term, part -the whole and absent during were, There therefore, term. of the cases at that any argued (cid:127) A petition court members of the present. eight that the principle ground upon reargument was-presented be Marshall should followed, Justice announced Mr. Chief OCTOBER TERM, 1894. that the constitutional involved was sufficiently to demand a decision concurred in important majority the whole court. The 122 U. S. petition granted, 636, until was not and the case bench was full. 134 reargued This U. S. 597. as practice established in recognized Practice, at Phillips’ page submitted that no

III. case respectfully could arise more requiring the rule than application imperatively involved is precise question the constitution- present. act of an Congress citizens of the ality affecting country That act has been held unconstitutional generally. impor- tant its has not been respects; constitutionality authoritatively to the decided as These remaining portions. complainants well these serious constitutional urge, appellants should decided before their trustee finally questions expends their funds of the tax. In voluntary'payment addition, until that, is manifest some decision is reached, courts will overwhelmed these litigation questions, and collection of the tax will be most payment seriously embarrassed. tax considerable extent will

Every payer the tax pay under and sue to recover the same and if protest back, neces- out his writ of error sue to this court. The will of sary court be burdened with necessity these rearguments questions number until without settled. Still finally further, stands, now as the matter has been decided that a tax upon land is the income of unconstitutional, while the court has made no decision validity income Serious personal property. questions have, therefore, already is, fact, arisen to what be deemed the income real and what is income estate, of real and what of personal in cases where both are in the employed production of the same income.

Your therefore, petitioners, these respectfully pray be cases restored to the docket and be ordered reargument as to the which the court was divided questions evenly In case, this however, denied, should opinion. motion petitioners mandate order- your pray be amended by FARMERS’ POLLOCK v. LOAN & TRUST CO. court so that below, trial new court below

ing now determine the whether or not questions the in- (1) . in the of the statute already respects specified renders validity invalid, and whether or same not the altogether act (2) is in the not decided this court. constitutional respects by members the bar The this undersigned, honorable it is conceive court, humbly proper appeals be reheard should if this by court, herein court shall see order, fit therefore so accord- certify respectfully ingly.

Washington, April Joseph Choate, H. William D. Guthrie, A. Seward, Clarence David Willcox, Benjamin H. Bristow, Charles Steele, . counsel appellants.

Of Mr. General made the Attorney To this petition following the United States: suggestion part The United States if a respectfully that, represents rehear- in the above-entitled cases, ing granted should rehearing all the cover constitutional legal involved, questions those as to which court merely divided. equally I. Whether a tax on incomes inclusive of rents generally, and interest or dividends from investments is or kinds, not a direct tax within the of the Federal Constitu- meaning tion is a matter an which, as original question, gov- ernment never been has heard. really

Its at the was that position had argument been an of the Constitution exposition con- practically settled. — temporaneous — with its unbroken adoption subsequent — line judicial precedents concurring repeated action all the departments government —and whom the consensus all text writers authorities by has heretofore been subject considered.

II. importance the new views of government its announced taxing power, Chief Jus- opinion can tice, hardly exaggerated.

First. Pushed to their conclusion, logical they practically 1894 TEEM, OCTOBEE

Behearing. from the direct exclude of the all the real- operation power estate of the and its invested country personal property. exclude it if because, and are taxable They realty personalty the rule of the inevitable only by apportionment, inequalities from such a so of taxation are resulting plan gross flagrant resort to as to debar it. absolutely must result is That such admitted, inequalities practically that the only suggestion reply being directly not for was meant use as an personalty realty ordinary, that the United States power; was every-day expected rely for its duties, revenues customary excises; imposts, it that was meant it should direct taxes impose and as a of dernier sort resort. extraordinary emergencies - It is submitted a construction the. Constitution of such vital itself and importance its an requiring support to its framers of a which imputation specific purpose nothing text Constitution has can- reveal, any tendency not be too considered carefully before finally being adopted.

Second. minor it Though rele- consequence, certainly vant to if the that, new point out Constitu- exposition tion referred to tois the United States has under prevail, income-tax laws collected sums previous vast which money refund, every justice which it principle ought must be assumed that will deem itself bound to Congress make for provision legislation. refunding appropriate submitted.

Respectfully Olney,

Richard General. Attorney announcement following Thereupon made, 6,May In these cases made appellants The Chief appli- Justice. cation as to those which rehearing propositions upon court was divided, General equally whereupon Attorney presented if were suggestion any rehearing granted should embrace the whole case. Treating suggestion to an itself for a amounting application rehearing, to restrict the we set desiring down scope argument, FARMERS’ LOAN TRUST CO. Appellant’s Authorities. full heard before a bench, to be both to-day applications of our Jackson, brother real- presence happily anticipated further will be us to do. desired. enabled argument .No ized, to limit the number of counsel to however, ¥e were obliged, but as we await the side; two on each time, sugges- tions of counsel. were then

Five hours to each side granted argument on cases, of these motion of Mr. H. for Choate Joseph appellants.

Mr. William H. for D. Guthrie and Mr. Choate Joseph Seward, R. Bris- Mr. Clarence A. Mr. Benjamin appellants. Mr¿ Morawetz, and Mr. Willcox, Mr. David Victor tow, Charles- Steele his- brief, were their contained following torical not on the former briefs: matter, I, the Sub- Laws and States showing Colonies Early Taxation. jects of — The directed to were take New assessors Hampshire. of the land while basis;. mills, wharves, estimated as a produce and ferries were valued at of their net one-twelfth yearly in- come, 22, after Act of February 1794, deducting repairs. H. Laws of N. 1793, 471. p. — in 1643, New instructed Colony, Massachusetts. Plymouth “ the inhabitants of that accord- to rate all assessors colony lands is, or to their estates families, according goods, ing Col- abilities.” Records of faculties and personal and improved XI, ed. 42. Pulsifer’s of New ony Plymouth, its order of 1646 Company, The Massachusetts Bay 213, 173, II, Bay, of Massachusetts Records (Colonial handicraftsmen, artificers, “laborers, III, assessed 88), arts and of their advantage and for all such persons than charges the public bear more enabled help trades are brew- butchers, bakers, workmen, common laborers shoemakers, tailors, joiners, victuallers, smiths, ers, carpenters, manual other persons and masons, millers barbers, and gains returns propor- for to be rated are artists, their estates.” men, unto other tionable produce 1894. TERM, Appellants’ Authorities. law thus and was remained extended to gradually “ than forms of of manual other earnings merely persons was In “incomes 1706, artists.” imposed .the by any In trade the act 1738, or was amended faculty.” by adding the words “business The act of 1777, which employment.” constitution, the state continued levied tax on “incomes from trade or any profession, faculty, handicraft, This still remains the law, employment.” except ” “ word has been omitted since and the 1821, word faculty “handicraft” since 1849.

. All real and estates, were to be rated in 1692 “at personal, one value or income thereof.” In year’s quarter part 1693 it was all houses, warehouses, provided' tan-yards, orchards, meadows and lands, mills, cranes and pastures, be estimated seven wharves at income as years’ P., A. R. I., be let for.” M. B. 29, — Ehode Island. In the statute 1774, directed “that and assessors all rate shall consider all every who persons make their faculties shall rate them profit accord , Acts Laws of Rhode ingly.” Island, Newport, 1845 295. The rate “to take a narrow p. makers.were inspection lands and meadows judge yearly profit at their wisdom discretion.” Colonial Records of R. I., III, 300. —

Connecticut. A tax was on all faculty placed manual per artists, sons and law following Massachusetts of 1646, and were these frequently provisions repeated laws of the 1 Colonial century. seventeenth Records, 548; see, too, Laws Connecticut, 1769. published — In New York. 1743 assessors took an oath to estimate — product for shilling every pound. 1743, Oath Laws of Assessors, sec. Van 13; Schaack’s Laws, 1691-1773. — New Not Jersey. only property owners, but “also all other within this who are persons freemen and are province artificer’s or follow trade or and also merchandizing, and other innkeepers, ordinary keepers persons places within this be liable shall profit to be for province,” assessed v.: FARMERS’ LOAN TRUST CO. 609 Appellants’ Authorities. to the discretion of the the same according assessors. Laws of New Jersey, 1664-1701, 494, 1684. Jenning Spicer, pp. — The statute of March 27, 1782, Pennsylvania. provided “ other all officesand among things posts profit, trades, and professions ministers and occupations school- (excepting shall be rated at the discretion of the masters), ward township, assessors, or district and two assistant freeholders .of the proper or ward district due township, having regard profits from them.” 2 Dallas’ 8. arising Digest, — Delaware. Even after real estate 1796, was still valued rents therefrom. State according arising Papers, 439. Finance, —In a law Maryland. 1777, was which an passed imposed “ one

assessment cent on the amount one-quarter re- per ceived office or yearly by every any public person profit of an or and on the clear annuity stipend, yearly profit every or law hired clerk with- physic, every person practising acting factor, out commission, every agent manager trading in. this State.” Laws of Maryland using 1777, commerce 5-6. 22, chap. §§ — tax was In 1786, imposed upon Virginia. attorneys, 12 Hen- merchants, apothecaries. surgeons physicians, 114. Statutes, 283; 13, ning’s In the tax on five-sixths of one 1793, city property cent of or estimated the ascertained rent or in per yearly come.” Act of Stat. at 1793, Shepherd’s Va., 1792, Large, American 1806, 1, 224; Finance, State Papers, — law was South Carolina. In enacted im- a tax their on the citizens stocks posed according, estates, and of them do liabilities or make off or any profits from Two office or later this any public years employment. tax was on “their extended so as to assess individuals estates, offices and of merchandises, abilities, of stocks, places profit whatever kind or Stat. at nature soever.” Cooper Large, S. S. 183. 2, 36, - II. Oliver the Treas Woleott, Jr., Report Secretary of of Taxes, to the House

ury on Direct Decemler Representatives 1 1796. vox.. CLvm—39 TERM, 1894 Appellants’ Authorities. 1 Finance, State American (7 Papers, 414-431)

This report to a of the House resolution in obedience Bepre made 4th on the day April, report sentatives, passed ‘ is to and laying enjoined report plan The -duty says: the several taxes among by apportionment collecting the Constitution; the rule prescribed by States agreeably may as nearly objects same adapting collection, such modes appear direct taxation to be the States most respectively laws practice ” a direct each,’ $1,484,000, in recommends eligible The re thereof States. among states apportionment in addition to articles taxed States states among port follows: land as — due, on hand or horses, m,oney Cattle

Yermont. Assessments to the money. proportioned pay obligations and owners of mills, traders all according lawyers, profits judgment discretion listers or assessors or 418). (p. — hand at Stock or trade, money New Hampshire. than the owner interest and all for, more prop- interest pays estimated at its real value; mills, funds, erty public thei/r net in- at yearly wharves and part of one-t/welfth ferries come, deducting repairs. after — stock Yessels, trade, securities, Massachusetts. hand out at mterest the sum placed exceeding moneys the individual silver stock creditor; due on interest by plate, swine cattle and bank, horses, owned stockholders any 420). (p. — Polls and the collective Rhode Island. mass real and both (p. 422). personal — Stock, watches, Connecticut. clocks carriages, plate, the debts due on interest mterest credits on exceeding estimated assessments ; individual creditors apportioned and all lucrative professions, gains profits arising 423). trades and (p. occupations — fisheries, Ferries, vessels, personal New carriages, Jersey. men and slaves taxes on (p. 426). shopkeepers, single — York. Assessments towns determined .New v. FARMERS’ LOAN TRUST CO. Rehearing. Appellants’ Authorities. estimate of the

discretionary individual wealth collective of and individuals corporations (p. 425). — Prior to the time 1789, Pennsylvania. servitude of hound horses and servants, slaves, cattle, plate, carriages; all offices and ferries, posts profit,-trades, occupations with reference to their professions, Sub- respective profits. rents, ground slaves, horses, cattle, sequently trades provisions, 427, callings (pp. 428). — Delaware. Taxes been have hitherto collected of the esti- mated annual income the inhabitants of the State, reference to A statute has been specific objects. passed during that all real and year past declaring personal property shall be taxed; is made for provision stock ascertaining merchants, mechanics traders, manufacturers for the assessments purpose regulating persons, propor- tioned their rents are estimated gains profits; ground at one hundred pounds rent. Rents every eightpounds for houses and lots towns and cities, at one hundred villages twelve pounds rent reserved every pounds (p. 429). for — Taxes are Maryland. on the mass of imposed there are general, licenses for at law for admission attorneys to the bar and the £3, like sum his continuance annually during licenses to retail to'practise; tav- spirituous liquors; keep erns ; marriage (p. 430). — A tax on

Virginia. lots and houses and the ten- towns, ant or .was proprietor to disclose on oath or repaired affirma- tion the amount rent or received' them paid Toy respectively; licenses; stud ordinary horses and slaves, jackasses, ordinary licenses, billiard tables, 431, legal proceedings (pp. 432). — North Carolina. stud Slaves, horses, licensed ordinaries and houses for in small retailing spirituous liquors quantities, (cid:127) billiard legal tables proceedings, (pp. 434). — South Carolina. On £100 of stock in factor- trade, every slaves, age, faculties and employment, auction professions, sales (p. 425). —

Georgia. Stock-in-trade, funded debt of the United States, slaves, all of law professors and all factors and physic brokers, billiard tables 438). (p. TERM, Appellants’ Authorities. continues: Lands in Massachusetts and New report are taxed to thei/r according

Hampshire produce supposed or annual rent profit.”

Stock in trade or manufactures and employed loaned moneys on on interest are taxed different in different States. principles th¿ Assessments at discretion on in- supposed property come of are in un- individuals various permitted degrees der different modifications some States. In other States all taxes attach to certain defined at rates. objects prescribed

It all is assumed as of income,, principle objects whether skilled labor bear certain consisting capital, relations each other, be their defined natural value. value, The determined therefore, labor,, degree of skill and to be bestowed on the expense necessary subject (p. 437). stock

Taxes on trade manufactures employed on loaned at interest. moneys believed that direct taxes on these emer- subjects, except extraordinary temporary a/re and delusive gencies, 439). impolitic, unequal (p. Taxes on lands. Taxes to the value proportioned improved

lands, and taxes to their or actual income proportioned produce or rent a/re nearly, alike (p. 439). entirety, principle if As the Constitution has established a rule of apportionment,, there to be no appears valua- necessity that principles tion should be uniform in all the States (p. 441). In the schedule annexed to the the head of under report, taxation,” others: objects following, among — New on hand or three- Hampshire. at interest Money ¡' cent .

quarters per (p. 442). —> Massachusetts. Funded the State securities. Securities of or United ; States hand on at money (p. 437). money interest; — assessments, Connecticut. Amount at money interest; on etc. lawyers, shop-keepers, merchants, surgeons, physicians, (p. 455). — licenses Virginia. Ordinary (p. 459). — South Carolina. On faculties, &c. (p. 464).

It should bé observed discusses while the secretary POLLOCK v. FARMERS’ LOAN TRUST CO.

Rehearing. United States Authorities. much detail advantages disadvantages levying direct tax various kinds of there personal properties, is not a of doubt that- could suggestion they constitutiorially be taxed directly.

Mr. General ánd Mr. Assistant General Attorney Attorney for the United States. Whitney briefs and contained

Their argument rehearing other new matter bearing upon among things following the direct.tax particular question, income of real and relating personal property: The tax clauses Constitu I. Historical discussion. were worded the committee when left tion, style, to some standard classifi reference care and with with great difficulties. The- would solve cation which was assumed direct taxes as- follows: by classification was apportionment; and excises duties, taxes imposts by apportionment; capitation of taxes classification The capitation among by uniformity. an amend in at the last moment the direct taxes came ” “ had then no ment. The legal meaning. phrase- econo and with some It Wasborrowed from economy; political de la and Rivi mists included land taxes Mercier (Locke but taxes, 'while with others it included also capitation ere), etc. not or taxes on the .industry, (Turgot). money profits ” “ which The word duties had, however, legal signification Mr. Wilson Justice was Mr. (afterwards appealed Convention for in the Constitutional speaking Wilson) .He Debates, on Detail Elliott’s 432) evidently Committee (5 found use of the term familiar referred English in the statute c. and Blackstone Bl. Com. English (1 VIII) in*Mr. Pitt’s consolidated duties, books. These as summed up the “duties on included fund act of III.’c. Geo. 13,) (27 ” on also duties and and customs, hackney excises t]ie stamps win houses, on coaches and chairs on hawkers ; pedlars; on salaries houses; oh inhabited dows lights; pen duties, as The shown etc.. coaches, on on ; stamp sions shops; c. included Geo. III. 1765, (5 famous act 12,) stamp TERM, 1894. Rehearing. United States Authorities.

duties bonds for on securing payment money; grants on. records land; leases, or deeds conveyances, mortgages, etc. famous act 1799 levied a deeds, Pitt’s duty The incomes. tax” levied Great Britain only.“ during.that taxes was that known obsolete) century (capitation being “ “ tax.” In Britain the tax” the land Great words fact, ” “ had for a exclusive had definitions century, duty legal A settled and their use. other, each unvarying statutory at a laid all all real tax was upon upon property, a rule of valuation, and always by Every- apportionment. not was a tax this restricted sense was a duty. thing were laid duties No any.system apportionment; a rule of was an accuracy were laid by uniformity. .There in the which is consistency statutory very phraseology more as in remarkable, find. This is the rare to colloquial words used were very loosely. parlance to a there no uniform system In taxation approach uniform States. differed terminology among system and there was nowhere States; recognized in different Mr. of “duties” Wilson’s explanation definition reason reason, and for the can have referred. Eor well familiar to settled, classification was the English the distinction between the and based on American lawyers, it is and the of apportionment uniformity, system system ” used word duties Constitution believed sense. broad This consistent English entirely theoiy Insurance, Veazie Bank, Scholey Hylton, Pacific also cases. debate turned explains why Springer taxes should be how the but ap- what apportioned, not should should be duties made; what upon portionment rule but be laid whether uniformity, might be by in London coaches English duty upon local (like hackney States. or must extend the United and throughout vicinity), in a tax large noticed that It is also general property valuation, if must nation, laid necessarily appor- State by tioned, local done must be by This because valuing . by locality Each to favor his own assessor endeavors people. Each of the three systems a low great English rating. & TRUST v. FARMERS’ LOAN CO. 615 States Authorities. United “ “ tenths,” taxes fifteenths and sub- (the general and the land tax of William Mary) very quickly sidies” of a for the reachéd the stage apportionment, permanent have been that such taxes usually same reason America or an annual means of executed periodical equal- by valuations board of state officers. ization aby words “direct from

Hence, tax,” as distinguished by mind a had in tax duties, the delegates general apportioned valuation. As some of the American sys- upon property in such included all as well as land a tax, tems personalty arose doubts afterwards whether general personalty (cid:127) no direct tax. There is sufficient foundation valuation was a duties, for the whether real or any theory specific included the then term, were personal property, to be classed anal- unknown income tax remained general when it should be discovered. ogy conventions of

The state 1788 are proceedings v. Williams, evidence upon Aldridge point. competent 24; 3 How. United States v. Union 1, Railroad, Pacific Minnesota, S. Few are re 72, 79; U. 107. Taylor Taylor, at and those not The most all; fully. important part ported often 2 Elliott’s Debates, 104, of the debates is omitted. 101, also incom controversial literature that time is The these afford ; nor do literature any proceedings petent and a few evidence our Madison against theory, except others, whose own overruled theories were squarely case. Hylton and the and acts reports proceedings departmental th¿ the first decade after confirm Constitution Congress during ”

our the case. word was show duty theory They in used the broad sense specific applicable English such taxes on real and taxes personal also that there successions, sales, auction etc.; conveyances, taxation duties, 'no or direct principle forbidding Acts of March c. kind, 3, 1791, 15; times peace. c. c. 65; 1797, 11; 9, 1794, Report June July Ways Annals of Committee, 1796, 791; and Congress, p. and Means Annals of see other debates Congress 1789-98 reports TERM, 616 Rehearing. Authorities. United States to have been the member seems only prominent Madison Mr. different took a view. Convention who of the Constitutional was never doubt tames. There II. Personal property taxes or duties. were indirect ehoses action taxes on ” the famous duties as shown English were by stamp They of that and the other similar acts century, act 1765 stamp 1 See also act of 1797. States the United stamp by Debates, debated 368-9. Elliott’s pp. duties on ehoses case concerned possession.

Hylton can be collected Rentals subjected III. Rentals. actually for the the rule of 'following laid uniformity, to a duty of real tax on a class A reasons: specific specific was a windows, or as on houses laid the rule of uniformity, of the last such definitions century; under the duty legal it no to be has intended have been apportioned; tax cannot land; the valuation to either or relation quantity on landlord on the but land, tax not is a resting placed Covenants, Platt on to the land. See ex-landlord with respect v. 66 Theed 215; Case, b; 222-3, Jeffrey’s pp. Rep. Starkey, Palmer v. v. 314; 297; 8 Mod. Case Stephens, Fitzgibbon, Rensselaer v. 191; Dennison, 4 Irish C. L. Van Power, (1854) as a tax it is not a direct tax in 8 Barb. 23; economy, political Political rent on the 2 Mill’s house falls largely occupier, ed. 429-431; Economy, pp. Shifting Seligman 1796, 7 of'Taxation; Incidence Wolcott’s Report, Secretary it is than a tax, American State less direct succession Papers; and therefore within ease. Scholey cannot be done It is said that what be doné cannot directly inter- This is true when correctly undoubtedly indirectly. mean a broad that whatever cannot sense preted. taxed, cannot be because taxed indirectly, very directly direct and in- under is one between distinction consideration we of this rule, direct taxation. The correct application uni- laid under the rule of is that no tax can be it, understand in its incidence is which substantially approxi- formity actual intends as the tax the same Constitution ‘mately is no should be There levied the' rule apportionment. collected, between a tax on rents identity actually LOAN TRUST CO. FARMERS’ Opinion o£ the Court. con- If could valuation. separately land general but to to a an tax, it would analogous not. sidered, duty. occupation a tax at all. It is not on rentals a tax not, however, the It is measured by simply

measured present. by anything his income the indicated to as by ability pay taxpayer’s become rentals have moneys inextricably The year. previous funds of the other taxpayer. with the mingled the of the delivered opinion Fueler Mr. Chief Justice court. this court is pass upon validity

Whenever .the required fundamental enacted the law as tested act of by an Congress the demands its discharge the the duty imposed by people, and and deliberation sense care, deepest utmost invokes when the so And this is question especially responsibility. of-a brings the exercise governmental power, involves great decision, affected into as consideration, by vitally so sagaciously framed system complex government, “ Union, indestructible an composed secure perpetuate indestructible States.” desire to omit an anxious nothing

We with have, therefore, - tend to elucidate questions which might- any degree further able and aided arguments embodying, submitted, reexamined these (cid:127).the research, carefully fruits elaborate remain our former conclusions while cases, that, result must be acceptance enlarged unchanged, scope their their logical consequences. Chief observed

The nature of the -very Justice in one of “requires Marshall,1 judgments, greatest bjs that, its marked, its outlines should important great which minor and the objects ingredients compose designated, of the them- those the nature objects be deduced from objects we must never then, In selves.” considering question, we are it is a expounding.” Constitution forget, 4 Wheat. 407. McCulloch Maryland, divided Federal taxa- As -heretofore the Constitution stated, OCTOBER, TERM, Opinion of the Court. into two the class of classes, direct and the taxes, tion great duties, class of excises; two rules imposts, prescribed as to each class. qualified grant power to. direct taxes power lay among .The apportioned to their several States proportion representation based on branch popular Congress, representation popula- tion as ascertained was census, absolute.; plenary but to taxes was forbidden. without lay apportionment The and excises was duties, lay imposts, subject- must be uniform qualification imposition through- out United States. decision

Our was confined to consideration of previous on the income from real and on validity estate* the income from bonds. thus limited municipal direct or not, whether taxation was the meaning no Constitution; the court went farther, the on income from real to hold that it fell estate, than within the same class as the source whence the income was derived, a tax the is, and a the upon realty tax-upon were alike receipts while as to income direct; therefrom the that could bonds, not be taxed municipal because of want tax the and no source, reference was made to the nature of the tax as direct or indirect.' being

We are now to broaden the permitted field and' inquiry, to determine to which of the two classes a tax great income, entire whether derived from person’s or rents, products, of real otherwise, estate, from bonds, or other stocks, forms of and personal property, we are unable to belongs; the conclude enforced subtraction from the of all yield the owner’s real or in the manner personal property, prescribed, is so different from a. tax the it itself, direct, á but an indirect tax, the Con- meaning stitution. words the Constitution are to be taken in their ob-

vious and to have a sense, construction. reasonable In Gibbons v. Mr. Chief Ogden, Justice his with usual Marshall, felicity, “ said: As whose men, intentions concealment, no require the words which generally employ most and directly aptly v. FARMERS’ TRUST CO. LOAN. Opinion Court. intend they convey, enlightened pa express ideas and the onr who framed triots who people adopted have words their natural be understood to must employed what 9 Wheat. intended have said.” and have sense, where the Massachusetts, 188. And Island 1, Rhode two over was between States controversy whether question them was between within boundary grant judicial for the observed: Baldwin, court, Mr. Justice speaking power, of this must The solution necessarily depend and intention of words of Constitution; meaning for convention which framed proposed adoption of and in ratification to the conventions the sev people eral a reference such sources States; judi together are all courts cial information as resorted to construing resorted con this- court has statutes, always Pet. Constitution.” struing for than that know no reason otherwise We holding taxes,” hand, and “duties, “direct on the one imposts

words Constitution in the' were used excises,” other, what Nor, sense. their natural obvious arriving at. do we embrace, any ground enlarging those terms perceive their natural and within, them them or narrowing beyond, framed the time Constitution obvious at import ratified. the conclusion reached text, from tbe we

And, regard passing which surrounded the circumstances when inevitable, and the views of those its action controlled convention and the Constitution who framed and who those adopted considered. traversed; but

We do to retravel already not care ground some be added. observations may to whether non as

In the in conven the the light struggle di- to taxes or not the new Nation should be levy empowered had to re- failed on the until after the States individual rectly — did not terminate until requisitions struggle spond and Massachusetts the to that effect, by amendment proposed York, New South New concurred Carolina, Hampshire, — it seem beyond Rhode had been would Island, rejected and 1894' TERM, Opinion Behearing. Court. the reasonable direct the taxation, taking place it did of restrained réquisitions, purposely apportion- ment in order that- former according representation, as to ratio while the mode of col- system might retained, lection was changed.

This is a letter Mr. Madison of forcibly illustrated written 29, 1789, after rati January recently published,1 the. but before fication organization submission of the amend government proposed which, ment to while the amendment as Congress, opposing calculated to be exercised extraor power, impair for its ground dinary emergencies,” assigns adequate rejec tion as he State ufinecessary, since, substantially says, “every which chooses to collect its own quota may always prevent a little beforehand in collection, Federal its by keeping into its at once .finances, Federal making payment treasury.”

The reasons for the clauses of the Constitution respect direct taxation not far to seek. The States, respectively,, of taxation. could tax the possessed plenary powers They of their citizens such manner to such extent had saw unrestricted fit; they duties they impose powers or on and excises on abroad, manufact imposts imports ures, consumable commodities, They gave up otherwise. sources of revenue derived from commerce; -great they retained the concurrent excises, if power duties levying other than but excises; of them covering anything respect taxation was narrowed range power granted -over interstate- commerce, at danger being put excises, (cid:127)disadvantage dealing manufactures. They retained to that power taxation, and looked they as their chief but resource; even in of that, respect they if’the were granted power, placed by concurrent both sanie claim of the governments United subject, had did States Therefore, preference. grant of direct taxation without to their own condition regal’d 1 By Worthington April Nation, 1895; republished C. Mr. Ford in The Journal, Albany Law in 51 FARMERS’ LOAN TRUST CO. Opinion of the Court. and resources as but States; power they granted appor- to tioned as efficacious serve direct taxation, just power needs of but States- general securing government, and to the amount opportunity pay apportioned, recoup- from their feasible and har- own citizens in the most way, in the- If, with their local mony systems self-government. States, wealth and changes particular appor- population tionment it was an stipulated produced inequality inequality, however as the for, just equal representation The in the for. Constitution- small, Senate, stipulated have two members- ordains that each State shall affirmatively amendment, State shall of that and that no by body, negatively in the without its con- Senate of its deprived suffrage equal sent. The ordains affirmatively representa- Constitution the several tives and shall be direct taxes apportioned among that no direct numbers, States negatively according to the enumeration. be laid shall unless proportion of the States,, founders expenditures anticipated be met would cities, towns, their counties, chiefly while direct taxation on accumulated- they expected most, be for would that those of the Federal government And in order that the met taxes. indirect power part not be should exer direct taxation the general government when and, arose, cised, necessity necessity; except at the States to- should be so exercised as leave liberty not be so their should respective obligations, discharge exercised, toas States particular discriminatingly, unfairly of those whose vote, a mere otherwise, majority possibly constituents were any part intentionally subjected who made Those was 'made. burden, the qualified grant knew to tax involved power destroy, power in McCul Marshall, of Chief Justice that, language abuse of loch v. Maryland, only security against itself. In found the structure government its constituents. This a tax, the imposing legislature'acts erroneous is, oppres a sufficient general, security against retained this secu And sive taxation.” 4 Wheat. taxation and representation rity by providing TERM, 1894. Opinion Kehearing. of -the Court. house of should be on the

the lower same Congress adjusted measure. for whatever the reasons' the constitutional

Moreover, pro- speak in to us to are, there they visions, appear plain language. tax,on the whole income of that is not

It is said in of Constitution, but a a direct tax meaning duty, leviable whether without as and, duty, apportionment, We do not think so. Direct or indirect. taxation was not in one and the restriction blown breath, restricted winds in another. word (On 3) says Cooley Taxation,'p. “duty” ‘‘iñeans an tax indirect on the

ordinarily imposed importation, ” “ or of a broader consumption goods$ having exportation is a custom, than on or duty meaning imposed imports ” “ term also tribute impost tax, exports; signifiesany it or but is seldom to but the indirect taxes. duty, applied any an inland excise levied articles of Ap‘ duty manu impost, upon sale, facture or and also licenses to certain pursue trades.' or in certain to deal commodities.” “ In the the words Constitution, duties, >' imposts in are excises” antithesis direct taxes. put G-ouverneur in remarks in Morris his his cele recognized modifying motion, brated as did Wilson of motion approving 5 Ell. modified. Deb. 302. And Mr. Jus (Madison Papers) in his on tice Commentaries the Constitution, (§ Story, 952,) that it the view unreasonable to presume expresses ” ” “ “ duties the word “ was used as customs or equivalent ” framers since other imposts “ clauses was that No tax or shall be laid provided duty “ State;” articles that No State exported shall, consent of without the duties on lay any imposts Congress, what except absolutely imports exports, necessary ” its and he to a laws; refers letter of executing inspection Mr. Madison to Mr. Cabell, 18, 1828, September 636. 3 Madison’s effect. Writings, at useful, the risk of

In this connection may though refer to the views Hamilton and Madison as repetition, FARMERS’ LOAN TRUST Opinion of the Court.- Federalist, thrown into relief pages respect fax con act, the enactment of the again carriage briefly 171, so much 3 Dall. dwelt sider the Hylton case, argument. c. Stat. duties 373, The act June 5, 1794, laying was enacted in for the conveyance persons, carriages, then Bills were Con time 'threatened war. pending force of the United and to to increase the military gress in various directions. there was, authorize increased taxation wartimes, much a of a taxation fore, as system part The bill of the rebellion. income war passed after a on the very House twenty-ninth May, apparently Ames and Mr. short debate. Mr. Madison only spea s ob in the Annals. Mr. Madison ker on that day reported tax; as an unconstitutional and, to this taxon jected carriages l would vote it.” measure, as an unconstitutiona he against “ if at he, Mr. to be wondered Ames It said: was coming have should a different different a country, so part In who last. idea this from the spoke tax gentleman and there known; been it this tax had Massachusetts, long a tax was difficult define whether called an It was excise. himself that was not He satisfied not. had Annals, so.” 3d 730. Cong. to Mr. Jeffer- Mr. Madison wrote On the first June, 1794, “ at the Constitution,

son : struck The which tax, carriage 3 Madison’s Writ- has House of Representatives.” passed on the Senate, where, then 18. The bill went ings, “ and Annals, considered third of June, adopted,” day it received the 3d signa- and on the day following Cong. same third of June ture On day President Washington. duties snuff certain act Senate considered “an laying ” “ and further an act provisions refined making sugar; and dis- domestic duties on and foreign collecting securing for the more tilled “an act teas;” stills, wines, spirits, ” “an act Southwestern’frontier; of the effectual protection merchandise, wares and additional duties on laying goods, ” “ wines selling an on licenses for1 etc.'; act duties laying “ ” an act lay- retail.; distilled foreign spirituous liquors at duties on auction.” sold ing TEBM, OCTOBEB Opinion of the Court. then that Mr. Madison appears regarded carriage

bill as his vote unconstitutional, accordingly gave against it, was ‘to a if not although extent, war large altogether, measure.

Where did Mr. Hamilton At that stand? time he was' of the and it Secretary Treasury, may assumed, therefore without that he favored the But proof, legislation.

what He come must, have course, con- ground? clusion that it was hot a direct tax. Did he with Fisher agree his Ames, that the tax friend, was an personal political excise The evidence is that he did. overwhelming ?.

In the thirtieth number of the after Federalist, depicting condition of helpless out hopeless country growing of the confederation to obtain from States inability to its he moneys more assigned expenses, says: adversaries new Constitution admit the intelligent force of this but their admission, reasoning; they qualify distinction between what call internal and external théy taxations. The former would to the state they govern- reserve ments the ; latter, into commercial they explain imposts, or rather duties on declare articles, imported themselves to concede to the In Federal head.” willing thirty-sixth while still the division of number, his he adopting opponents, “ : The intended taxes to be under the says comprised general denomination of internal be subdivided taxes, into those the direct and those kind. indirect ... As to which must be latter, -understood duties and. exciseson articles orífeis at a can loss to what consumption, conceive, be the nature of the difficulties find Thus we apprehended.” Mr. Hamilton, while to induce of the Con- writing adoption stitution, external first,- of taxation into- dividing power and internal, into the former the putting imposing duties on articles and into latter all imported remaining second, and, the latter into and in- powers; dividing into the direct, latter, duties and excises on articles of putting consumption.

It seems to us to in follow that Mr. Hamilton’s inevitably at that time duties judgment internal taxes, except, v. FARMERS’ LOAN TRUST CO. Opinion of the Court. fell on articles of into" the excises consumption, category direct taxes. in bill,

Did he, tax his supporting carriage views change ? in in- in His case Argument Hylton respect support law enables us answer this It was not question. but Dallas, his son in published reported of all the edition Hamilton’s .writings Federalist. except shall After that we vain for seek saying any legal meaning “ terms direct and indirect respective after taxes,” if stating tax it is forcibly impossibility collecting “ as a direct be he tax, considered says, doubtingly: to be the direct taxes. following presumed Capitation -on taxes. Taxes lands and General poll buildings. assess whether the whole ments, on their individuals, whole real or all else must of estate; personal be necessity “ d indirect considere as taxes.” Duties, wq,cLexcises imposts “ to be from taxes.” If the appear contradistinguished meaning of the word exciseis to be in the British it sought statutes, will include found to which is con duty carriages, there as an sidered ^excise.” “Where so important distinction is realized, Constitution'is to fair to seek the mean of terms in the of that ing language statutory country which our is derived.” 7 Hamilton’s jurisprudence Works, Mr. therefore Hamilton law which Mr. clearly-supported Madison same reason that his friend Fisher opposed, did, Ames because it was an and as excise, such was specifically' the Constitution. loose comprehended Any expressions “ - definition of far direct,” the word so with his conflicting well-considered views must be Federalist, regarded thinks which the advocate himself entitled liberty usually to take with however, his He to us, subject. gives, appears a definition before us. tax which covers' A the question upon one’s whole income tax the annual from his receipts whole and as falls within the-same class as property, a direct tax, of' meaning ¿Hamilton the Constitution. in his And Mr. on the report credit, with citizens of a contracts public referring foreign which seems said: This country, critically correct, principle, von. clviii —40 TERM, 1894.

.626 Opinion Rehearing. of Court. the the income as the capital would as well exempt property. as the in What, fact, It the use, effectually thing. protects the beneficial use of without it? a-fiction, but is property, the is anrmity the income cases, indeed, In many Works, 3 Hamilton’s itself.” think, in in conflict the case Hylton there is nothing

We The case is badly reported. report the foregoing. the of both the before whom the names does not judges give The record of that Court. Circuit case was argued was one and District that Mr. Justice Wilson -shows court in was the other. Tucker Griffin of Virginia Judge Judge in 1803, Blackstone his edition published appendix “The 1, 294,) vol. Blackstone, p. says: part (Tucker’s case of United State,, tried in this States was divided was carried the court being opinion, v. Hylton, States consent. United Court to the Supreme it, first (the Secretary was there argued proposer States', on behalf the United Treasury,) the United behalf Justice Chief present of those was have Each supposed defendant. gentlemen That of the his own opinion. Secretary defended private and the tax was submitted afterwards Treasury prevailed, to, universally, Virginia.” Mr. Marshall informed whether

We participated and there is Bichmond, at nothing the two hearing days’ he in the case this court; to indicate appeared record Tucker was aware of the Judge but probable quite entertained in matter. he regard opinion left out of Hamilton’s report, Mr. argument turned entirely it it is said argument place his a direct while brief tax, whether tax was the point it turned he was concerned, so far as that, shows not a an and therefore direct excise, was whether point tax. tax was a tax Chase

Mr.' Justice thought commodity, was consumable because carriage expense, of the owner. the tax on it on the view and in that expense to what were an declined opinion He give expressly POLLOCK FARMERS’ LOAN TRUST CO. Opinion of the Court. Constitution. Mr. taxes Justice contemplated by “All or

Paterson said: taxes are expenses consumption kind.” indirect a tax on is of this He taxes; carriages quoted in from Adam of his Smith conclusions, copiously support made it is now asserted small although justices Iredell said: account of that writer. Mr. Justice “There is or- or no in what is a not, necessity, propriety, determining or in all It is on the direct, indirect, tax, sufficient, cases. satisfied, for to be that this is not occasion, the court present a direct tax the Constitution.” contemplated by

What in was decided case that a tax was, then, Hylton therefore, was an an indirect tax. excise, and, carriages The contention of Madison in the House was so Mr. far disturbed that the court classified it where he himself it, by and he constitutional, would have held as subsequently act. 3 Stat. 40. The conten- President similar approved tion Mr. in the Federalist not Hamilton disturbed by it in the least. In our the construction to judgment, given the authors of the the Constitution . Federalist five (the numbers contributed Chief Justice related to the Jay influence, from force and and to the danger foreign treaty- not and cannot be should making power) disregarded. tax, Constitution direct unless any prohibits propor-

tion census; to numbers as ascertained and, light of; the to we have is it not referred, circumstances which an that a evasion. of that to hold general prohibition unappor- owners as a tioned for tax, body imposed upon property direct, or is not their respect property, meaning of the confined to the income because there- Constitution, from?

Whatever the economists views political speculative revenue it be held reformers can be, properly and with sense, taken its and obvious plain formation of circumstances due'regard attending tax on authorizes government, unapportioned general rents of real products estate, the farm and and with no because although ownership imposed merely means of as to from possible belonging payment, escape TERM, 1894. Opinion the Court. bi that which includes the different class property totally % income from whence the proceeds unless the answer, one There can be but constitutional treated utterly futile, restriction is illusory defeated, ¥e find it of its framers impossible the object deemed so hold that a fundamental requisition, important two one affirmative one be enforced provisions, torced distinctions can be refined between away by negative, and the that which value to itself. gives can we the same Nor why ground reasoning perceive held does apply -capital personalty purpose incoma, income, and to income ordinarily yielding real all its All the estate country, therefrom. operation open invested personal property, made if an according apportionment taxing not that no say The Constitution does to the Constitution. on other shall be laid any tax by apportionment prop- direct the land; on all unapportioned than forbids contrary, erty know and we of no warrant for taxes; direct excepting per- the of the from exercise reason any sonal power, property direct tax cannot be' laid and assessed, as an apportioned why in his said Mr. Gallatin when report Secretary Treasury “ the same of taxation on which the in 1812, upon objects, under of the State are laid taxes levied authority and assessed.” kind is of some distribution;

Personal property general thereof incomes, the taxable and so though might range be narrowed through large exemptions. Confederation found limitation Congress of the contributions of the and “land, States

the sources thereon,” buildings improvements eighth 1778, so article was 9, article July objectionable- 1783, so that should be 28,. taxation amended April to the number' of whole white proportion apportioned those inhabitants,, free citizens and bound other including of all other for a term three-fifths years servitude Ells- Madison, Indians taxes; persons, except paying in their address, and Hamilton sending worth, amende FARMERS’ LOAN POLLOCK v. TRUST CO. Opinion of the Court. said: This rule,

ment not free although is liable fewer than other that could objections, 1 Ell. Deb. 93, 95, devised.” are we

Nor contention impressed that, because in in which the the four instances direct taxation has power did not see exercised, fit, been reasons of Congress expedi- this amounts to levy such a ency, personalty, construction of the Constitution did that. practical that we must not exist, ourselves bound regard it. We ¡should to be to hold the regret compelled powers thus restricted, cannot general government certainly accede to idea that the Constitution has become weakened under it. course inaction by particular The stress of the is thrown, however, on the argument ¡assertion that an income tax is not a tax at all; that it is not a real estate or a tax, a bond tax, tax; that it crop is an assessment account of his taxpayer money- as shown his revenue for the spending power year pre- assessment; that rents received, ceding harvested, crops have lost all connection with collected, interest their origin, once not taxable have become transmuted in although their new form into taxable in other subject-matter; words, income is taxable source from whence irrespective it is derived. Mr.

This the view entertained Pitt, expressed his celebrated his income tax law of speech introducing and he did not hesitate it to its conclu- carry logical sion. The loan acts divi- provided public English “ free all taxes and dends should be whatso- paid charges ” ever but that ; Mr. Pitt contended the dividends successfully to be of the income tax were considered purposes much relation to the as and income, so simply recipient that fund And holder had no reason to this, complain. Mr. was the after, said rational Gladstone, years fifty-five construction Statements, Financial 32. the pledge. in effect this ground dissenting justices proceeded but the court 449, Westonv. 2 Pet. Charleston, it. rejected but the true;

That a state it is States have tax, to power TERM, 1894. Opinion of the Court. and if tt>9 source is taxes, income to lay open inquiry, constitutional eluded. easily safeguards might held this case so far have unanimously that, ¥e on the bonds, law cannot receipts municipal operates it is a tax on the because be sustained, power to instrumentalities borrow and and on their conse- money, But if, contended, Constitution. quently repugnant when received has become the interest merely money and taxable as such without reference to pocket, recipient’s it came, from which is 'source immaterial it could have been taxed all or at not. originally whether admitted General This’was with character- Attorney if the that, and it candor; istic follows revenue derived from because 'bonds be taxed the source cannot municipal cannot revenue from other rule source the same be, any applies, to the hick of tax; but levy not subject tax on an real and personal equally apportioned property the revenue exists as to therefrom. this act taxes income of irre-

Admitting its cannot source, still a tax is we spective doubt a direct tax ih-the Constitution. necessarily meaning we do not understand an In incoma tax has England, than as other a direct In ever tax. Dowell’s been,regarded Taxation Taxes admitted be the History England, the evolution in that authority, leading country taxation and an ás income tax is -classified a direct invariably given, Dowell, 126. The refers 103, tax. author (1884,) a fifteenth and tenth and a income tax in grant graduated ancient many compar statutes subsequent ¿tively tax laws. 1 as income It is Dowell, that the objected these taxes acts were imposed not, scientifically speaking, at all,, taxes income there was a although partial in 1758, there income was no income tax until 'general . of 1799 Nevertheless, Pitt’s income taxes levied acts, these modern Pitt’s, Peel’s, Addington’s, Petty’s, laws,.are and, classified as direct so.far taxes; by'existing as the tax we are income that view concerned, considering is "Concurred cyclopsedists, lexicographers, FARMERS’ POLLOCK v. LOAN TRUST CO. 631 Opinion Court. economists, classification of political generally by an income tax wherever obtains. Européan governments In General v. 3 Queen Insurance Attorney Co., Cas. App. which arose under 1090, British America North act of and 31 1867, Vict. c. (30 92,) provided § could raise provincial legislatures revenue provincial within each addition province, (in purposes licenses,) Quebec direct taxation, an.-act of the legislature laying came under stamp duty and the com consideration, judicial mittee of the Privy Council, M. Jessel, R., held speaking by “ ” “ the words direct taxation had either a technical or a or, as it is meaning, general, sometimes called, popular One or the other meaning. the words must have; meaning and in to find out their trying must have we recourse meaning the usual sources of whether information, tech regarded nical words, words of art, or words used in popular language.” And their considering either as words used in the meaning sense political as words economy, used jurisprudence of the courts of it was law,” concluded that were not stamps included in the of direct category taxation, the impo sition warranted.

In General v. 10 Attorney Reed, Cas. 141, 144, Lord App. Chancellor Selbourne said, relation to the same act of Par- liament: “The whether it is'a direct or an indirect tax cannot those depend upon events which special may vary but cases; the best particular rule is to look to the general time and if at the time the ultimate payment; incidence is uncertain, as it then, to their cannot, appears lordships, this view, called direct taxation within the meaning second section of the clause of the act in ninety-second ques- tion.” In Bank Toronto v. Cas. Lambe, 575, 582, App. Council, same

Privy subject, discussing dealing a tax to be bar, much at the argument pressed strictly direct that “ had must be no hesitation in said general, it for It would rejecting deny character legal purposes. a direct tax to óf the income tax which is country, of as and is looked as a always sucn, spoken generally TERM, 1894.

Rehearing. Opinion of the Court. of the most obvious and would run kind;' counter of men on this common which is the understanding subject, to the of the clue meaning legislature.” one main time the Constitution was framed and under adopted, At of direct taxation of of the taxes were many systems from or business, incomes laid on professions, employments, “ ” offices and but if as from it were well places profit; as had then income there been no tax such as the fact law,. not be of it' would A direct tax .this, controlling importance. because, out of the be taken constitutional rule cannot tax did not at the time the rule exist was particular prescribed. Marshall said in the Dartmouth As Justice case: Chief College It is hot this case was not enough say, particular framed, in mind of the when the article convention, it was the American when is nor of adopted. people, neces and to had this case further, that, say particular sary go would have been so as to ex varied, been language suggested, or it would have made a been it, clude special exception. within the words of the must be within its rule,

case opera being unless there in'the likewise, tion literal construc something mischievous, or to the absurd, tion so obviously repugnant of the as to who instrument, those spirit expound general justify in it 4 Wheat. 518, an Constitution making exception.” and direct, therefore to be laid is Being by apportionment, if real there so? Cannot difficulty Congress, any doing exist of other num necessity .the raising thirty, forty, ber million dollars for the support government, addition revenue from and duties, excises, ap imposts, of each of the census, the basis quota portion State it thus advise which must be made, payment to assess that amount on real proceed personal prop the income of all in the and collect the State, erty persons same if the State does not the meantime assume and its pay and collect the to its own quota system amount”'according its own ? Cannot or all this, do either way respects Congress these manner taxation, and deal with each subjects act be deemed as indeed was done might expedient, of July c. 14, 1798, 75, 1 Stat. Inconveniences pos- 597? might FARMERS’ LOAN POLLOCK TRUST CO. Opinion of the Court. income tax, of an levy attend notwithstanding

sibly when its furnishes own adjusted, valuation ; receipts, listing it is denied, but that is as- apportionable hardly although so that it would as to be operate undesirable. unequally serted whether inquiry In disposition general unappor- income of real and on the can tioned personal property under the that the sustained, apparent the result of with the fundamental compliance suggestion abandonment lead of that method of would taxa- law because of tion inequalities necessarily altogether, alleged not be its could allowed to influence the pursuit, accompany but invites atten- conclusion; suggestion unnaturally that the want counsel, to the contention tion appellants’ act is such as to invalidate it. uniformity equality census are that enor- drawn given, showing Figures of mutual insurance of asso- mous assets companies; building mutual of banks; ciations ; savings large productive property of and it is claimed ecclesiastical organizations; exempted, reach so millions hundred many exemptions taxation would have been reduced of if one-half, rate perhaps made¡ not had not been We are with the act dealing of to be view; but, from that the data sub- point assuming if desired reliable, the sum to be raised had béen stantially it be whether which doubted State, any paid apportioned, its methods, and collected the amount own would, its.quota have qould under its a constitution, allowed part large better a alluded to to taxation. If so, the- escape property have been than would measure would attained -equality for the to since, otherwise according argument possible, rule is not government, equality prescribed by to taxation, as Federal and the observance Constitution' matter a inherent in is such a rule as all taxation just purely ' discretion. legislative merits of and Elaborate is made as to efficacy argument and hand, tax an income as on the one just, general, equal not that it is not other, and on elastic and certain; open make deductions and as to abuse by exemptions might it so under .in taxation equality wanting uniformity TERM, 1894 Opinion of the Court. to to amount substance without deprivation due property it not is to fraud of law and evasion ; open process in its but methods; because it is inquisitorial preeminently tax enables burden of rich, a taxes on con- of duties imports .and diminished. sumption sensibly “ the United States And is said that representative as a of an indivisible nationality, political sovereign equal other on the face of the authority globe, adequate domestic, at its com- emergencies, foreign having mand for and defence and for all offence governmental pur- all the resources would be but nation,” a poses maimed creation after all,” unless crippled possesses power tax on income real and lay .the personal property the United States without throughout apportionment. real and and the personal in- property from there an both,

come being apportionment, conceded; that such is a a tax direct tax of the Constitu- meaning been, tion has not in our and, cannot be judgment, successfully denied and we are ; invited to thus hesitate the enforce- yet ment of the mandate of the Con- prohibits on the direct tax revenue from gress laying of the citizen to state and in lines, without such man- regard ner States cannot intervene by payment regulation of their own lest resources, government delegated powers should be to be, found not less but less powerful, absolute, than the of the advocate had imagination supposed.

“Weare not here concerned whether an in- come tax be or be not nor desirable, whether such a tax would enable the to diminish taxes government on consumption duties on and to enter what be believed to imports, may abe reform Questions of its fiscal and commercial of system. that character to the of controversies belong political parties, and cannot be In our settled decision. these cases by judicial is to determine whether this tax on the province income rev- enue from does not does or the class of belong to. direct taxes. If it in does, violation is, being unapportioned, we must so declare. -—

Differences in have often court differences occurred FARMERS’ LOAN TRUST CO. POLLOCK v. Opinion of Court. — never been a timé but there has its now history

exist difference of as to its there has been opinion when duty conclusions unaffected its deliberate considera- announce to the case hand. tions pertaining should Rave been so framed be true that Constitution If it defines, kind could be the instrument laid, of this that a tax In no for its amendment. part greater the way that no without its State, consent, displayed. Except .sagacity Senate, of its the Consti- can be equal suffrage deprived concurrence tution of'two-thirds may amended-upon or conven- both and the ratification of the houses, legislatures- or Federal convention tions the several States, through of. of two-thirdb when legislatures applied The ultimate like ratification. sovereignty States,-and upon and deliberate a slow be thus called into proc- play may tO' for mere time ess, hypothesis opinion which gives and for the sober second themselves, thought every exhaust to be asserted. country part act of the -tax on considered the

We have respect from estate, from real invested income derived personal bears, on much of it have not commented so or business, privileges, employments, gains profits business, in which taxation view of instances privi- an excise tax has assumed guise employments leges, such. and been sustained as this law as sections of that so much opinion

Being is real and a tax on income from personal property lays that, of the effect to the we -are invalid, question brought conclusion, these sections as a whole. be in con statute may part is same elementary if the parts unconstitutional,

stitutional and part is constitutional that which other, each wholly independent will re which unconstitutional stand while as to is no And in us there the case before jected. of this sections act, twenty-seven thirty- validity, except been has seven, inclusive, which relate subject the rule laid down them we think discussion; under and as to Charlestown, Chief Justice Shaw Warren Gray, TERM, (cid:127)636

Rehearing. Opinion of the Court. “ that if the different are so con applicable, parts mutually nected with and each. other, as conditions, dependent for each as to other, warrant compensations considerations a belief the intended them a whole, that legislature be if carried into effect, could.not the that, all legislature would not the residue and some independently, parts pass unconstitutional, all which are thus the dependent, provisions conditional or with them.” Or, fall point connected must Greenhow, Mr. Justice Poindexter v. by Matthews put “ S.U. 304: It true that there be 270, is undoubtedly may cases where one be enforced as consti a statute part may tutional, and another be void, declared because inoperative but unconstitutional; these are where the are so cases parts that each can and where the alone, stand distinctly separable court is able to and to that intention see, declare, that was valid be should legislature part pronounced even other To enforceable, should' fail. hold though part would be otherwise for the substitute, law intended one never have been itself legislature, willing And toLenact.” as stated the same eminent again, judge in, 95, 118 U. S. it Thompson, 90, where Spraigue that certain of a section statute urged illegal exceptions but the rest could stand: might disregarded, insuperable difficulty application principle construction to the instance is, present by rejecting intended (cid:127)exceptions statute legislature Georgia is made enact what to. never meant. confessedly legislature confers statute positive operation beyond intent, what legislative one can would beyond say have enacted in view of the illegality exceptions.” the true census, of real

According valuation per- sonal in the United States in 1890 was 165,037,091,- of which real estate with thereon made improvements up $39,544,544,333. Of deducted, from the must course, latter these all applying sections, unproductive property net property whose dollars; exceed four yield does thousand even (cid:127)but, with such deductions, is evident the income formed a vital realty em- scheme for taxation part v. FARMERS’ LOAN TRUST CO. Opinion

Behearing. of the Court. If that be stricken also out, therein. income from bodied bonds, stocks, all invested investments of property, all. personal far of it is that obvious antici- kinds, by largest part would be this would eliminated, revenue leave pated tax to be borne of the professions, trades, burden employ- in that vocations; what was way intended as a ments, would remain substance tax on tax on capital occupations We cannot believe such was the and labor. of intention an, do We not mean to act Congress. laying say on real a direct tax all estate and apportionment personal or the income not also thereof, might excise' property, lay taxes on business, employments, vocations. privileges, But this is not such an and the scheme must act; be consid- ered as whole. invalid as greater Being part, held as the tax if were in a would, valid, falling, any part which could not have been direction contemplated except the taxation considered as an we entirety, connection to conclude that sections twenty-seven are constrained of the inclusive, which became a law without act, thirty-seven, on 28, 1894-, the President are of August wholly the signature void. inoperative therefore, follows: conclusions up

Our summed may, announced, that, We adhere opinion already First. direct taxes on indisputably taxes, estate being taxes real estate are of real taxes. or income equally the rents taxes on of personal We are property, Second. opinion are likewise direct income on the personal taxes. sections twenty-seven thirty-

Third. The imposed it falls so far as on the of the act inclusive, seven, a direct being estate and personal property, income real and, Constitution, therefore, tax within the meaning not because apportioned unconstitutional and void according one sections, constituting all entire those representation, (cid:127) invalid. taxation, scheme necessarily will in this court entered vacated The decrees ; hereinbefore cases and the be'reversed, remanded, the decrees below toill frayed. with instructions to ’grant relief TERM, 1894 Dissenting Opinion: Harlan, Mr. Justice Harlan dissenting.

At the former these causes it was hearing that, adjudged within on incomes meaning duty a direct tax rents on the lands from was arising rents were derived, and, must be therefore, apportioned basis of several States population, among rule of the United uniformity thoroughout the case and excises. And duties, prescribed imposts, court, of its members eight being present, equally divided whether the other provisions the statute to incomes would fall relating consequence judgment.

It is now to that however appropriate say objectionable law would have after the for been, incomes provision taxing from rents I did then, was nor I out, stricken do arising it within the now, think of the court to annul the province to incomes derived from other provisions relating specified and take sources, from the revenue the entire government to be raised the contemplated taxation of by incomes, simply the because clause to rents was held to be unconstitu- relating The for reasons view will stated in another tional. connection. the

From dissented, heretofore rendered I an- judgment entire concurrence in nouncing my the views Mr. expressed by White in Justice his able I stated at very time opinion. some conclusions reached me several general covered opinion questions majority.

In -from the and of the court dissenting opinion judgment on the for- a I alluded to present application particu- rehearing, lar discussed and stated questions majority, to be opinion filed I would dissenting subsequently express views more than I could what, then do within my fully of the' and meaning Constitution, at practice looking as well as the court, decisions of this was a government, tax to be “direct” levied only among apportioning States . their numbers. according respective section of the act of

By known 28,1894, August FARMERS’ LOAN TRUST POLLOCK CO. Harlan-, Dissenting Opinion: “An act to and entitled reduce act, taxation,

Wilson Tariff and for other revenue the government, purposes,” provide the first “That and after of Jan- from day provided: hundred and and until the first ninety-five, eighteen day uary nineteen there shall be hundred, assessed, levied, January and and income collected, paid annually upon gains, profits, in the calendar citizen of the every received preceding year by whether at home-or and abroad, United residing every said income whether therein, gains, person residing profits,'or kind of rents, be derived interest, dividends, any property^ or voca- salaries, trade, or or from employment, any profession, or from elsewhere, tion carried on in the United States on the centum amount other source a tax two whatever, per and a thousand like dollars, so derived four over above annually gains, levied, collected, shall paid and of all owned and income from every profits, on in the United States carried business, trade, profession without United States.” residing by persons ex- shall be included and what Section 28 declares what eluded and income of any estimating gains, profits, in. person. “ the shall have The Constitution Congress declares duties, excises, taxes, and collect imposts lay common defence for the gen- debts pay provide duties, eral welfare of but States; imposts the United Art. I, States.” excises shall be uniform United throughout Sec. 8. at time of its other clauses tbe to taxation

adoption, government, relating general were the following: be taxes shall apportioned

“Representatives direct be included within States which several among which shall be numbers, to Union, their according respective of free number determined persons, to the whole by adding a term ex- years, those bound for including to service other Indians three-fifths cluding taxed, persons. three actual within made after years be enumeration shall the United States, first meeting Congress TERM, 1894. Harlan, Opinion: Rehearing. Dissenting within term of ten in such manner as every, subsequent years, shall direct.” I, law Art. Sec. 2. “ No other shall direct, be laid, unless in capitation, to the census enumeration hereinbefore directed proportion 9. I, to taken.” Art. Sec. tax or shall be on

“No laid articles duty exported Art. Sec. State.” 9. I, “ The Fourteenth Amendment provides representatives shall the several States among apportioned according numbers, their respective the.whole number of counting per- sons'in each Indians not State, taxed.” excluding

It thus that the of all taxation appears primary object is to the debts and general government pay provide commun defence welfare of the United general States, and that with the of the inhibition exception taxes or on from the no duties articles restriction is in exported national terms taxation, direct imposed upon taxes except must be the several on the States basis of apportioned among numbers, Indians not duties, while (excluding taxed,) imposts and excises must be uniform the United States. throughout

What are “direct taxes” within the of the Con- meaning ? stitution In convention of Rufus asked what King and no taxation, one precise meaning answered. Madison 5 Elliott’s 451. Debates, The debates of that Papers, do not famous show that body any delegate attempted give direct, definition of succinct in his clear, what, awas opinion, tax. Indeed, those debates, report us, now before An very meagre illus- unsatisfactory. is found in the of this case Gouverneur Morris. .tration is stated that 12th of on.the he 1787, moved to July, add. clause empowering Congress vary representation- according “ of wealth and numbers of principles inhabitants,” “that taxation shall be proviso representa- proportion tion.” And he to. have occa- reported remarked, that while' sion, some motion, his he lay objections against would be removed rule to di- supposed they by restraining rect taxation.” Elliott’s Debates, on the 8th of But, August, 1787, work Committee Detail before being *. FARMERS’ LOAN & TRUST GO. 641 Opinion: Dissenting Harlan, J. Mr. Morris is convention, reported have remarked, “ let not be said that direct taxation is to be proportioned 5 Elliott’s 393. Debates, representation.” If the Rufus propounded by had question been King an- swered in accordance with the now interpretation it is given, that not at all certain its present form, would have been if adopted convention, nor, adopted, it would that have been number accepted requisite States.

A so difficult to be answered able question statesmen concerned in the lawyers directly organization can present now, seems, government, easily answered, after a reexamination of documents, and treatises on writings, all of without political economy, which, any worth exception have been several times to the noting, directly attention brought' of this court. And whenever has been done the result al until has been that a now, derived ways, duty incomes, nature, taxable whatever was held not to be a direct subjects, tax within the the Constitution, to be meaning apportioned on the the States basis of but could be population, among laid, rule to the individual uniformity, upon according citizens, and associations-without reference to numbers in corporations, citizens, States which such particular corporations, associations domiciled. Hamilton, -were the dis referring taxes, tinction between and indirect said it was a matter that terms so Uncertain in so regret vague important are to found in the Constitution,” and that point it would (cid:127)be vain to seek antecedent settled legal'meaning “for Works, terms’-’ Hamilton’s 1 respective (orig. ed.,)

This court is consider again urged of the theories advanced by economists. But light political Chief Justice this court in Chase, delivering judgment Wall. 533, 542, Veazie Bank Fenno, observed kinds of taxes enumeration of the different was Congress made with authorized to was little refer impose probably very ence to economists, there speculations political Smith, work Adam nothing great published before the convention 1787, that shortly meeting vol. CLvm —41 TERM, 1894. Harlan, Opinion:

Rehearing. Dissenting ” “ direct taxes of the words in on the meaning any light gave the Constitution. . th¿ we are com- case, therefore, From necessity very after- to look at the government practice pelled' as to the course of as well of the Constitution adoption judicial decision. c. 1 5, 1794, 45, June Stat. act of an passed By Congress, “ for the con were laid carriages duties

373, specified .by that should kept any person for veyance persons,” or for the óf hire, out to or to be let usé, conveying for his ' States, Dall. 171, The case of v. United Hylton passengers. whether .the in 1796, decidéd distinctly presented a direct tax that act was- within duties laid carriages by If it was a tax of that char the Constitution. meaning the statute was unconstitutional, it conceded that acter, was it not duties were for the reason that appor imposed on the basis numbers. As the tioned the States among each of the an constitutional casé involved question, important delivered a Justices heard the separate opinion. argument who into office on the Chief Justice was sworn Ellsworth day decision not heard the was of the announced, but, whole having declined to take It can argument, any part judgment. be doubted that he the decision; for, while scarcely approved a Senator he voted' more- Connecticut, than Congress bill once duties on and, Rufus laying carriages, Morris, Robert other statesmen, voted King, distinguished in the Senate for the act of June 5, 1794. Annals of Congress, 3d Sess., 1793-5, pp. It is to what well see Justices who delivered opinions as to the case said words direct Hylton meaning .the ” in taxés the Constitution. Chase,

Mr. said: “As was incumbent on the Justice took counsel so to error, they pains plaintiff’s great prove was a direct but did not tax; the tax carriages they if least mind. I think at doubted, satisfy my T doubted I should affirm the Circuit only judgment Court. deliberate decision national legislature consider, tax, did but (who a tax on a direct carriages POLLOCK v. LOAN TRUST CO. FARMERS’ Opinion: Harlan, Dissenting it was within the of a would description deter- thought duty) mine if the was me, doubtful, case receive the construction. But I am inclined to think that a tax on legislature. direct within is not a the letter or tax, carriages meaning the Constitution. The of the Constitution great object taxes give Congress lay the exi- adequate but were to observe two gencies government; they rules in the rule of them, when imposing namely, uniformity, they excises, laid and the duties, rule of imposts, apportion- ment when census, laid direct tax.” according “ The Constitution no taxes as evidently contemplated but taxes, such as could only lay Congress proportion census. The rule of to be apportionment adopted such cases it can where and the reasonably apply; subject taxed must ever determine the the rule. If it application is to tax article rule of proposed any specific by appor- and it tionment, would create evidently great inequality to is unreasonable that the injustice, say Constitution intended be laid thát should rule. It by to appears me that a tax on cannot be laid the rule of carriages without great inequality very injustice. apportionment two to census, For equal. suppose example, pay on dollars a tax on each, eight $80,000 carriages every there are and in one State carriages carriage; one State would other 1000. The owners carriages pay in the other. A one ten times the tax owners State dollars, but B, would for his other pay carriage eight dollars.” I think for his State, would carriage eighty pay an annual on for tax. conveyance persons may carriages to be within considered as granted Congress lay power duties. The term is the most next to comprehensive duty Britain term Great tax, (whence general, practically excises, take our of taxes, duties, we ideas imposts, general tolls for customs, etc., embraces taxes stamps, etc.) passage, not confined “I am and is only.” taxes importation a inclined to but I do not think, of this give judicial opinion, the direct taxes Constitution are contemplated tax,' or without two, wit, simply, poll only capitation TERM, Harlan, Behearing. Opinion: Dissenting or other regard property, profession, any circumstance, and a tax on land. I doubt tax, whether general assessment of personal within United States is.included within the term ‘direct tax.’” Paterson:,

Mr. Justice “What the natural and common and, or technical and of the words appropriate meaning ‘duty’ ‘ excise,’ to ascertain. no clear and easy They present will, idea to the mind. Different precise annex differ- persons ent to the terms. significations was, however, obviously the intention of the framers of the Constitution that Congress should full over possess of taxable every species prop- The term erty, except exports. ‘taxes’ is and was.' generical, cases, made use of to vest in in all Congress authority plenary of taxation. The division of taxes is into direct general indirect. term is not to be found in Although latter Indirect, the former yet it. necessarily implies to direct. opposed stands There be an indirect may, perhaps, tax on a particular article, cannot comprehended .within or description duties, excises; imposts, such case' it will be under denomina- comprised general tion of taxes; ‘tax’ is the and includes: 1. genus, term Direct taxes. 2. Duties, and excises. 3. imposts, 'All other of an classes indirect kind, and not within of the classi- fications enumerated under the heads. preceding ques- occurs, tion how is such tax to be laid, uniformly appor- is, The rule of tionately? will because it uniformity apply, an indirect and direct tax, taxes áre apportioned. What are direct taxes within the of the Constitu- meaning tion? The Constitution declares that a tax is a capitation direct both in tax, and, and land is a tax on theory practice, deemed to be a direct tax. In this the terms direct taxes way and and other capitation tax are I satisfied.” never entertained a doubt that I will not principal, only, say objects framers of Constitution contemplated within the rule of falling tax were apportionment a capitation 'and a tax on land. Local considerations and the particular circumstances and relative situation of naturally States made; lead to this view The subject. provision v. FARMERS’ LOAN & TRUST CO. Harlan, Opinion:

Rehearing. Dissenting the Southern favor of States. They possessed large had number of slaves; extensive tracts of territory, and not settled A very thinly productive. majority and slaves, had but few several of States them a limited in a settled, well and state of territory, cultivation. high if no The Southern had been provision introduced in would have been at the wholly mercy in such other States. Congress, case, at might slaves, and land in discretion of the Union arbitrarily, every part rate or after the same measureso much a head in the first much and so an acre instance, the second. To them guard in these was the against reason of imposition particulars the clause the Constitution, which directs that introducing and direct taxes shall be representatives apportioned among to their States Oh numbers. according respective in error it has been part contended plaintiff rule of be is to favored rather than the rule of apportionment and, course, that the instrument is to receive uniformity, such a construction as will extend the former and restrict the not latter. I am of that The Constitution has opinion. been an considered as it was the effect of accommodating system; mutual sacrifices and it concessions; was the work of 'com The rule of is of

promise. nature; . apportionment be cannot reason radically wrong; by. solid supported any should who are a ing. slaves, Why species more other ? The represented than there rule, fore, not to be construction. ought extended Again, numbers do rule of afford a estimate wealth. just is, indeed; uneertain very sign incompetent opulence.”- “ If a tax and uniform where the land, simple object shall what throughout we States, is scarcely practicable, say a tax and raised among, attempted apportioned a number of dissimilar pollected from, objects? will difficulty the number increase with variety things We shall be resort taxation. proposed obliged'to to intricate assessments, endless valuations bewill certain. There everything will arbitrary nothing be no rule to walk The rule of the con- by. uniformity, TERM, 1894. Opinion: Harlan, Dissenting J. and leaves will and certainty, nothing

trary, implies the case, assessor. In such and object pleasure unite, rule and and course coincide, thing sum there articles is, truth taxed in can be no imposition. another; taxed in in this be way should one State spirit and in this is tranquillity preserved; appeased, jealousy be on will the several industry equal way pressure the different relation between taxa- objects and States, an on operation tion Apportionment duly preserved. and which are assessments, valuations and involves States, case not be resorted but of neces- should arbitrary, an with- individuals, instant Uniformity operation sity. or assessments, out any regard intervention All efficacious. taxes certain, once is at easy, indirect taxes.” or consumption expenses direct must Iredell: “1. All taxes be appor- Mr. Justice (cid:127) be must uniform. duties, All excises imposts, tioned. be a direct within the of the tax, If tax meaning carriage it be If it be a must Constitution, duty, apportioned. impost, it of the must be Constitution, or within excise, meaning it can be considered as a neither direot tax, uniform. If nor Constitution, within the meaning comprehended or excise’ there is no the term impost, within ‘duty, provision one and then it must another, be way if the left such an operation power, authority been taxes without generally instances, had. lay given should be uniform; whether apportioned saying I case should the tax to be uniform, presume ought Constitution was intended to because present particularly individuals, affect cases States, except particular and this is distinction between the leading specified; . and the As articles of Confederation Constitution. present be all direct taxes must' is evident apportioned, be none as direct but such could Constitution contemplated therefore, If this cannot apportioned, is, apportioned. 'not a tax in the sense Constitution. That is evident.” “Such an arbitrary cannot apportioned is a different States method of differently suggestion taxing «. FARMERS’ & TRUST LOAN CO. Opinion: Harlan, Rehearing. Dissenting if to such new, lead, and'would altogether practised, danger- it will ous that consequences, require very powerful arguments to that that of in show method would be manner taxing any with the with at Constitution, which I compatible present it deem irreconcilable, destructive utterly altogether being the notion of of a common which the interest, upon very of the Constitution are so far as founded, the con- principles of the dition United will States admit.” “Some difficulties occur which dowe not at foresee. may a present Perhaps tax in direct the sense of the Constitution can mean nothing a but tax on to the soil; annexed some- something inseparably thing under all such capable circumstances.” apportionment “ is It the the court sufficient, occasion, for to be present on satisfied that this not a direct tax is the contemplated by in Constitution, order to affirm the present judgment; since, if it cannot be it must uniform. necessarily apportioned, I in am this is not a tax the sense clearly opinion that therefore, the Constitution, and, judgment ought be affirmed.”

Mr. Justice “As there four in- Wilson: were only judges, who this I cause, attended cluding myself, argument decision, should have thought proper join though I before on had subject, expressed judicial opinion Circuit Court of did not the the other unanimity Yirginia, from I shall now, three relieve me how- judges necessity. ever, of the constitu- add, sentiments, that favor my of the not been have tionality changed.” question, The of the case will decision scope Hylton appear from what has in later cases to which I this court- said will hereafter refer. observe,

It is that connection, appropriate case was not overlooked by importance Hylton eminent argued lawyers, day. was statesmen and we left unsaid that well assume was nothing to a full involved. necessary understanding question - Edmund with Madison Pendleton, concurring Yirginia, a tax was a direct within the mean- tax, carriages on the ing subject, prepared paper TERM, 1894. Opinion: Harlan, Dissenting Mr. then a Senator Giles, Under Virginia. it to

enclosed Madison wrote to Pendleton: 1796, I February date of into the hands of you put real pleasure paper read with a most lucid which Giles, unquestionably simple Mr. attention and well deserving view of subject, it. will determine printed which paper court tíme have the judges'to in the newspapers, benefit of find that it needed of those corrections did it. I committed to hand. It has been so liberally my you Mr. but Giles will name; your unnecessary prefix thought that, remarks, intímatíon along let an appear, that claims . . . attention quarter to.them. proceed from on which mind was more sat- was a There never my little I have' it will be very expectation isfied, yet court in the same it is me.” 2 Madi- light by viewed by on March 6, And two before 1796, 77. days son’s Writings, case Madison wrote decided, was the Hylton .Jefferson: “ has court yet on tax. judgment carriage given will be for unanimous its constitution- It is Judges said Mr. 2 Madison’s 87. Iredell, Justice his Writings, ality.” “ At this term Oliver Ellsworth took seat said: his- Diary, that came that of Justice. The first case was Chief Hylton up This was a States. as it very cause, The United v. important of constitutional law. The was the involved question point law duties 1794, constitutionality Congress laying If tax, a direct could be laid in carriages. pro- upon to- which has census, not as been taken. yet portion and The counsel contended Hylton, Campbell Ingersoll, -tax was a direct and tax, were Lee by opposed Hamilton. The court the tax and unanimously agreed ” ‘ and delivered their seriatim.’ constitutional, opinions “The before day Mr. Hamilton yesterday Again: spoke attended saw court, our the most crowded I ever audience both Houses of deserted there, being.almost Congress ill occasion. he was in with Though very health, he spoke and in a most and was manner, ability astonishing pleasing listened tb with lasted attention. His- profoundest speech car-' three hours. It about was on the whether FARMERS’ LOAN TRUST CO. 649 Opinion: Harlan; Rehearing. Dissenting one.”' 2 was a constitutional McRee’s Life tax, laid, riage 459, of Iredell, after the the acts decis Congress passed now

Turning find that the acts of' case, we 14, ion the Hylton July 1 c. 3 53; Stat. 597; 2, 1813, 37, c. Stat. 1798, 75, August 3 and c. 164; 5, 1816, 24, c. Stat. 9, 1815, 21, January March lands, 3 taxes were assessed 255, Stat. upon improve slaves, and and ments, among dwelling-houses, apportioned ¡several And the act of c. 5, 1861, 45, States. August “ An act to increased revenues Stat. entitled 294, 297, provide and interest for other debt, pur imports, pay and a direct was assessed poses,” apportioned among on lands, dwelling-houses only. States improvements, Instances of duties personal tangible. upon c. 3 Stat. 18, 1815, 22, 180, found in the act of January impos manu wares, merchandise, duties certain ing upon goods, the United or the factured or made for sale within States Territories bar thereof, iron, iron, namely, upon pig castings rolled or brads or candles of white iron, iron, nails, slit sprigs, mould umbrellas and wax, tallow, hats, candles caps, para sols, cards, saddles, bridles, books, playing visiting paper, also the act of and tobacco beer, ale, ; porter, January laid 18, 1815, 23, c. Stat. duty graduated use,” value all household furniture kept watches. silver gold the above that1 observed, statutes, passing,

(cid:127)one the administration of were all enacted during exception, him. and were Madison, by approved President Instances of duties intangible personal property . upon 1 c. Stat. 6, 1797, 11, 527, afforded Act of July by Stamp duties bonds, which, other levied stamp among things, duties had been made of Similar notes, certificates stock. Act of the British Stamp familiar to the American by people at 179; c. Statutes 1765, 5 26 3, 12, Large,. Geo. Pickering’s or to the Convention and were understood by delegates duties, in -the Con mentioned to be included 1787 among 5 Id. 432. 1 Deb. 368 ; stitution. Elliott’s in the earlier as included The reason slaves were proper acts TERM, 1894 Harlan, Opinion: Rehearing. Dissenting of court direct taxation thus explained by subjects in.Veazie above As w-ere cited: slavés Fenno, v persons, Bank . ,the described tax, aof capitation subjects proper were, the laws tax; a direct as they property Constitution as real of classed States, if. not most property, some, of , first would be view, Under the heirs. descendible under 1798, tax; of as a the tax capitation subject the taxation of-the other would be years subject latter, they taken the fram latter view was that That as realty. it is becomes when 1798, the acts after highly probable, ers of much of held, in the States slaves were where considered to land otherwise have attached would value'whieh passed with land had been valued indeed, the If, only into slaves. ’ much been heavier the land Wouldhave the.slaves, out subject in those States than States where imposition proportional on no for the of slaves; imposed there were proportion was determined without referénce each State population, The fact, to be then, which was assessed. to the subjects under from valued, to, were the act referred far. slaves as some have supposed, regarded per Congress showing, taxation under the as a of direct sonal proper object 1798, after shows regarded only Congress, 543. for the Wall. taxation, slaves, purpose realty.” be found that, the course it will Recurring legislation 1861, c. act laid above 5, 45, August Congress tax of $20,000,000 States among apportioned but it lands, improvements, pro dwellihg-houses, there should be vided that levied, collected, paid upon the annual income the United every person residing kind whether such <my income is derived from from or voca or any profession, trade, employment, on in the tion carried United elsewhere, a/ny States whatever, if the sum source such annual income exceeds on the amount hundred a tax dollars, of three centum eight' per dollars,” of such excess each hundred income above eight etc. 12 Stat. 292, statutes the area taxation. extended

Subsequent greatly the act c. 1, By July 119, duty imposed FARMERS’ -LOAN & TRUST CO.. v. 651 Opinion: Harlan, Rehearing. Dissenting J. all amount of receipts gross transportation steam railroads, vessels,

passengers boats; .on ferry or declared or dividends due money scrip paid by banks, t “ trus insurance compames, companies, annual or income of gains, évery person United profits, residing hind whether derived any States, rents, from or from interest, dividends, salaries, any profession, trade, or vocation on in carried employment, United or States source elsewhere, etc. 12 whatever,” Stat. 432, from The act of 30, 473. June c. did as 1864, 173, previous act 1862, a on from imposed duty profits, income gains, kind whatever or from whatever source derived, “rents.” 13 Stat. 281. act 223, The of March including 3, 1865, c. the amount of such 78, increased 13 duty. Stat. 479. All acts of retained the subsequent provision Congress impos on income derived from rents and from kind ing duty every Act of March c. 14 10, 1866, Stat. act 15, 5;4, of'property. 14 2, 169, March c. Stat. act 471, 477, 480; 1867, July c. 256. Stat. 14, 1870, 255, 16 has

What been- the course of decision judicial touching clause of the Constitution that relates to direct taxes ? And, of this what, was court, particularly, opinion scope v. States ? effect the decision Hylton United Ins. Co. In v. Wall. Soule, 433, 446, Pacific whether act of imposed was, presented duty June 30, as that of 13, 1866, the divi July amended by is, dends and undistributed sums, incomes, whatever of insurance was a direct tax source, companies, that could laid States. by apportionment among be. “ an income made argument point distinctly been, heretofore has is, being regarded always If be a tax, direct tax or a land tax. much so as poll direct that it tax, shall then the Constitution imperative the unanimous Mr. Justice apportioned.” delivering Swayne,- are taxes was elabo judgment court, this said what United court in Hylton rately considered this argued views . . . The decided expressed year Kent and Chancellor Justice case are adopted by [that] TERM, 1894. Opinion: Dissenting Harlan, “The of the in' their examination subject.” taxing Story most terms. The in the comprehensive given power the taxes, are: That direct including limitations imposed duties, be that tax, imposts, shall apportioned; capitation and excises shall shall be that no duties be uniform; With these State. articles any exported imposed upon unfet- is, of the in all the exercise respects, exceptions use the tax for his own If a tered: upon kept carriages, no which tax, we can see is not upon owner, ground held of an insurance can be the business tax upon company “The conse- to that class of revenue to belong charges.” the follow of tax would the which apportionment quences the Union, States and of the Territories among question. not over- the must be the manner prescribed by obvious. Where such corporations looked. are They very exist, it where none rich, numerous and light; might it not be where are few collected; it poor, could they annihila- fall them as to involve would weight cannot be of the Constitu- tion. that framers supposed that tax should be the collection intended apportioned, tion with such on that would be attended results. of which principle To the are fatal ques- consequences proposition. it consideration must be answered tion under excise; it relates is not a direct but a tax, duty on it.” was obligatory plaintiff pay 544, 546,

In Wall. Fenno, 533,543, Veazie Bank prin notes issued whether a tax on state bank cipal question bank it was a direct for circulation was tax. On behalf of a direct tax was contended counsel by distinguished that was invalid because one, among apportioned States Constitution. In agreeably explanation the author direct taxes nature relied (so largely Smith, the case Adam ized on the report states) writings econ and on other treatises, American, English political was made In discussion the case reference omy. counsel to the former v. United decisions Hylton deliver Chase; Ins. Soule. Chief Justice Co. v. Pacific have I after ing (as judgment court, observing POLLOCK v. FARMERS’ LOAN TRUST CO.

' Opinion: Harlan, Rehearing. Dissenting works economists already stated) political gave no valuable as to in the light what, constitu were direct sense, taxes, tional an examination entered of the numerous acts of taxes. That exam Congress imposing announced on behalf of this ination,'he court, showed that per and the contracts, sonal have never like, occupations, been of direct tax.” by Congress regarded proper subjects “It affirmed, therefore, that rightly practical construction the Constitution direct taxes have by Congress been limited to taxes on land and and taxes on appurtenances, taxes. And this construction is entitled polls, capitation consideration, absence great especially anything to it in the adverse discussion's convention which of. which ratified the framed and conventions Constitu of tion.” to certain observations Madison, Referring King, Ellsworth in the of he “All convention said: 1787, doubtless as to the true of the shows uncertainty meaning also, term ‘direct but it an that tax’; indicates, understanding direct taxes were such as be levied and on may by capitation, lands and valuation and assess appurtenances; or,perhaps, by ment of lists. For were personal property upon general thes.e the from which the States at that time raised subjects usually the their view received sanction of This principal supplies. this court before the of the first law enactment years tvv.o direct taxes eo nomine.” The case last referred to imposing v. States. After a careful examination of United Hylton “ the It Chief Justice Chase case, opinions proceeded: be as the assumed, therefore, unanimous judgment may safely of tax on the the that a court, Hylton carriages [in case] not a direct further be taken as established tax. And may ‘direct as taxes,’ the that the words upon Paterson, testimony used in taxes, capitation Constitution, comprehended on taxes on taxes property by and' land,, personal perhaps various descriptions valuation and assessment general follows It States. necessarily within the several possessed ot extends to tax without apportionment under the are included other Taxes on other objects. objects and must excises, heads taxes duties, imposts, direct, TERM, 1894. 654 Harlan, Opinion: Dissenting under tax rule uniformity. laid and eolleeted be well circulation, and may very bank is a on tax consideration it is in the not, of duties. Certainly head under-the be classed be said tax. a direct sense of taxation the same category come within last at the court, which this of insurance companies, incomes v. Soule, 7 Insurance Company case of term, Pacific taxi be held not to 433, Wall. .a was,' 331, 346, 347, Wall. Rew, In Scholey amended, 1864, 30, of June laid the act whether duty direct tax was a within successions 141, Stat. States. The United Constitution meaning the time when at act that the shall paid duty provided behalf, in his or his or right successor, person any or succession, his -shall become entitled possession act thereof. The of the income and the. profits receipt ’ “ £ in real should term estate further provided tenements, clude lands, hereditaments, £all corporeal de should term ‘succession’ incorporeal,’ ” ‘ estate.’ Also: title to real any devolution note. estate will, future real or “That disposition every past whereof descent, or laws deed, any person by reason entitled, shall become beneficially possession expec real the income estate, thereof, to any tancy, entitled reason of death of person any any dispo . ’” £ and that interest suc sition, successiop; any estate, to arise the sale of real under cessor moneys (cid:127) to be thereof, trust for sale shall deemed succes under this and the said act, sion duty duty chargeable the or trustee, executor, shall be other by person having paid the control of funds.” It- is also to observe that important “ tax was land in this succession made a lien the respect ” “ it and was to collected the laid, whereof same by b.e manner, in the same the as same officers, by processes direct under the of the United lands, taxes upon authority A the act on States.” was also same duty leg by imposed acies and distributive shares of personal property. seem that this involved would case was one thatt directly FARMERS’ LOAN TRUST CO.

' Harlan, Opinion: Rehearing. Dissenting ” “ direct the the words taxes the meaning Constitution. In the of that case was conceded the counsel by argument that the case Hylton opinions a taxpayer recognized tax on land tax to be taxes capitation But Constitution. counsel said: by-the “The contemplated tax- is a if one No land, was. doubt it is to be present ever the owner of the if can be land, he made to paid by it; pay but that is "true of tax that ever was or can ever be -any And if as how imposed property. prove diréctly cm. and not the is aimed owner, at, the duty e ‘ mad a lien and the land in specific charge upon respect ’ whereof it "is More than this: if assessed. as to show how

identical, was with opinion Congress, duty direct tax it had lands which levied avowedly but year or before, two enacts this succession tax out alone, of -a revenue should be collected great system, same officers,in the same the same manner, processes direct taxes lands under the United authority States.”

This Constitution was interpretation rejected by member of this Mr. court. Justice every Clifford, delivering the unanimous : court,"said judgment Support first to be drawn from that clause of objection attempted shall, the Constitution which that direct taxes provides several States which apportioned included among m'ay within Union, to their numbers; and according respective (cid:127) also clause which or no provides capitation other direct tax shall be laid unless to the cen- proportion sus or amended it is clear but that the tax enumeration; levied consideration is not act under a direct duty tax within the of either of those Instead of that meaning provisions. it is an excise authorized section plainly duty, eight of article one, which vests collect Congress lay taxes, duties, and excises debts and imposts, pay provide for the common defence and welfare. Such a tax or general is neither a tax nor duty on land exaction, sub- capitation from the section sequently appears language imposing the tax or as well as from the duty, section, preceding term denote provides ‘succession’ shall the devolution TERM, 1894. 656 Harlan, Dissenting Opinion: Rehearing. J. the tax estate; and the section which or real imposes clause, contains also corresponding ’ provides duty £ so denote entitled, term successor shall person ’ £ shall denote the testator,, the term predecessor grantor, whom the of the interest or other

ancestor, person been or be derived.” <£Whether has successor Again: shall of the in the sense comprehend any direct taxes, is a land, and tax than tax question other tax capitation it it to determine nor is necessary decided, not absolutely term it that the does as case, expressly-decided present which cannot income, the tax on distinguished not include involved in the one from a succession such"as in principle 446 Soule, Co. v. Wall. Insurance 7 controversy. the present Sickel, 14 Int. 546; 8 Wall. Clark v. Fenno, v. Bank Veazie nor as duties' excises were Neither regarded Rec. 6. Rev. of The No. Federalist, authors p. taxes by 5 Wall. Works, 847; Cases, License Hamilton’s Tax 161; ££ for the Exactions support government 462.” or excises, or duties, the form imposts, they may assume of license fees carry the form assume permission also franchises, or or enjoy special occupations particular form, when*levied upon corporations bemay specific or to the business done stock amount reference capital the individual Cooley earned by corporation. or profits * Massachusetts, 6 Provident Institution ; Lim. Const. 12 Mass. 252. Sufficient Bank v. 611; appears Apthorp, Wall. to define the employed* language suggestions prior the true out what is intent meaning pro to point the exaction is a tax make and to vision, plain if the levied, and that was land, findings rightfully entitled,-in the lan became that the show plaintiff of the court or the estate section, right acquired guage same, of the title thereof devolution income the United States.” assumed by “direct taxes” was of the words again

The meaning this court v. United of consideration Springer subject A reference to 586, 599, 600, printed 102 U. S. most will show that this in that case arguments, LOAN TRUST v. FARMERS’ CO. Opinion: Harlan, Dissenting of the member court examined, every participating thoroughly was a's to the con The the decision. question presented c. 13 172, 218, of June Stat. 30, 1864, of the act stitutionality 13 3, of March c. Stat. 1865, 78, 469, as amended the act and so far. a income levied profits, duty upon gains, from derived kind of trade, every every property, The contention of Mr. profession, Springer employment. tax not be levied was a direct that could was, such a tax the on States, same among except by apportioning cited he numer basis of In his numbers. position support of the ous all or most works them, authorities, leading among on Mr. Justice and taxation. Swayne, again political economy of this referred to court, unanimous delivering judgment to The in the convention and debates proceedings taxation, to all the acts of Federalist, imposing Congress States, and to v. United cases Hylton previous Pacific v. Rew. Fenno, Ins. v. Co. v. Veazie Bank Soule, Scholey “ other he It does not said: any Among things appear tax like the one here was ever or treated question regarded uniform as a direct tax. This construc by Congress practical tion of the so a Constitution touching important point, through so a executive long departments period, legislative conclusive, consideration' government, though one of the observations great weight.” Alluding of an case as to the evils Judges Hylton apportioned, “ tax It was well held he said: specific personal -property, of a tax, that where such evils would attend apportionment ;an Constitution could not have intended apportion ment should with even be made. This view greater applies force to Where the the tax in case. this- popula tion is it would be small, are few the incomes -large the cases above After intolerably oppressive.” examining g court: At he cited,. the entire concludes, speakin these from the cases are case in principle undistinguishable now before us, decisive plain.'iff are against exclusively error. one tax, The what is question, in American text-writers country jurisprudence. are entire Mr. Justice accord savs Story subject.

VOL. CLVIII —42 TEEM, 1894. ,J. Opinion:

Rehearing. Dissenting Harlan, — all taxes are divided into two usually classes those and those which are direct are indirect —and that ‘ the .former denomination are under included taxes on land under the and, or real taxes on latter, consumption.’ 950. Const. Chancellor Kent, Story speaking case § ‘ v. United The better Hylton says: opinion seems that the direct taxes to be contemplated two, viz., were tax and-a capitation poll ’ 1 Kent Com. See also land. Cooley, Taxation, p. 5, Law, 157, note Const. 2; 230, 9th Pomeroy, p. ed.; Sharwood’s Const. 308, note; Rawle, 30; Blackstone, Const. 305. Sergeant, not aware that since writer, W.e Hylton United has a view of decided, expressed States subject differ these that of authors. Our ent from conclusions are, that of within taxes, Constitution, direct are meaning only in that as instrument, and taxes, expressed taxes on- capitation that the tax of which and real .the' in estate, plaintiff error of an is within excise or category complains duty.” additional One cited —Clarke authority v. Sickel in 14 Int. Rev. 6, Rec. referred etc, to in the reported of this court v. Hew. It was Scholey decided opinion involved, at the circuit in That Mr. Justice Strong case of a tax on income derived from validity annuity .an the will of the husband, plaintiff’s bequeathed charged of that the record case his entire upon real (as shows) estate, The eminent who decided the case said personal. jurist : “ in all those The cases raise the whether pleadings 30, act of June c. 171, its Congress supple as a so far tax the annual ments, they impose upon gains, prof income of or the United its, every person residing States, citizen of the United or of States abroad, any residing conferred within the Constitution Con as has been true, it be If that the income tax argued, gress. other direct tax’ or within a ‘capitation meaning it is undoubtedly the first and prohibited by the first article, for it ninth is not sections ‘apportioned But I am of the States.’ a it is not opinion among direct tax’ in or other the sense in ‘capitation v. FARMERS’ LOAN TRUST CO. Opinion: Harlan, Rehearing. Dissenting framers of Constitution and people States who taxes.” understood such significance adopted this the fact is manifest when recalled that the language act of 1864 other certain provided, among things, (with collected, tax should be levied, specified exceptions) or the annual income of' annually paid gains, profits, or the United citizen every person any residing of 'the United States whether derived abroad, from residing interest, kmd any rents, dividends, salaries, from or vocation, trade, carried any profession, employment, on in the United States or elsewhere, other source whatever. Stat. 281. From and of decisions history legislation judicial — y it is manifest

That, in the of the members of this court as con- judgment stituted when case all of whom Hylton were decided:— statesmen of distinction, Wilson and' lawyers two, Pater- son, as leaders in the convention of being recognized great 1787—the taxes that could certainly regarded within direct taxes, meaning Constitution, were lands; taxes and taxes on capitation thgir

That, real estate was opinion, properly classified tax, because, words of a. Justice “a Iredell, it was tax on annexed to something inseparably “ soil,” something capable apportionment,” though, of Mr. Paterson, Justic'e even opinion apportionment vthe ” tax on land was scarcely practicable; That while the did in ease Hylton not, involve a de- terms-, cision in what was said lands, the on the respect by judges subject not, obiter because the dicta, strictly speaking, rule or that would whether a tax on car- determine principle was a direct tax whether riages would indicate necessarily tax on lands class; to that belonged

That, the the Hylton case, of all judgment judges no tax was a direct not be that could one, apportioned among the on the numbers, with some basis of approach and justice the several States equality people among who owned taxed, for the reason, property subject OCTOBER, TERM, Opinion: Harlan,

Rehearing. Dissenting that the Chase, framers of the words Mr. Justice Con- stitution to have cannot be taxation contemplated supposed “ n a rule that would' create and great by evidently inequality ” of Mr. in the words Justice would or, Paterson, injustice; or, the words Mr. “absurd and Justice inequitable;.” “ if would Iredell, lead, practised, dangerous consequences,” of a and be destructive of the notion in- common altogether of the teres Constitution are o, very principles founded;” a tax case,

That on Hylton specific judgment or let owned used taxpayer personal property, direct tax to be the States was not a hire, among apportioned numbers; the basis of on. of the until

That from the foundation government, the declarations judges Hyl- following Congress taxation to real estate and slaves, restricted case, ton never, estate has stat- in 1861 tó real exclusively, by any however its belief as- ute, personal property, .that indicated of'“direct, to be taxes” was the valued, subject .sessed States; apportioned among the above two acts 18,1815,.the

That January validity duties, never been of which has Congress by laying questioned, the numerous arti- to the rule of uniformity, upon according indicated acts, mentioned those cles personal property were, not direct on belief duties its personal the- basis of to be States taxes among- apportioned . uniform- rule of to be but were duties laid numbers, without respective population regard ity, States; in 1861 and with- imposed,

That years Congress subsequent on the basis numbers, States among out apportionment duties on income derived rule of uniformity, but by -read and income personal, including kind every from- trades, from rents, professions, employ- derived etc.; and, ments, lastly, when it has considered the occasion

That ques- upon every incomes was a direct within tion whether duty a dissent- this court without has, meaning v. FARMERS’ LOAN TRUST CO. 661 Harlan, Opinion: Rehearing. Dissenting n ing determined it in voice, on always negative, proceeding and on taxes taxes land were the ground capitation direct, taxes the framers of the Con- contemplated by stitution: have,

The I view v. United States is sus- given Hylton tained Mr. Justice statement of the Story’s grounds upon “ which the court in that case. He proceeded says: of this as stated in the various grounds decision, opinions the doubt judges, were, first, whether taxes were direct in the sense of the but and capitation land taxes, as has been that in already suggested^ secondly, cases of doubt-the rule of not to be apportionment ought favored, because was matter of itself compromise, indefensible and in- radically monstrous thirdly, wrong; if laid equality the rule tax, injustice carriage which tax of would show that no this sort apportionment, could have been as within contemplated convention, the rule of that the terms of the apportionment; fourthly, Constitution were satisfied the clause by confining respecting direct taxes to and land taxes; accu- capitation fifthly, rately taxes on are in- speaking, expenses consumption direct and a tax taxes, is of kind; and, this carriages sixthly,, (what of most and of force, itself probably cogency that no tax could be a direct decisive,) one, sense-of the Constitution, which was not ac- capable apportionment to the rule laid down in the 1 cording Constitution.” Story Const. 705, 956. §

If the above as to the summary practice government, course of decision this states what court, fairly the situation, at the time the suits now legislative judicial, before us were instituted, it not to deemed necessary, ought court has said was determining in American exclusively to ascertain what .jurisprudence,” were the views and writers and speculations European theorists in the nature of taxation respect principles which taxation nor should be as to controlled, what, economic or merely scientific and under the grounds, systems government should be deemed prevailing Europe, TERM, Opinion: Harlan,

Rehearing. Dissenting, taxes. Nor and what indirect this court taxes, ought be the circumstance that of embarrassed statesmen the by early differed as of our history principles methods period as to should national what be deemed taxation, of direet the States what to be and indirect taxes apportioned among that must be laid some- taxes, duties, excises, imposts; by of to the whole rule without uniformity country applicable of reference relative States. population particular. as Madison was of observed, already .Undoubtedly, opinion tax on was a direct tax within the that a carriages meaning should be of Constitution, apportioned among States on the basis of numbers. But this court, the Hylton, his case, Constitution, view sustained that of rejected as Hamilton, and, Madison, President, subsequently, approved taxes acts with personal Congress imposing out the same States. The taxes apportioning among in the Of which, Hamilton, opinion ought apportioned the States were not left him in doubt; for a among by draft of the Constitution him in by prepared pro that “taxes on houses, vided and" other real lands, estate, shall be taxes, each State capitation proportioned by and. the whole free Indians number not persons, except taxed, three-fifths of other Art. 4. VII, Sec. by persons.” Hamilton’s "Works,406. practice century, harmony \yith the decisions of this court, under which uncounted mill have been ions collected taxation, to be sufficient to- by ought close the door further based against inquiry, spec ulations of theorists, and the of statesmen varying opinions who in the discussions, sometimes participated very bitter, to the form of be established relating government place Articles Confederation it has under been well which, could declare and do said,'Congress everything, nothing.

But this view has not been accepted present cases, involved in them have been examined if questions as just had been not settled by long practice govern- ment, as well decisions the entire by judicial covering period since 1796 and sanction to that It seems to giving practice. court that the has not to the maxim of .me stare decisis- given LOAN v. FARMERS’ TRUST CO. Opinion: Harlan, Rehearing. Dissenting it. is entitled. While the full effect which obedience to that not maxim is enjoined expressly prin- decisions, particular resting upon interpretation ciple not be should' instrument, where lightly disregarded has been and acted accepted long upon by interpretation other branches under- government public, There lies our. American constitu- jurisprudence. many tional which were debated statesmen earnestly questions But lawyers Republic. early days having been determined court, they have judgments tp ceased be the of discussion. inWhile, subjects large sense, constitutional considered questions may finally it is certain unless settled that a settled, rightly, departure by of this court from a settled course decisions on consti- grave under which vast tutional transactions have questions, occurred, and the has been under which administered government during will shake confidence in the crises, of great public stability the law.

Since the case was decided this Hylton has country gone two Wars under based on. the through great legislation prin- of constitutional law announced ciples previously this recent court. The civil the Avar, existence involving of very to a successful the and nation, end, the brought authority of the use restored, the Union of vast amounts part, by of under statutes raised duties on incomes money imposing de- kind of real rived from and every personal, . rule of the States on apportionment among-the unequal basis of but rule of numbers, uniformity, operating individuals all the And States. we corporations — to now declare asked and the this rendered judgment day — in effect declares that the enormous sums thus taken from the used, so were taken in violation of the law people, supreme of the nation The of land. reestablished supremacy Ayas life, rebellion its but, farmed against destroy seeking so seems, wished, that that consummation, devoutly Avere effect which lives sacrificed, so valuable was at- many Constitution tended .with a of which the disregard Union was-ordained. TERM, 1894. Opinion: Harlan, Dissenting the matter of of taxation government

The policy a's of this court, as well the decisions have been its support, with the views Oliver expressed by Ellsworth, be harmony this Chief Justice of court. In became the' fore he Con of when that Convention clause necticut considering constitution giving Congress power lay proposed dutiés, excises, taxes, order to imposts, collect pay for the common defence and welfare debts provide general — the United statesman second to far-seeing and whom John none Adams Revolutionary period, to be the firmest declared administra pillar Washington’s in the Senate —said: “The is, tion first objection extends to all clause taxation.” state objects debt, lies arose us, which now from the want of heavy upon pow in the Federal Give the ers system. necessary powers the. and the Government, State will not be National necessi again, itself in involve debt for its defence war. It tated-to will the National Government lie defend all the States, to its members defend hostile attacks. The United bear the' whole will States burden of war. is necessary extend to all general should legislature taxation; should be able to objects government all the command resources no man because country; can tell what our be. Wars have now become exigencies may wars Government purse'than the sword. rather must, therefore, be able to command whole power a hostile otherwise, nation look our Constitu into purse; see what tion, resources are in the cal government, to a little culate thus obtain go beyond us; a decided they may . over us, to reduce us the utmost distress A superiority which can but command half is like its resources government but man with one arm to a defend himself.” Flanderfc’ Chief 2d Justices, 150, Series.

Let us examine which decision of the grounds rests, and look at some that majority consequences from result now I have a may principles announced. which abiding conviction, deep, my sense of compels duty me to it is not have express, this court possible FARMERS’ LOAN v. TRUST CO. 665 Harlan, Dissenting Opinion:

'Kehearing. more to be than the one regretted any rendered judgment rendered. just be the settled construction it to Constitu-

Assuming cannot tax eo lands, nomine, government tion general the tax the States among by apportioning according except does it follow that a numbers, tax on in- to their respective is a from rents direct tax on the real estate from derived comes n ? rents arise such a tax on income derived from In real judgment my property and until now never be, been, not has regarded by ought as tax on within court a direct sueh the mean- property any As mass of of the Constitution. lands in most great ing. rents, States do incomes bring any no.t a tax cannot the different States, rents vary possibly on the basis States be among merely apportioned with tax- numbers right any approach equality among or than a other more any carriages payers, personal could be so view of former And, apportioned. property with the case and Hylton beginning adjudications, ending a decision now case, tax on income Springer laid from real and collected can by appor- ~ on the basis same of numbers, tioning among revolution, regarded judicial may, improperly, of hate distrust sow the seeds among people of different of our common sections country. relied that a tax on authorities prove principal on the which such rents are

rents is direct tax lands from States decisions this court that the derived, holding burden the exercise cannot, indirectly, directly any form, Constitut committed Congress powers the national ion,1 and those which hold that government burden the cannot, directly indirectly, agencies form, 1 Charleston, Maryland, Brown v. 419, 444; 2 v. Pet. Weston 12 Wheat. 435; Almy 449; Commissioners, California, County v. Dobbins v. Pet. Erie 16 Jackson, 262; 169; Company 24 Cook How. 7 Wall. Railroad v. v. Pennsylvania, Steamship Pennsylvania, 566; Philadelphia Co. v. U. & Southern S. Mobile, Telegraph 326; ; Leloup 640 Postal 122 U. Cable Co. v. S. U. S. Adams, 155 U. S. 688. 1894. TERM, 666 Opinion: Rehearing. Dissenting Harlan, J.

or instrumentalities the States in employed exercise of by their No one of the cases of either class powers.1 involved ” as to what were direct taxes within the any mean question of the Constitution. in were it ing cases which was They held that the in could not be governmental power burdened or at all or in or in impaired mode, any directly to do so. directly, government by attempted Every one must concede that those cases would been decided have were if decided, there no were just whatever provision Constitution to direct taxes or to taxation relating other mode. All ih any t'he property country, except and the of. the property agencies States, instrumentalities taxed, some the national may form, by government order to the debts and for the common pay defence provide welfare of the United States; some, direct general taxation States apportioned basis among other numbers; kinds, duties, under excises, imposts, the rule of uniformity applicable United States throughout to individuals and without reference to corporations, popu lation State. Decisions, therefore, which hold State can neither nor obstruct the directly execu indirectly tion of the general government committed powers nor burden taxation it, of the property agencies States, United decisions that' the United States can neither nor nor burden directly indirectly tax nor State, interfere with the agencies governmental do even to establish not tend powers belonging that a which, its indirect duty proposition operation, or the use affect value may property, particular a direct within meaning Constitution.

In tax on whether a income from rents is a determining within the tax, meaning inquiry whether some affect land way indirectly or the land but whether is a on the owner, direct tax thing Day, 113; Co., Collector v. Wall. v. 17 Wall. States Railroad United 322, 332; 151, 178; Tennessee, Van Brocklin v. 117 U. S. Bank v. Mercantile York, New 121 U. S. FARMERS’ LOAN TRUST CO. 667 Opinion: Harlan, Dissenting

Rehearing. The circumstance that taxed, land. such a tax may possi- diminish the have the effect to value of the of use the land bly decisive of the nor is neither While a tax important. at a itself, on the land whether fixed rate to all applicable lands without their or the acre or value, accord- regard by value, to their market be deemed a direct ing might within the of the Constitution as meaning interpreted a. case, oh rents is a distinct Hylton duty duty something out from, the land. entirely separate of, although issuing At the were of this cause we referred on original hearing “ this the statement Coke the effect that if a point man seized of land in fee his deed to another the granteth of those and to hold to him to have and his profits lands, and maketh secundum the whole heirs, chartce, livery formam land itself doth For what is the land but the pass. profits for thereof; vesture, mines, all what trees, thereby herbage, of that land doth Co. 45. soever, Lit. 1 parcel pass.” (4 b.) Har. & But. ed. 1.§

Of a without limitation course, as to time, to a grant, par ticular and his of the of heirs, certain person profits lands,' would be construed seizin, accompanied by livery passing lands unless a different themselves, were interpretation the. In some statute. this connection Jarman on required by is cited in 5th ed. 1, Wills (Vol. support 798*) general that a devise of the rents and or of the proposition profits income of lands the land itself both at law passes equity. “ But the after this And editor, adds: since using language, act 1 Vict. c. 26 a such a devise carries fee but simple; before that act no for life it carried more an estate unless than words inheritance were added? authorities Among cited of the incomes editor, reference to devises lands, are 1 Sim. 536, 540, v. (N.. S.) Humphrey Humphrey, and Mannox 462. In the v. L. 14 first Greener, 456, R. Eq. of those unlimited cases, the court held “an tbe gift ” “ income of a fund in the other, that passed capital; gift income of unrestricted, land, simply gift the fee v. So, land.” Fox 17 Wend. simple Phelps, 393, Justice court, said: An Bronson, speaking TERM,

668 ,T. Opinion: Harlan, Dissenting rents unlimited' disposition income profits of an sometimes the estate estate will itself. carry v. Der Kerry v. rick, 104; Cro. Jac. Phillips Chamberlaine, Ves. 51. In v. 2 P. Wms. 194, Newland a devise of Shepard, the produce the estate to certain and interest for a grandchildren limited itself. was held estate But pass period authority denied of this case was Lord Hardwicke in Fonereau v. 3 Atk. 315. The rule Fonereau, cannot as in where, apply the rents and case, profits limited only given for Earl Grim, Johns. Ch. 494.” But who will period. say of rent that a devise already due, profits earned, already the land a devise of itself ? Or who would that a devise say or income of rents, land for profits, any period expressly would the fee or the limited, pass of the land itself? ownership under The statute examination in these causes its expires by at the end of own terms five It an years. annual tax imposes on the income lands received the It does preceding year.- touch the not lands nor themselves, interfere with their sale at the of the owner. It pleasure does not to lands from apply which ho rent is derived. no lien the gives lands to secure laid on payment rents that duty accrue may the landlord from them. It does not to rents due apply and contract, not by but payable collected, to such as only But a by whether taxpayer. devise, received grant or without limitation or restriction, time, .with or of rents the income of land the land profits -passes is immaterial itself, wholly causes. We aré present g , here with to. taxation for questions relating public dealin purposes of income from rents, not with any question to the of title, deed or real passing by will, estate from which such rents arise. may

It has been well observed., on behalf of the government, that rents have in common with land; nothing taking of land is wrongful possession while the trespass, taking rent under some may, circumstances, stealing; -.be land to the heir while goes rent-money goes per- sonal one representative; has a fixed that of the other situs; be determined may owner; but is law, that of the by generally EARMERS’ LOAN & TRUST CO. Harlan, Opinion: Dissenting can be taxed is taxed, one only, by sovereignty the other be which it while taxed, lies, may within and can under whose taxed only, sovereignty dominion by land- that a tax on is lien a on is; generally owner land, almost on not; personalty universally while that, and rents lands from land nature, in their have not arising a in common. A tax on land attribute reaches the land single rented or whether it is not. The itself, citizen’s residence land he tax, be reached a derives no rent although But it. rents will not reach him, duty unless he his rents residence to some one else and receives the rent. A tax with that a landlord money respect receives for him, rent is because it relates to his personal revenue from — and does source, not, sense unless it designated any — statute rest otherwise land. The provided by tax was laid without reference to the land of the tax- of rent is ; for contract, payer subject amount the intrinsic valué always regulated source from In its which the rent arises. it essence is a with reference to income only received.

But the its court, rendered, judgment just far in goes advance not its former but of decisions, decis- ion heretofore rendered an American court. Adhering to what was heretofore cases in these adjudged respect income taxation of from real estate, now arising the same on which adjudges, grounds proceeds reference to real estate the derived income therefrom, “ that a tax on or on the or personal property,” yield income or on held for the personal capital property, personalty of income or and on purpose ordinarily income, yielding “ income onor therefrom, income from invested personal stocks, investments a bonds, kinds,” of all direct tax within which Constitution, cannot meaning be it imposed unless be by Congress apportioned among States on the basis of population.

I cannot assent view that visible tangible personal is not to a national tax under the rule of uni- property subject whether such means formity, uni- uniformity only territorial TERM, 1894. Opinion: Harlan, Dissenting right among taxpayers same formity, equality When direct taxes are restricted to class. capitation taxes in either on is limited land, taxation,- form, taxes to sub- found wherever found, which population jects always consumed or be destroyed. cannot They subjects be the assessor, can seen and and have inspected by always immediate connection with the and its soil country throughout limits. Not so with In its entire personal Veazie property. Bank v. above said that Fenno, cited, was personal property had never been as to “direct regarded Congress subject taxes,” that, was said of some although opinión at statesmen the time of the adoption Constitution, ” direct included such as be levied “perhaps taxes might valuation assessment of personal property upon general as lists,” Hamilton in or, his expressed by argument case, assessments, on whether Hylton “general whole their individuals, real or whole personal estate.” 7 Hamilton’s Works, now statute before no us makes for taxation provision personal property valuation and assessment lists. upon general — In the casethis court I Hylton as think, proceeding, a sound interpretation accordance — evidence of historical held great cogency unanimously that an act for con duty imposing specific carriages was a valid exercise of the veyance persons lay and collect duties, from direot taxes. The distinguished the court now sustain the taken Madi majority.of position insisted that such son,' who was a tax within duty direct of the Constitution. So much not meaning have pains would out his been taken view of taxes, bring unless to court’s indicate this them, approval con notwithstanding of the-Constitution had been trary interpretation announced and acted one nearly hundred must years. therefore, court, assumed, now constituted, would like unconstitutional that of adjudge act only any duties on specific laying without carriages apportioning the same the States, but acts similar to those of among duties, laying rule of according uniformity, upon LOAN & FARMERS’, TRUST CO. 671 Opinion:

Rehearing. Dissenting Harlan, J. owned or manufactured personal property specific this country. — In of the my judgment say nothing disregard Eormer and of the court, settled adjudications practice — this decision Avellexcite the government may gravest It strikes at the foundations of apprehensions. very national in that it denies to the authority, general government - is, which vital to the become, may existence and very pres- ervation the Union in a national such as that emergency, of war with a commercial great nation, the collec- during tion of all duties will cease or be upon imports materially diminished. It tends to reestablish that condition of helpless- ness which found itself Congress during period Articles of Confederation, when was without authority by laws individuals, operating directly upon lay collect, its own taxes sufficient to through agents, debts and pay but was expenses defray government, all dependent, matters, such will of the upon good their- made promptness meeting requisitions them Congress. do I the decision rendered

Why just say impairs menaces the national reason is so authority? apparent - that it need be stated. In its only practical this de- operation cision from national taxation withdraAvs all incomes derived from real but estate, tangible personal in- property, vested bonds, stocks, personal investments of all property, kinds,” the income that be derived from such prop- This- results from the fact that erty. decision all court, such incomes from real personal property estate and personal national placed beyond taxation otherwise than the States' by apportionment among on the basis such No simply population. apportionment can be made without possibly doing gross injustice for the benefit of few in the favored many States. particular Any attempt upon part Congress apportion among the States, the basis of their taxation population, simply tend would personal or of arouse incomes, that it the freemen of America would indignation never among TERM, 1894. 67a Opinion: Harlan, Dissenting this therefore, court When, be itas does repeated. adjudges, cannot now or tax adjudge, Congress impose duty upon or incomé either of from rents personal property, arising estate or from real invested personal property, including per- and bonds, stocks, investments kinds, sonal of all property, to be the sum so raised except by among apportioning that, States decides according practically population, .without an amendment of Constitution —two-thirds of both three-fourths of Houses of and con- Congress incomes can and never made to be curring —such contribute -the national of government. tq support But decision this is all. The now made not may provoke which contest in this from would country American people had have been if the court not overturned its former spared had adhered of taxation adjudications, principles under which our government, following repeated adjudi- - of has been court, cations this administered. always Thought- ful, conservative men have held that the uniformly government not be could administered safely except upon right, principles discrimination justice, equality against any part —without because of their or-not visible people owning owning or because of their or not incomes property, having having But, from bonds and stocks. its construction present the first court, Constitution time in all its de- history, clares our has been so framed that, matters government of taxation for its and maintenance those who have support incomes from the derived real estate or from the renting or or personal who own leasing using tangible invested bonds, stocks investments of personal property, Avhatever have be kind, cannot accorded-to those privileges derived from the labor incomes of their or the having hands, ex- ercise of or of their their the use skill, brains. Let -meillustrate this. In the cities or financial centres of the large country there are enormous incomes from persons deriving the'renting erected, houses that have been to be occupied by owner, but for the sole rented. Near are purpose being other trusts, combinations, persons, corporations, possess- vast ing bonds quantities personal property, including v. FARMERS’ LOAN TRUST CO. 673 Opinion: Harlan,

Rehearing. Dissenting of railroad, telephone, stocks telegraph, mining, banking, coal,' oil, sugar-refining*corporations, millions gas, millions income derived. In the regularly same own neither are others who real nor in- estate, neighborhood nor nor bonds, vested stocks of personal property, any kind, entire arises from the and whose income skill and industry them trades, displayed by particular callings, professions, use from the labor of their or the of their brains. hands, that under declared, And now law, day however needs of the Gov- urgent may the administration in however ernment, sorely power may n pressed nation, meet 'the Con- moneyed obligations of the nor cannot tax the the country,- personal property gress or from real invested income either from estate arising per- the a tax sonal among except by apportioned property, the on the basis of their while mer- compel population, author, the the artist, the the chant, artisan, workman, the of the minister no the even the one lawyer, Gospel, physician, real invested estate,, of whom to own personal happens prop- or from their stocks re- bonds, directly erty, to^contribute and under the rule of gains, profits, spective earnings, of the the support government. uniformity equality, the States The of United General very appropri- Attorney that, taxation of said the constitutional exemption ately .from rents otherwise than estate, incomes from the of arising real the the States on basis of tax, apportioned among by the of Constitution, the was new theory impor- numbers, not could tance of exaggerated. the whole-Country to. of of that view the If the correctness has one questioned decision ought again rendered the hearing; original included constitu- court has now that this .questioned, the tional rule of uniformity, personal prop- from the exemption from invested of derived personal erty incomes country income tax in hereafter an If shall impose property. Congress nation and provide debts order meet the of pressing isit advised, for the by government, necessary expenses the income touch it cannot rendered, now judgment in- from from personal property, real estate nor the income vol. clviii —43 TERM, 1894. Harlan, Opinion:

Rehearing. Dissenting or uninvested, vested by apportionment except among States on the basis of Under that system population. of of State, 1,000,000 inhabitants, containing who people real and receive income from $20,000,000 annually personal no than exacted more would be from would pay number of another same State, inhabi- people having but kind of tants, who receive income the same If new $5,000,000. this theory I it to if be, believe this new from the safe departure way marked out so fathers and followed by long court, can-, law, fundamental the American justified by people not too amend soon their Constitution.

It was said that the statute im- argument passage an this income assault posing poor upon and much this court has been rich, speech eloquent urged to stand in the breach for the protection just rights hosts of With tho socialism. property against advancing of this has character, this court policy legislation nothing to do. That is for the branch of the legislative governmefit. It is for to determine whether the necessities of the Congress are to be or the met, interests of the government sub- people taxation served, of incomes. With that determination, so far as it rests upon grounds public expediency policy, .the no courts can have concern. rightful safety of our institutions each demand that permanency department shall within its government keep de- sphere legitimate fined the law of the land. deal We here supreme ' with of law. law contains questions Undoubtedly, present that for reasons to objection, but, be exemptions open such be stated, without presently exemptions may disregarded the entire law so invalidating exempted be under the reached statute. may provisions general U. S. Worthen, Huntington

If it true that this were its important legislation, aspects and in essence, its discriminated of rich, because against 'their wealth, the in vindication of the court, of all equality before the that law, well the statute was not an declare might exercise of the of but was to those taxation, repugnant r. FARMERS’ LOAN TRUST CO. Opinion: Harlan,

Rehearing. Dissenting of natural which our free institutions right upon principles under therefore, and, rest, legislative spoliation, guise no of taxation. But it is not of that character. There is for the framed foundation that this statute was charge to the wealth of the sheer hostility country. provisions liable to are those from taxation most objection exempting amounts of accumulated particularly large capital, insurance mutual represented banks, by savings companies, not and loan do indicate associations. such Surely exemptions branch on the of of part govern- sympathy legislative ment with the theories nor show socialism, pernicious the rich. had any despoil Congress purpose as In this connection, annulling pro- ground refers to the for the visions counsel incomes, appellant taxing not exceed is said $4000. of incomes that do exemption be That an is too amount. that such may exemption large reason for that alone declare conceded. But court cannot I take will concede one, it, invalid. Every exemption an incomes, allow rightfully Congress, taxing done' in the income That some amount. exemption 'was and was never laws, tax laws of 1861 and in subsequent rest grounds public Such questioned. exemptions' upon court which this which must policy, judge, Congress cannot and that cannot determination rightfully judge; interfered branch of with government, judicial un- and is so unless is of such character exemption court to as to authorize the Congress, reasonably say large for the under the good, pretence merely general legislating has burdens that, every few principle put upon persons have taxation, and under sound view of ought justice every n mass of been people. all or placed upon great $2000, or even If at had been $1500 exemption placed in so I doing, would contended that think, Congress, have few, cost the increased had its exceeded In view powers. the difference times, at other

living day, compared so between either of amounts and great $4000 those the income tax the courts in down all pro- justify striking rest is that visions. The basis exemptions TERM, Harlan, Opinion: Rehearing. Dissenting welfare that such ,in general incomes, requires taxing (cid:127) as will should be made annual cover exemption fairly of' and thus members family, expenses average prevent such families public. becoming charge upon returns, statute when allows their corporations, making net and busi- income, deduct actual profits operating (cid:127) ness as I like Upon expenses. grounds, suppose, Congress incomes under exempted $4000.

I answer to made this court may say, the-appeals, vindicate constitutional rights owning large citizens and real friends of that incomes, properties having large t.he those who would the wealth of the property exempt its fair share of the burdens taxation, country bearing but rather those have who seek to without reference every one, (cid:127)to his his contribute from terms of locality, substance, upon all of the others, equality support government. There of an tax nature income se that nothing per to it justifies that it judicial opposition upon ground discriminates the rich or undue bur- illegally against imposes dens that class. no in its There is upon essence, which, more than an if the tax, income statute just equitable it allows demanded imposing as are exemptions considerations public and are consistent with'the recognized the law, before principles equality persons and, while for its do not providing collection unneces- ways irritate sarily reaches annoy taxpayer, earnings of the entire property country, governmental except agencies, individuals those, compels whether who receive such there- corporations, to contribute earnings, from a reasonable amount for the the common support of all. government

We are told the burden this'income argument if tax, will collected, fall, and was fall, might imposed almost entirely few people has been imposed votes of Senators Representa- tives of States whose will small relatively very people pay of it. This part it is throws suggestion, light supposed, the construction to be and consti- the Constitution, given FARMERS’ & TRUST LOAN CO. Harlan, Dissenting Opinion: J. this reason court should strike down a sufficient the why tutes income that has made for an tax. It is a Congress provision to been made in never have a court of ought suggestion to But it have received some seems consideration; justice. that the of to and it is said the collect lay for, grant power of in the belief of framers the direct taxes the Constitu- was, that would not exercised and discrimi- tion, “unfairly to States or otherwise, as mere by particular majority nately, whose were of those constituents vote, possibly intentionally the to of burden.” for not cause any subjected part pro- it has been found deemed to intimate regret appropriate had in a the law now before us its desire the origin upon in the two of of a Houses to majority Congress impose part (cid:127) undue burdens of States. people upon particular I am unable that the of to our perceive performance duty as in an to the resi- should any degree, depend, inquiry are of the who statute to dence' by persons required' pay of, under the income tax. United If, bounty States, of or for the beneficent other legislation Congress, any of the have some other reason, country parts outstripped no reason wealth, surely population why parts not of the should more favored States share people of all the States burdens alike.with government people in one the Union. Is a body part given people vast from which owning properties, United although millions of more are derived, regularly many consequence or of the tribunals than Constitution judicial eye the like number of other who parts country people (cid:127)? that rest do not the same enjoy prosperity Arguments favoritism the sections power particular law-making and to mere or to kinds of country particular property, do not commend themselves my mind; for, cannot but tend a conflict that result in to arouse giving as well our midst who life, to those energy, to those, section section as eager array unhappily against few idea of our number, who are without free in- any proper stitutions, who neither for have the'rights respect prop- nor of what is law. erty liberty regulated by conception TERM, Harlan, Opinion:

Rehearing. Dissenting It is said that if for exists necessity general govern- ment to direct raise taxation sum of given money, addition from duties, to the revenue and excised, imposts, can be each State on the basis quota apportioned can census, assess the government proceed amount all the to be real and raised well personal property, in the State, income, collect the persons tax, not in the if the State does meantime its and reim- pay quota, the amount itself, it, burse paid by collecting according its ow.n in its own Of course, is not system way. diffi- cult to understand that when tax, assessed, may collected without general government waiting to the States sum to their or that pay apportioned .people, time to the States to such amounts. may But given pay view not meet the does the assessment argument — of collection tax on incomes such tax being on the basis of numbers in the merely apportioned respective —States never the of the framers Con- contemplated by stitution. Whether such a tax be collected the by general its State, own or from government through agents, such of the have subject incomes to tax people imposed, to immaterial the discussion. In either case, the gross that would result injustice would be the same.

If should a tax of a Congress lay amount given aggregate on incomes a named (above taxable sum) source, every the same apportion the States the basis of among could numbers, State be to any assume and expected pay to sum it, then to assigned reimburse itself proceed all the real and within its taxing property, limits, personal, those have no thereby who taxable compelling incomes to contribute from their means to taxes assessed pay those who have taxable Would incomes? State use money to all of its for the of belonging people purpose discharging due from, taxes or of assessed them ? Is against, part manifest a national laid on incomes or on specific' if 'personal the States- property, apportioned among basis be ruinous of those population, might people States or incomes, the number taxable having & TRUST v. FARMERS’ LOAN CO. Harlan, Opinion:

Rehearing. Dissenting kind of were relatively owned that who particular is taken into of the State the entire few when population of the States com- ? So diversified are account industries if select the Union should that, par- government posing or ticular apportion subjects products taxation their to be raised the States, popula- suin among according out of would be the amount some the States tion, paid by within or value of such the quantity products proportion their limits. respective intimated, also or rather it is said, has been of the that the

framers Constitution intended lay war, direct taxes be exercised time should only and that tax on incomes is not justified great emergencies, it to that the courts times Is be understood peace. incomes, an a tax on when- annul act of Congress imposing not demanded in their ever judgment legislation tax on Is a any public emergency pressing necessity? -but unconstitutional war, income^ a time permissible action a time Is peace? judiciary supervise branch questions legislative government upon ? to override the will Are public policy people, in their because, their chosen servants, judg- expressed by in execu- means ment, by Congress particular employed not the tion conferred Constitution powers neces- or are not devised, best that could have been absolutely was to for which government sary accomplish objects ? established national taxa-

. from It is further the withdrawal said States on the basis tion, except by among apportionment invest- stocks, and bonds, of of numbers, personal property, as well therefrom, ments of all and the income kinds, arising estate, intrinsically as the income real just, derived from can be made all incomes because all such and property that come to of the burdens bear, and do their bear, share from state But those make argument' taxation. who ren- now all the the decision which, forget by property the rule of dered, taxation remains to national by subject is, to be taxed uniformity also, respective subject by . TERM, Harlan, Opinion: Dissenting Incomes from trades, States. arising employments, callings, can be and under the taxed, rule or professions uniformity both the national and the equality, by government respec- tive state while incomes from bonds, governments, (cid:127) and stocks, cannot, investments under the decision, present be taxed the national under the by government except imprac- ticable rule of the States to apportionment among according No sound reason for such a discrimination has population. been can be-suggested. am of

I that with the and opinion exception capitation land and taxes on taxes, from the and Statés exports and instrumentalities property government order to debts and Union, its for pay provide welfare, common defence and under its general taxes, and collect duties, lay imposts, excises, .may under the rule of reach, uniformity, property in whatever State be found. This as it rights may and as it be, be, should must if the national is to government be administered and is to upon principles right justice, the' beneficent ends for which it accomplish was established the United States. The People to sustain authority its itself, own and, laws, execute the agents powers are the features it, granted particularly distinguish the' Confederation which present government Washing- characterized as “a half-starved, ton government,” limping “always at moving crutches and tottering The vast every committed step.” powers present gov- ernment abused, taxes Con- may imposed by may which the do not public necessities in fact gress -require, be forbidden wise But the policy.. remedy is to be found such abuses at the and in ballot-box, a whole" some which the opinion public representatives people will not if at all, and not' in the disregard, long, disregard that have been' committed judiciary powers to another branch the government.

I turn now another of these cases. The part majority decided that the income tax having statute provisions unconstitutional far so a tax they impose v. FARMERS’ LOAN & TRUST. CO. 681

Rehearing. Dissenting Opinion: Harlan, J. derived from rents, income on income from derived personal invested including personal conclusion property, been, reached that all has the income tax provisions valid, those statute, that are as well as held to those be invalid, be held must void. And inoperative so now judgment entered takes to be from the the entire revenue that government to raise the taxation of incomes. This Congress expected to all the revenue, to us in estimates submitted according argu- would not have been less ment, than $30,000,000. have Some that would amount to estimated or $50,000,000. $40,000,000 which the The court down now strikes all the ground upon of the statute to incomes is, provisions relating anywise ’ it cannot be assumed that would have Congress provided tax if it all, an income at had been known or believed that the from incomes rents and from invested taxing per- provisions sonal were unconstitutional and void. property v. U. In Allen S. this court that it Louisiana, 80, 84, said “ anwas that the statute be same elementary principle may constitutional and and that if unconstitutional, part part are each that which is other, parts wholly independent stand, while is constitutional unconstitutional may thfit “ be will The to be in all such determined rejected.” point the court further the unconstitu- cases,” said, whether are so connected with tional provisions general scope . if as to make it out,

law stricken impossible, give, to what have been the intent of the effect legisla- appears ture.” case on this Worthen,

A Huntington subject leading 102. The constitution of Arkansas of 1874 120 U. S. 97, pro be taxed that all to taxation should vided subject property to be to its ascertained in such manner value, according the same direct, assembly might equal making general no one State, uniform and that species throughout taxed from which a be collected should property value. than another of equal species property higher laws exempt constitution State further declared that in that than as taxation other property ing provided rail- No instrument should void. part TERM, 1894 Dissenting Opinion: Harlan, J. was road constitution from taxa- exempted by companies A statute tion. the taxation of the subsequent provided however, of railroad from the companies, property excepting, to be returned schedule property required embankments, ties, trestles, This court turnouts, cuts, held that bridges.” items railroad was exemption property invalid, these arose whether the statute could be enforced. question “ The This court said i unconstitutional of the statute was part the remainder. The statute declared that, separable statement of the value of its its the rail- making certain, should omit road items; clause company being rest held remained invalid, unaffected, and could be out. An carried' which was exemption, invalid, was fully It alone taken from it. different clauses of an only when. each act are so other that it is evident the dependent enacted, would have one of them without the legislature other —as the two when are things provided necessary parts — of one whole act will fall with the- system the invalidity one clause. "When there is no such connection and depend- the act will stand, different of it ency, are though parts rejected.” observed should be of Arkansas legislature a not to tax

evinced embankments, purpose turnouts, cuts, ties, their trestles, bridges, those items yet exemption n and such was taxed. The same disregarded rule could be statute. applied present The of the court judgment bn the opinion hear- original of these cases annulled so much of the ing statute as laid on incomes derived from rents. duty opinion judg- on this ment annuls also so much rehearing of the statute as on the or income derived from lays duty yield personal prop- - invested in- erty, including personal bonds, stocks, property,' of all kinds. vestments I all these recognize . parts stricken the statute ou.t,the law would operate unequally Snd -of the But I do not feel unjustly many at people. the balance of say the act to incomes liberty relating from other and distinct sources must fall.

It seems to me that the cases do not the conclusion justify FARMERS’ LOAN & TRUST 00. Opinion: Harlan,

Rehearing. Dissenting that income tax sections statute must fall are be béeause some them declared to invalid. Those sec- number taxable tions.embrace that do large subjects not. no necessary connection whatever depend upon, have or clauses with, sections income from rents relating of' and from land As the statute in personal property. question its states that was to reduce taxation principal object pro- vide be revenue, must assumed that revenue is needed for the and, therefore, its support government, sections, so far as valid, remain, should while those that are invalid should The rule referred to in the disregarded. cited cases ábove should not .with strictness where applied the law is a law a revenue for providing general statute Parts of the to be government. being adjudged done void, to those incomes be injustice whose those, reached of the statute that are not provisions in themselves, invalid, to be, could, some way, declared compensated by subsequent legislation.

If the sections of statute to taxa incomes relating upon than derived from .other sources rents and invested personal are fall because and because those property relating from rents and. income invested are personal property invalid, let us see to what result a rule may logically stahite lead. is There no for distinct, separate providing The incomes. income tax certain prescribed, by sections of a known as the Wilson statute Tariff act. general rendered defeats the judgment just purpose Congress out of the revenue not less than millions, by taking thirty of dollars, millions to be raised possibly fifty expected on incomes. We know from the official duty journals of both Houses of that taxation on would Congress imports not have been reduced to the extent Wilson act, for could the belief that that done if except safely had of revenue the benefit derived from tax country on incomes. We from official that know, each House sources, out refused strike Congress distinctly provisions a tax on incomes. The two Houses indicated in imposing that- it must be a every scheme for possible part way any TERM, «684 Opinion: Harlan, Rehearing. Dissecting and for of taxation revenue for reduction raising "the certain (with government, specified excep- support kind and from arising every, tions)-incomes should bear some of the burdens of trade calling -every If court or is knows, imposed. justified taxation not have would an iñcome provided believing, Congress did not include a tax incomes from real estate tax that we are more -and justified believing personal act would have become a without law, of the Wilson no part income made in for an tax. If, therefore, being provision Wilson act fall tax sections of the must because -all the income not the does invalid, of them judgment day «orne for the contention that entire furnish rendered ground from it all of the income tax the court strikes net falls when one the act knows, would which, without every provisions, ? been never have passed

. no takes care to that there is court say But tha of the Wilson act, those except validity part for tax on Thus incomes. sections providing something and maintenance (cid:127)saved support government. those the Wilson act results It, nevertheless, parts n that survive' the Constitution the. new evolved theory burdens are those these' cases, imposing great body estate, derive no rents from real American who (cid:127)of the people invested not so fortunate as own and who are personal or the bonds stocks of such as corporations, control the entire business of their almost hold within the (cid:127)country. to be cannot be a result is one

(cid:127)Such deeply deplored. to the otherwise than as a disaster country. regarded — for reasons of an dislocates now (cid:127)decree passed principally, — nature granted (cid:127)economic sovereign power expressly and established and fully long recognized government general apd It so actions. decisions legislative interprets by judicial n constitutional provisions,- originally designed the protect as to taxation, give against oppressive priv- «lave property the immunities founders never' and contemplated ileges, (cid:127)of government. .the v. FARMERS’ LOAN TRUST CO. 685- Opinion:

Rehearing. Dissenting Harlan, J. If the of the decision stricken had down all majority the either income tax because sections, of unauthorized exemp- of tions, because defects that could have been remedied the result would not legislation, have by subsequent been one to cause in such a for, anxiety regret; case, could Congress have enacted a new statute that would not have been liable to constitutional But the seridus the objections. aspect-of pres- ent decision a new of the Constitu- interpretation tion, so ties the hands the branch legislative the gov- of. ernment, that an without amendment of that instrument, or at some future court, should lyiless time, return old of the Constitution, cannot theory Congress subject — taxation however the needs or the necessi- great pressing — ties either the invested government personal prop- of the erty bonds, stocks, investments of country, kinds, or the income of real arising renting estate, or from the yield personal property, except by grossly rule unequal unjust apportionment States. among Thus, undue burdens are disproportioned placed upon few, while the entrenched behind many, the rule safely on the States apportionment among basis numbers, to evade their share of permitted responsibility protection of the ordained for the support government of all. rights I cannot assent to an of the Constitution that. interpretation of the National Govern- impairs cripples just powers inment matter of the essential and at the s'ame taxation, time discriminates the' of our. against greater part people country.

.The of the is to effect decision certain practical give to-day kinds of of favoritism and incon- property position advantage sistent with the of our fuxidamental social principles organiza- tion, and to invest them influence that be to that of the American perilous whom people portion rests the burdens of government, larger part who to the dominion of ought subjected aggregated.' more wealth than should country at lawless.' mercy TERM, 1894.

<686 Brown, Opinion: Rehearing. Dissenting <1. the court.

I'dissent opinion judgment Brown Justice Mb. dissenting.

If the and what is a direct not, were is, tax, what for I should entertain a now, the first time, presented, grave in of a whether, (cid:127)doubt view of the definitions direct tax given the courts writers economy, upon political during not to held century, apply present ought .-anincome but to the burden which tax, tax, borne, every both it. immediately ultimately, by person paying this is the definition had in not, does follow however, mind of the framers Constitution. clause that taxes shall be direct apportioned according population said Mr. Paterson, was as was Justice Hylton adopted, to meet a oh States, v. United demand Southern part taxes should be "States, direct representatives appor tioned the States their numbers. among respective according'to In this connection he was made in observes: The provision favor of the Southern States. number They large possessed of slaves; had extensive tracts of settled territory, thinly .and not A of the States had but very productive. majority few several of them a limited well settled slaves, territory, .and state of cultivation. The Southern if no high had been introduced in would have (cid:127)provision been at the other States. wholly mercy Congress, such case, tax at discretion or slaves, might arbitrarily, land in of the Union at the same rate or every part measure; so much a head first and so much an acre instance, the second. To them in these guard against imposition, par ticulars, was the reason the clause the Con introducing stitution, directs taxes representatives ^.nd shall be the States to their apportioned among according numbers.” 3 Dall. respectives

In view the fact that burden of taxation great among the several States is at a valuation, assessed real estate and that a similar an apparently important part revenue such States at the time the Constitution was v. FARMERS’ LOAN TRUST CO. 68T

Rehearing. Opinion: Brown, Dissenting J-. it is not unreasonable to that this is the adopted, suppose only- undefined direct of framers the Constitution tax. had in view when this clause into that they incorporated instrument. ” “ of the words direct taxes was. significance not so well then as it and it is understood; now, that entirely probable these words were .used with reference to a generally accepted method of a revenue tax real estate. raising upon

That the of rule was for a apportionment adopted special with the temporary purpose, existence passed away of it should be slavery, construed, also narrowly evi- dent from the of Mr. Justice wherein opinion Paterson, he “ the Constitution has been considered says as an accom- it was the effect of mutual modating system; sacrifices and concessions; it was the work of The rule compromise. is of it is nature;

apportionment it radically can- wrong; not be should solid supported by any "Why reasoning. slaves, who are a be more than species represented other ? The not, therefore, rule to be property ought extended construction. do numbers not afford Again, esti- just mate or indeed, rule wealth. is, uncertain very There is another reason incompetent sign opulence. against the extension of the laid down in the principle, Constitution.” however this I it as

But, be, clear regard very the clause direct taxes to apportioned requiring be pop- ulation no taxes which are not application capable has. It cannot be

apportionment according population. supposed that the convention could have contemplated practical inhibi- tion in some to tax all taxable power Congress way within the Federal jurisdiction government, And if the of a national revenue. purposes tax proposed were such that in nature it could not be its accord- apportioned that it could follows not ing have population, been naturally a direct tax, within clause in considered meaning ques- tion. This was the of Mr. Justice Iredell opinion Hylton case,wherein he shows at considerable the fact that the length in that case, carriages, could be not a therefore, was and, apportioned, tax in “ the sense of the Constitution. he said, Suppose,” ten dol- TERM, 1894 . Brown, Opinion: Dissenting chariot, a tax on each chaise,

lars post contemplated both the number of the States the United 1,05 Con- be at number Representatives —the computed one the whole thousand and would produce ,gress —this the share of would dollars; fifty Yirginia, being parts, .Connecticut, the share of would being parts, $190; ygy then had Connecticut Yirginia fifty carriages, suppose $70; share of must- of course two, $190, ihis Yirginia being be collected from the and there would, owners carriages, be collected from the share therefore, $3.80; each carriage of Connecticut each In would being pay $70, carriage $35.” no car- needs demonstration to fact, show that taxes -upon or article of any particular riages personal appor- property, tioned to the of lead to the several would population of like articles in since number grossest inequalities, such State bear a respectively might propor- greatly unequal tion to the This was also the construction put population. the clause Mr. Justice work his upon Story, upon Constitution, §§ the same course of income tax,

Applying reasoning us let see what the result would census of 1890 be. theBy of the United States was population 62,622,250. Suppose desired raise an income tax the number to same Congress of or the of one dollar from inhabitant. dollars, each equivalent of would Under Massachusetts system apportionment, Carolina Massa- $2,238,943. South would pay pay $1,151,149. chusetts has, of with however, $2,803,645,447 property, but. to or while South has it, Carolina pay per capita, $1252 or inhabitant. Assum- to .each $400,911,303 $348 that the same amount of in each State represents ing of South a amount óf inhabitant each income, corresponding one- Carolina would three and to his means pay proportion half times as much as each inhabitant of Massachusetts. By a valuation the same course-of with reasoning, Mississippi, much as Rhode would four times' as per capita, pay $352 Carolina, with a valuation North Island, per capita; $1459 four with a would about valuation of $361 per capita, pay York, times her as New much, means, proportion v. FARMERS’ LOAN TRUST CO. 689 Brown, Rehearing. Dissenting.Opinion: valuation of $1430 with a while per Maine, capita; valuation about twice as bapita pay $740--would per much. $412, with a valuation of Would Alabama, three pay nearly with a times much as valuation of Pennsylvania, $1177 fact, In there are two States that capita. scarcely would per the same to their amount pay proportion ability pay.

If the a similar States should adopt taxation, and system allot the amount be raised the different cities and among wards of the towns, same among different city, pro- to their the result would be so portion population, monstrous the'- entire would out it. public cry against Indeed, reduced to its last the same tax analysis, imposes urxnrthe laborer that it does the millionaire. .upon

So this court also, whenever has been called upon give construction to this clause has uni ” held the words taxes versally applied only capita tion taxes and taxes land. In the five eases most upon directly it was held that the point taxes were not following direct, but rather in the nature of duty excise, viz., upon v. United States, Dall. carriages, Hylton a tax 171; upon business insurance companies, Insurance Co. v. Pacific Soule, Wall. a tax of ten 443; per 23 Wall. 331; a and, finally, income general broadly in v. United upheld U. S. 586. Springer These consistent cases, are, undeviating they extending over a of our national life, seem nearly to me century to establish a of it canon which is now too late interpretation, to or overthrow, even to If there be c|uestion. at any weight all to be to the of doctrine stare it given decisis, surely ought to to a of constitutional apply theory construction, which has received the deliberate sanction of this court in five cases, of the faith which has enacted upon two income Congress at in when, .taxes times its sources judgment, of extraordinary revenue were to made be available. necessary

I have entertained the view in that, cases always turning of or questions upon jurisdiction, involving only rights vox. cxvm—44 .TEEM, Opinion': Brown, Dissenting feel at courts should to

of settle private parties, liberty prin- to of their of law mem- according opinions ciples existing nor bound of, neither bers, implicitly regardless by, prior . that, the condition to do not decisions, they subject rules of of settled There the disturbance property. require which it. is however, number of more are a vast questions, settled in than that some should way they important the solemn and once settled should be settled right, adju- of and the court last resort,' dication of the legislature settlement as forever have a rely upon people right in that Even their connection. century fixing rights ” than a be less with evil to State error pregnant long of the truth. I cannot reconcile myself deferred discovery made, idea that thus usually by adjudications solemnly (cid:127) reason of a should now set aside court, unanimous because to the correctness those doubt as adjudications, would have been the cases we may suspect possibly decided, if the had before court had otherwise the.wealth which has to bear been brought learning never of this case. legis- consideration ought Congress in fear the revenues of the late, raising government, of this court the veto like this shall encounter laws important or,be polit- its great crippled through change opinion, for immediate^ revenue its raise a ical crises by inability such exigencies use. Twice this country history arisen, patriot- have and twice has called Congress of an of its citizens ism income imposition respond in the war, exigency throes civil and once tax — once financial language (cid:127)of a less disastrous. panic, scarcely 2 How. Astor, Lessee Baldwin, Mr. Justice Grignon's seems cases, to a different class 343, though referring consideration. under to me to the one perfectly apposite to retrace hereafter, do not deem “Ve now or necessary, of this decisions or the ©n the reasoiis authorities rested; it, cases that, court which preceded on the oldest and are founded most sacred principles courts ;'the Time common law. has consecrated them never followed, State has departed have this court v. FARMERS’ LOAN & TRUST CO. 691 Brown, Opinion: Rehearing. Dissenting them. rules They property upon repose under the titles country depends; acquired proceedings of courts of must be deemed invio- jurisdiction competent in collateral or none can lable know what is his actions, own.”

It must be that in none of however, these cases admitted, has the been toas what are taxes directly presented land within the the constitutional upon meaning provision. the authorities cited this point Notwithstanding upon 5 General, Case, ; Coke, 67 Attorney notably, Theed Jeffrey's v. 8 314; Mod. v. Case Starkey, 297; Stephens, Fitzgibbon, 4 Palmer v. Irish C. L. Power, Van 191; Rensselaer (1854) v. 8 a Dennison, 23, Barb. to the effect that tax a upon person to his or the of his is not land, land, a tax respect profits I land the doctrine well set upon itself, regard entirely tled in this that a tax an incident to a court, upon prohibited is a tax if itself, there be a thing and, total thing upon want of to tax the there an power want of thing, equal to tax the incident. A of the cases summary upon in point this connection. in inappropriate Thus, Brown v. 12 Wheat. 419, license tax Maryland, an upon a was held to be a importer invalid as tax in upon imports; Weston v. Charleston, 2 Pet. a tax 449, stock for upon loans to the United States was held invalid as a tax the func upon tions in v. Dobbins 16 government; Commissioners, Pet.

435, a state tax on the of an office as a salary invalid, tax the office upon ; itself Cases,7 a Passenger How. 283, tax alien upon State was passengers arriving ports held void as tax v. commerce; Almy upon California, # 24 How. 169, tax bills was held to be stamp upon lading a tax 6 Nevada, 35, v. Wall. exports; Crandall tax upon railroads and for every stage passenger companies carried.. out of the State, tax on was held to passenger v. Pickard State; Pull privilege passing through man Southern Car a tax Pullman U. S. cars Co., 117 between running held to be bad as a different States was upon interstate commerce; Mobile, S. Leloup U. 640, a similar to a was made with license tax ruling regard TERM, Opinion: Brown, Dissenting Cook v. finally, Pennsyl companies; telegraph the sales of a tax held to S. goods U.

vania, upon Indeed, themselves. cases to the the goods be a tax upon . In the innumerable. of these almost light same effect the conclusion that a tax escape find it I (cid:127)cases, impossible land, estate is a tax of real income the upon rents or the upon itself. whole the To the does not cover question.

But this bring rule, it must not be a the of. apportionment, only tax within be a direct tax The it must land.' but land, upon tax upon be that direct taxes laid the rule only requires Constitution that direct have include taxes of We held apportionment. it but does not follow from land; taxes others upon among that, land is a tax direct A upon every tax.. these premises whether. animal, of or land, vegetable, tax product upon, within the sense, decisions perhaps in a certain is mineral, land; For,” as Ford Coke a tax mentioned, upon above but thereof?” But it land is the profits “what said, be could claimed that a it hardly seriously me. seems or, of farmer, cattle coal and the crops tax upon levied while it miner, upon though iron direct land, was a land. A tax.upon upon remained land within the same of falls my opinion the rent tax upon in the name of a difference rather It is thing category. taxation. The rent is no than .the taxed, principle or land than profit outgrowth more directly either in- direct tax an and a coal, only upon crops the cases above within While,- cited, the land. tax upon one direct tax it is a land, only upon tax it ais upon a direct tax is not land, only upon many profits other that it but is objection also itself, .the subject land nature, according in its incapable apportionment is, population. ' cannot that .what be done we have often held is true when but be done cannot indirectly, directly applies can done at all, indirectly; directly it cannot but.if.it the. one i.e. manner, apportion- done fule directly-in not be done indirectly not follow it does ment, v. FARMERS’ LOAN TRUST CO. 693 Opinion: .Rehearing. Dissedting Brown, J. is no manner. There

in another want power the part land, in- to tax but exercising must Congress power the rule of direct taxes The impose apportionment.

still indirect remains, however, impose taxes the rule of a tax rents is an uniformity. Being opinion upon .that indi- lands, I am- rect tax driven to the conclusion that the valid. tax the income-of bonds falls municipal obviously g

within the other of an indirect tax category, upon somethin has no to tax at all; and hence is Congress right invalid. Here ais not of the method of question, taxation, but of the to the to taxation in form. power subject property seems to me that the of eases v. 11 Collector Wall. 113; Day, that it is not to a tax holding Congress competent impose the of a officer of a upon salary State; McCulloch v. judicial 4 Wheat. State- could 316, not im Maryland, holding a tax the of the Bank of United pose the upon States; operation añd United States v. Railroad Wall. Co., 322, 17 holding is a of the municipal of corporation portion sovereign power the State, and not is to taxation its subject Congress upon revenues; Price, Wisconsin Central v. municipal Railroad 133 496, U. S. no has the State to the tax holding power of the United States within its limits; Van to Brocklin U. S. the Tennessee, same effect, 117 apply to mutatis the bonds and the tax mutandis question, upon them be invalid. must, therefore,

There certain of is, want this uniformity particulars, law, which have of -some im created the minds may ,it pression not to shift the studiously designed of burden cer taxation but to class, upon wealthy exempt tain favored cer There is its corporations, operation. ' no of want within the tainly uniformity meaning Constitution, since we held that uniform have repeatedly there ity referred to v. Blake, is territorial Loughborough only., 317; Wheat. In Head 112 U. S. 580. Money Cases, “ through words be uniform Constitution, the must out the United States.” however, of the .a tax is

Irrespective, which TERM, (cid:127) Opinion: Brown, Rehearing. Dissenting members of the class among same uniformity is, wanting But this does invalid. not be, deprive legislature make to such exemptions, provided rest power exemptions are not some or created purely principle, arbitrary, for the some purpose favoring solely person body Thus in civilized is every there an country persons. exemption which would incomes, tax, small be manifest cruelty and the make once power exemptions granted, within discretion is amount and so legislature, long is abused, not as that courts are bound wantonly it. In law an there is of $4000,' respect exemption indicates a that the purpose part Congress, of this tax fall on burden should or at least wealthy, If men who an the well-to-do. have income or property their needs are not the ones to taxes, beyond pressing pay in other are; words, is difficult who taxa- say enlightened and not tion is Poll imposed upon property upon persons. (cid:127) a considerable source of taxes, formerly now revenue, obsolete. $4000 practically exemption designed, cover actual undoubtedly, living expenses large it is families, fact that to cor- majoi’ity applied the fact that have no porations explained by corporations The of their corresponding expenses. expenses profits earning in course, of deducted the same the are, manner as corre- of a individual are deductible from expenses private sponding of the his business. of The moment the earnings profits are over to the the stockholders, corporation paid exexnp- tion to $4000 attaches them in the hands of each stock- of holder. that fact banks and mutual insurance savings companies, are to

whose are holders, paid profits policy exempted, expli- the one or cable on a sound I need not theory, (whether not, that these to in not, institutions their inquire,) original stop intended as schemes of for the accumulation money; conception, in and if this certain cases, as an abuse exemption operates with to certain it is very respect corporations, prob- wealthy of the to the able that abuses was recognition necessary the class. whole exemption v. FARMERS’ LOAN TRUST CO. 695 Opinion: Brown,

Rehearing. Dissenting is difficult to the It overestimate these importance cases. cannot I I overstate the feel at the certainly regret disposition of them the court. is never a to made set light thing the deliberate will of the aside legislature, my opinion it should never be the done, clearest of its except upon proof conflict with the law. for the Constitu- Respect fundamental will tion not a narrow and technical construction inspired by shall limit impair necessary powers Congress. Did reversal of these cases involve merely striking of the down features this law, even whole inequitable for want of its law, would be uniformity, less consequences serious; but as a declaration that income tax implies every must be to laid the rule of according deci- apportionment, sion involves less a surrender of the than nothing taxing power to the class. an moneyed By resuscitating argument and has lain case, Hylton dormant exploded practically for hundred it is made to do not years, duty nullifying, law alone, this but similar law that is not based every upon Even, an impossible theory apportionment. spectre socialism is taxes conjured up frighten Congress laying to their ability them. upon people proportion pay It is commentary certainly Constitution strange a demócratic United States government no a tax which is one of has the main Congress lay . sources of revenue of civilized State. It is a con- every nearly I find fession feebleness which unable to myself wholly join.

While I have doubt find no will some means Congress fear is some crisis, mo- surmounting my present ment national this decision will rise frustrate its peril up will'and its arm. I first paralyze it'may prove hope toward the of the liberties step people submergence a sordid of wealth. despotism

As I cannot decision of conviction that escape court in immeasurable case is great danger fraught future of the and that approaches country, pro- of a I it a national feel enter portions calamity, duty my it. protest against OCTOBER TERM,

.696 Jackson, Dissenting Opinion: Mr. Justice Jackson dissenting. ,

I am unable to assent to the yield my judgment court cases. these has not been My strength equal task of formal since the preparing decis- dissenting opinion dissents ion I concur expressed ageed fully upon. Mr. Justice White on the former and hearing Jus- tices who dissent will will and add a brief now, outline views the main and my decided. upon questions presented

It is not and cannot be denied that, under the broad and conferred comprehensive taxing, power Constitution the national has the to tax government, Congress authority incomes from whatsoever source whether from real arising, estate or otherwise. clear personal property equally in the exercise of this has the discre- Congress, authority, tion to the tax incomes above a amount. upon impose designated and now underlying is,- controlling question presented whether a tax on incomes received from land and personalty “ rule, ais direct tax,” and to the subject apportionment. income,tax

The decision of the court, law of holding 1894, void, is based August, upon propositions: following That a First. tax real di- personal property rect tax within the and, such, meaning order to be valid, must be .in the several apportioned among States their Second. according respective populations. That the incomes derived or realized are from property an incident inseparable thereof, so far partake out of nature arise as stand property the same as the From these footing itself. property the conclusion is reached premises that a tax on incomes arising from both real and personal tax,” is a property to the same rule of subject as a laid apportionment directly on the itself, the act so being imposed rule of according numbers, is unconstitutional Third. That void. of the tax on invalidity incomes real personal' property established, being remaining the income tax law also portions void, notwithstanding the fact that such within come remaining portions clearly & TRUST LOAN CO. v. FARMERS’ 697 Jackson, Opinion:

Rehearing. Dissenting duties or excises as of taxes respect designated class has no but which rule of application, which the apportionment the rule of uniformity. are controlled by regulated be found and could not found, not properly law the other that there is'in court, provisions to render these remain- as would sufficient lack of uniformity no essen- is,therefore, for that reason. There void provisions ing of incomes which the court connection the class tial between and the other class holds to be within the rule of apportionment I understand and cannot within the rule of uniformity, falling the conclusion that, which the court reaches the principle upon for the reason.that the the law is invalid because one branch of thq it defeats thereby not laid rule of tax is apportionment, rule uni- anóther branch upon and invalidates resting is no valid there objection. to which formity, respect is sound, this third court on proposition the conclusion of the If could rests equal propriety the.principle upon 1894. act of the entire revenue August, extended-to considerations. have these They I shall not upon dwell Harlan. There is Mr. Justice as elaborated just been fully would not have much room for the Con'gress assumption law without the of the branches provision the customs passed estate, from real and that they incomes personal taxing rest- to incomes relating 'would not-have .provision passed Unconstitutional rule provisions of uniformity. upon ing constitutional defeat pro- doubt, no sometimes will, of an act connected essentially inseparably where are so visions .they valid of the enforcement part as to substance prevent But when the invalid portion. without effect to giving not act are mutually and the invalid valid portions considerations, conditions, each Ót-her dependent valid and the other, portions for each compensation are never, the latter enforcement, espe- of- separate capable of invalid void because por- in revenue declared laws, cially tions of the law. decisions of court in numerous

The rule is illustrated the State Take States. Freight and of the courts highest act was a 232. There Cases, single imposing 15 Wall. Tax TERM, Rehearing. Dissenting Opinion: Jackson, J. on all railroads,

tonnage freight transported by them. law was attacked constitutionality merely carried ground applied freight wholly State, but extended to within received without freight into the and to that received State, within carried brought the limits came State, which within the inter beyond state commerce of the Constitution of the United provision .This States. court held tax invalid as to this latter class but; valid as to the internal freight; being freight, much of law could not be defeated the invalid part, the act the tax was and entire. although To imposing single the same are the effect cases v. Worthen, Huntington 97; Allen U. S. Louisiana, 103 U. S. Ratterman v. 80; Western Union 411 Co., U. S. Telegraph (where point made that the directly invalid should defeat part valid Field v. 143 U. S. part); Clark, 649, In 696, 697. “ "this last case this court said: it be Unless to avoid impossible a revenue it, statute should never general be declared inopera in tive all its because a parts to a dis particular part relating tinct be invalid. A subject-matter may different rule might be disastrous to the financial operations government the utmost in the produce confusion business of the entire country.”

Here the distinction between the two branches of the income tax law entirely rest different rules; separable. They upon one can be enforced without part the other, and to hold that invalid if alleged portion, should break down the invalid, valid is a which I portion, think proposition erroneous, entirely either wholly unsupported upog authority. principle

In whether a incomes considering tax on from question real or estate is a personal within meaning of those words as in the I shall not employed enter discussion upon any court, com decisions this with the in case end mencing Hylton 1796 Dall. (3 171), ing case in 1880 nor shall Springer ; U. S. (102 507) I dwell those decisions law- approval great writers of the all the on the country commentators Constitution; nor will I dwell prac- long-continued v. FARMERS’ LOAN TRUST CO. Jackson, Opinion: Dissenting with the laid compliance principle tice government settle and in those decisions. They, my judgment, down now before the court, contrary conclude if do not settle But, decision. they certainly present should restrain the court a 'doubt on the raise such subject No rule of construc act declaring .unconstitutional. will not settled than that this court declare- tion is better coordinate branch invalid a statute govern passed should be made, ment, whose favor every presumption is clear unless its to the Constitution beyond repugnancy 12 Wheat. Saunders, 213, In reasonable doubt. Ogden doubt was fact of a sufficient court said that the mere pre unconstitutional, the act the court from vent declaring Fund Sinking substance repeated language of the court was given 99 U. S. where Cases, opinion act must be Waite, beyond who said Justice Chief this court would so- before reasonable doubt unconstitutional it. declare method to me the court this case wrong It seems adopts the words direct tax” as. true at the meaning arriving too much It attaches the Constitution. weight

employed of individuals and detached and to expressions importance made adoption writers economy, subsequent political in do not, fact, of and who agree upon any the “ no we derive From sources of a direct tax.” such definition of true To ascertain the meaning real subject. light upon have we should or “direct taxes” words “direct tax” but to the connec- themselves, to the words merely regard and to the are used in the Constitution tion in which they when the Constitution and circumstances existing conditions circum- What were the surrounding was formed and adopted. The only subject I to them stances ? shall refer briefly. very The was land. States of at the time direct taxation prevailing but such did tax of some articles personal property, or valuation assess- was taxation.by not the of subject general was object ment. Land and its principal appurtenances Article of the Confed- all the Ylllth taxation States. By to be out were borne eration the of the government expenses TERM, TOO Dissenting Opinion: Jackson, to be

(cid:127)of a common States treasury, supplied according lands in each to the value surveyed State, granted or to be estimated the assessment to be :suchvaluation made mode as should such time Congress to was a direct tax time determine. This laid directly upon the real estate country. value of all trouble had no it the Confederation was that its enforcing at do, All it could after assessment. assessment arriving was to make its or estimate, several requisitions upon for their were States not met. They This respective quotas. had to radical defect the Confederation be remedied in the Constitution, which new to the national gave accordingly taxation government the-power imposing directly upon or inhabitants citizens country, enforce such without or taxation of the States. instrumentality agency knew The framers the Constitution land was the in all taxation the States. found no .general object They Article of the fault with Ylllth so far Confederation value taxation on the of land and the imposed appurtenances each thereof in State. be

Now assumed that the may reasonably properly framers of the the rule of Constitution adopting apportion several had ment, population the. according or of taxation reference of universal or objects subjects distribution all the States. A throughout general capitation tax had its State, so subject was, poll every speak, ” to numbers. Other direct tax according self-apportioning used in connection with have tax must been capitation to refer to subjects like, having approximate, intended^ relation found in all numbers, It never States. reach to . taxation contemplated subjects' distribution would What a direct of- partial thought thereof laid cotton at so much a apportionment upon tobacco at so much a rice at bale, so hogshead, (cid:127) ton or a much a tierce? Would not the idea of apportioning that tax on in a the States, property, non-existing majority frivolous and absurd ? utterly

Not was land the but subject distributions, general FARMERS’1LOAN TRUST CO. Jackson, Dissenting Opinion: minds the framers of Constitution from in evidently under of taxation that it was the subject the fact Conr ' of the Constitu But at time adoption federation. of a income with the was, tion there single exception partial no tax on Delaware, incomes tax in the State general . Did the framers of the- State thereof nor any this country into future so forward look contemplate' Constitution them ? such a tax as then unknown to and intend cover was I think .not. of the Con It was ten or eleven after adoption years first, her

stitution before the English government passed under the of Mr. Pitt. The income law leadership ques tion which the Justice has referred, then Chief arose, . could or have look whether, income, estimating you any That from which the source sprung. question regard it was loan acts because, material, pro English “free of vided that the dividends.should public paid tax or Mr. Pitt was confronted with whatever,” charge to- on his income tax law whether he proposed or could stocks. He reach reach income said those words must receive a reasonable interpretation, to. true should not look at all construction was you consider divi the nature but source, .that you should tax, for the of the income the relation dends, simply purpose much This construction was the receiver as so income. without over fifty adopted practice1 ques put years . tion In 1853 Mr. Gladstone, Chancellor Exchequer, make with all his the effort to- important, resisting genius before the House said, of the income á tax, changes speech undoubt of Mr. Pitt was that the Commons, construction statesmen correct. These edly distinguished opinions show what the- have but they force of authority, judicial men of distinction thought, eminence men ability of the income tax at its inception. original

If Con- framers I have made assumption .a direct tax stitution in for the providing apportionment which had had in mind a or subjects-matter, subject-matter is; some States is‘correct, general distribution among TERM, 1894. 702 Dissenting Opinion: Jackson, Rehearing. J. — that a

clear a tax on incomes not of distri- subject general ” — at or since is not a bution that time direct tax of sense the Constitution. of

The framers the Constitution proceeded upon theory writers of that entertained that by political there was day, relation, more or less direct, some between population But there no connection, land. is direct or be- proximate, of land and rents incomes of tween personalty popula- none whatever. did tion— not have relation They to any other the time each at the Constitution was nor have adopted, ever had since, never will have. perhaps it is settled well-considered authorities that Again, a on tax on rents and a tax land itself is not or double duplicate taxation. The authorities and in this England country that tax on rents and tax on hold a land are different things. Besides the to which I cases, have not time English is refer, to there case of well-considered strength Robinson v. The Penn. County St. 161, when Gibson Allegheny, was Chief Justice Court of Supreme Pennsylvania, that a tax on is rent not a tax on the land out of holding it which arises. In that there case was a 'lease in of cer- fee tain the lessee to all taxes on the premises, covenanting pay A tax laid demised was State both land premises. and the rent, arose whether the tenant, even under that was bound express covenant,, tax to pay the land itself. Court of held Supreme the State he was there were two not; and inde- distinct, separate, and that pendent his to covenant subjeots-matter; pay did demised not extend to the premises tax payment the rent the land All owner. the circum- charged upon against stances the formation and Con- surrounding adoption stitution lead to the conclusion that such tax as is laid as such, directly upon, to valuation or according ” “a tax assessment, direct within the true meaning Constitution. we cannot to attribute framers

Again, Constitu- tion an intention to make direct tax which impossible If cannot be apportion. without apportioned & TRUST POLLOCK v.. LOAN CO. FARMERS’ Jackson, Opinion: Dissenting it is a tax assured that never con- we feel injustice, may gross tax. No as direct there- tax, the-Constitution templated tax, as a- sense can fore, regarded the rule which is instrument, incapable apportionment by n numbers. The constitutional clearly provision implies a direct tax is such, requirement apportionment without as can be only, glaring apportioned inequality, those manifest and unfairness as between subject injustice, test most natural and burden. The practical .its what a direct tax the'sense Constitution determine the tax is to ascertain whether can apportioned among their rea- numbers, States respective several according to all fairness, sonable approximation justice, equality who of be citizens and inhabitants the sub- the country law. fact that the the The cannot operation ject to. and without be so producing gross injustice apportioned' it should the those to settle pay among required inequality n not a tax within the true sense and those words used Constitution. meaning Take the illustration Let us this test. apply suggested millions a tax of of the court. Congress lays opinion thirty a certain the incomes of the above country designated and directs that tax to be amount, apportioned among and States to their when so numbers, -several appor- according tioned to the citizens pro-rated amongst respective law. thé of the To two States States within coming operation n the same will be allotted. In amount equal population States there and in the other (cid:127)one of these are 1000 individuals to the tax. The under the former subject operation will be to twicethe rate apportionment required pay on the same amount of This latter income. disparity will increase as the numbers sub- just inequality proportion tax in the to the different differ or States vary. By way ject further illustration, take State new Washington State of the old Rhode about same Island, having popula- tion. To each would amount of the same assigned will assessment. In the we there are former, say, general law, 5000 citizens the latter subject operation, . TERM, 704.- Opinion: Rehearing. Dissenting. Jackson, J. The will be

50,000. citizen Washington ten required pay much times as as the citizen of Rhode Island on the same of taxable income. Extend amount the rule all the States, result that the the number of those larger subject of the law State, the operation any smaller given their of the tax and the smaller their rate of tax- proportion while, to the smaller number in ation, other respect will be their rate of taxation on the same income. greater But it is said that this was intentional inequality of the framers of the Constitution; that it was part adopted view to as a class. owners Where protect property find does such an idea or countenance under a Consti- support tution framed and “to adopted promote justice?” gov- ernment' is not with the States it is dealing matter;- with its own citizens dealing throughout country, irrespec- tive that the lines, of state which was say intended either in its whole inor promote peace justice, ever intended to work out thereof, such part result, discrimination and produce between the gross injustice citizens of a common all country, reason. beyond (cid:127) is to What be the end of the of this new rule application ? A tax is laid court adopted by general govern- ment on or on hand citizen money deposit every of at the a date. Such taxation government given prevails of the States. The under its government has, many taxing the such tax. When laid a few power, right lay parties and come before the court were derived say: My deposits of farm the or from the interest on proceeds products bonds and are securities, therefore, and taxable not, this law.” To make tax valid the must your you apportion of all the citizens the amongst according government, the the of the whole population respective taking out of the control of both the rate subject-matter Congress, of assessment, taxation and the it the upon imposing an rule which people country by arbitrary produces Í as have out. briefly pointed inequality In the announced in the decision my judgment principle to reach practically government destroys power FARMERS’ LOAN TRUST CO. Jackson, Opinion: Rehearing. Dissenting There is to real estate. mind incomes from personal my no real difference between little or existence of denying to tax incomes from real and personal estate, power such conditions and its exercise as attaching requirements of will render impossible incapable any practical oper- case ation. You as well strike at niight just .the to reach incomes from the sources indicated as to power attach these conditions of which no apportionment legislat- can ever if which, ure undertake to adopt, adopted, cannot be enforced with or fairness any degree equality between the common citizens of a common country.

The decision the well-established canon of con- disregards I that an act have referred, struction passed by has coordinate branch every government presumption in its and should never be declared invalid favor, courts its is clear unless Constitution repugnancy beyond It matter of reasonable doubt. is not a is the conjecture; that it must be clear established reasonable principle beyond cannot doubt. I view of how this see, case can past, be said to be free of doubt. not takes from decision its only Congress

Again, right- but taxation, ful rate substitutes a fixing without rule most mon- producing incapable application between citizens dif- strous inequality injustice residing such as ferent of their common sections framers’ country, could have Constitution never such as contemplated, the. can ever no free and sanction or enlightened people possibly approve. the decision is to disre- practical operation in taxation, but the further equality

gard great principles of taxes for the benefit of the imposition principle should be burdens thereof those imposed government bear them. This decision, most effect, ability having result, works out a citizens relieving directly opposite the burdens taxation while having greater ability, made to fall those most heavily oppressively upon having the burden the least num- larger ability. lightens it some States to tax, most un- ber, places ¡subject

vol. clvih —45 '706 TEEM,‘1894 OCTOBEE Opinion: White, Dissenting on smaller number in disproportionately other equally is, States. Considered all its decision bearings, my the most blow ever struck at the disastrous consti- judgment, an tutional It strikes down power important Congress. most vital and essential portion govern- ment recourse to incomes from any practically excluding estate for real needed rev- personal purpose raising to meet the enue wants and necessities under government’s circumstances. am therefore enter I dissent to the my compelled judg- of the court. ment

Me. 'Justice White dissenting.

I deem to elaborate reasons for unnecessary my adhering hitherto me, views and content expressed by myself statement of points: following the. 1st. the court held that the inclu- previous opinion real sion rentals from estate in income to taxation subject laid a direct tax on the real itself, estate therefore, was, void, unconstitutional and unless From this apportioned. posi- tion I on the dissented, that it overthrew the settled ground of the Constitution, construction in one hundred applied sanctioned and unanimous years practice, repeated decisions of this court, and theoretical and taught by every writer on the Constitution who expressed has philosophical an the subject. opinion upon

2d. The court in its considers that the present Con- opinion it to stitution extend the former requires further, ruling yet and holds that the inclusion of revenue from personal property income an taxation amounts to a direct subjected imposing unless, on tax which is also void, personal property, appor- tioned. As a tax income from real and personal property declared unconstitutional unless because apportioned, to a direct it follows that equivalent .is the decision novv'renderedholds that the rule of appor- must be an tax, tax, 'tionment income but also no applied indirect, on either whether real personal property can be or investments unless levied by apportionment. Every- v. FARMERS’ LOAN TRUST CO. ?07 White, Dissenting Opinion: in the dissent the decision said to the previous from thing applies I which, now and accentu- announced, think, aggravates ruling the court’s the settled construction ates departure the Constitution. court does

3d. The not in some now, re- except particulars, view advanced its conclu- the reasoning support previous therefore the render it does not sion, necessary opinion more than me to do refer views former expressed my to then dissent, the now taken and to applicable position the notice new matter advanced. briefly the on the issues been

4th.'As, however, have rehearing, I it deem also to the state elaborately argued, duty why my has in on no but the shaken, has reargument way contrary the convictions hitherto strengthened, expressed. reasons on

5th. The the me seem to to urged reargument involve a series of theories: contradictory

a. the that Thus, United States v. answering proposition cases which it, followed and Hylton have confirmed “ settled that the word direct,” as used the Constitution, táxes and taxes it is land, first applies only capitation contended that this claim is unfounded, and that nothing “ the kind so decided, was is then that argued century of.error” no should furnish the reversal, obstacle to court, a continuous line decisions consti- interpreting tutional of that if such decisions be considered meaning word, ” “ Whence the of error unless the wrong. evolved, century ” “ cases relied decided direct that word was not to be sense, in its considered economic' does from appear argument.

Inb. that proposition passage answer act and decision in carriage-tax case Hylton declared act constitutional, involved the assumption ” “ that the word consid- Constitution was to be ered as a tax on land and applying only capitation, is said that' this act view of the decision is and, faulty, therefore, is erroneous. At the inference deduced from it same time reference of Mr. Madison, made opinion that the of the Consti- carriage-tax act was violation passed TERM, Opinion:

Rehearing. Dissenting White, J. and hence the decision which held it tution, constitutional statesman was How could have distinguished wrong. . the act violated the considered how- which affirmed he could have decision its regarded validity the act and unless decision were not in erroneous, accord ” (cid:127)with his view word direct meaning argu- elucidate. ment also fails to called

6th. Attention previously fact that^practi- all the writers on the Con- theoretical eally philosophical act since the and the stitution, passed carriage-tax Hylton have declared the word ease was that “direct” in decided, on land to taxes the Constitution applies only capitation referred to, taxes. The list of with the writers, formerly others not then mentioned, addition of a few includes Kent,. of the historian the Constitu- Miller, Bancroft, Story, Cooley, Hare, Ordroneaux, Black, Farrar, tion, Pomeroy, Burroughs, Flanders, Bateman, Yon Holst. How is this Patterson, of consensus law and his- writers, publicists, overwhelming that, torians ? answered their not -By saying opinions ought to be because misled were all the they dieta regarded, by ease an into erroneous doctrine. the Hylton teaching if How, ease did not decide this direct Hylton taxation, — all could have misled these writers them some of among the noblest and intellects which brightest have adorned our — national life is not In in other explained. words, order effect the the act and the decision it is escape it, not, did that they by establish argued necessary implication, were that direct taxes land in taxes, and capitation the same order to breath, avoid force of the harmonious Constitution all the interpretation writers great who have it, we are told that their expounded views are were misled they worthless.because ease. Hylton (cid:127) as is all If, admitted, 7th. these authors have interpreted easeas taxes to land and Hylton confining capitation that their taxes, I submit instead of unanimity, affording for, foundation were misled argument furnishes much case, better and its safer as to what guide the contention now than does necessarily implied, decision LOAN & v. FARMERS’ TRUST CO. (cid:127) Opinion: White, .Rehearing. Dissenting are hold that these minds unless we were made, great led into decided as to be case so feeble concluding it did not and unless we that the true what decide, say to the of this “direct” word has regard meaning light no writer or thinker until now. come to time from (cid:127) it is admitted that in the discussions at the 8th. Whilst court when the were bar of this cases years previous past, reference was made the lines of it, before authority copious is advanced, are, arid that new now we here nothing urged, seem, at the same told as it the sources time, that, strange ” Constitution have been neglected up present and this is asserted in time; order supposed neglect justify the overthrow of an con- Constitution interpretation cluded the founda- enactments and decisions dating tion of the this of the sources of Iiow neglect government. the Constitution admission past compatible that, new is here advanced, nothing explained.

9th. and all Kent, Although Story, Cooley, opinions other teachers and on the Constitution are here writers the constitutional meaning disregarded determining “ direct,” word of some of same authors are opinions involved cited as conclusive other case. questions treated men should be these Why opinions great ” in worthless to one constitutional law, regard remains to dis- another, and considered conclusive on be covered. in other

10th. The same conflict positions presented views incidental Thus, of various respects. support court are of this we referred to many opinions questions, that we told all the time, at the are .conclusive, and, same down to the of this court from ease Hylton decisions if taxation are wrong case regard Springer- and must, land and capitation, limit the-word “direct” error” does “a be because therefore; century.of disregarded, not; the decisions of How suffice to determine question. to be cited court are authority this one settling principle to be time, that "for at the same it is arid, argued, principle, concurrent, unanimous and that other decisions, equally TLO TERM,

Rehearing. Dissenting Opinion.: "White, J. no for another authority principle, involves logical dilemma, which solved. cannot In it

11th. was contended before, that dissenting the pas- act of the and the decision of this carriage-tax court sage had been thereon and accepted by Executive Legislative from of the that this, branches time to and that government had been all taxes acceptance by conforming manifested to the rule of taxation thereafter thus established. imposed that there This is answered was no such by saying accept- the mere from because abstention the exercise of a ance, no affords indication an intention to disown the here consists action fallacy power. confusing It was reasoned in the inaction. dissent that not previous the lack of mere inaction but implied governmental power, definitive action in a that when construed particular way, connection with established a decision, continu- Hylton ous governmental interpretation. "Whilst that

12th. there has been rule evolved denying case and Ilylton for the applied by government hundred is said that the results of years, that case were past when enforced. How there could be no disputed rule, always of the the results rule could and is likewise a yet disputed, answered. difficulty The admission of the

13th. was necessitated dispute when, 1861, was a direct statement proposed levy tax, a committee of apportionment, personal the House under Eepresentatives reported Hylton not be could done. This if fact, case it fur- stated, accurately evidence best nishes the existence of the rule which the had established, case shows that the decision now Hylton pontention case, made reverses sustains the who voted minority against act, whose carriage-tax defeated its views were passage repudiated and have besides been it, overthrown decision unbroken the other history government of this court case. 'adjudications confirming Hylton The decision here announced the tax holding l£th. from real the income estate the' tax on the income from v. FARMERS’ LOAN TRUST CO. 711 White, Rehearing. Dissenting Opinion: investments, direct, therefore personal rests on the apportionment, necessarily proposition require ” “ direct that the word Constitution must be construed economic that is to sense; whether a be direct say, is indirect tested whether it is by ascertaining capa shifted from the one ble who it to being immediately pays If it an ultimate consumer. cannot be it so shifted, direct; be, if it can it indirect. But the word this sense applies income, to the not from real estate only personal property, but also to business gains, professional salaries,, earnings, all of the sources from which human evolves many activity or income invested without These latter the profit capital. holds to be taxable without opinion apportionment, upon “ taxes on them are theory excises,” do and, therefore, not decisions require apportionment according previous of this court-on the of income taxation. These decis subject v. United 3 Dall. ions, Hylton States, 171; Insurance Pacific Soule, v. 433; Wall. Co. Veazie Bank v. Fenno, Wall. 533; Rew, 23 Wall. Scholey 331; v. United Springer 102 U. S. hold that the word direct” in the Constitution to direct refers' taxes on land, therefore has a consti tutional different from the sense significance wholly given that word the economists. The now announced ruling overthrows these decisions. It also the economic subverts ajl of the word “direct” signification seemingly adopts. t Under tha on taxes business meaning, gains, professional and salaries are as much earnings, indeed, even direct, and, so, more than would be taxes invested personal property. It I follows, submit, that decision now rendered accepts rule and at once overthrows it. In other words, part result of the conclusion is to decisions necessary repudiate of this court, previously rendered, they ground the word it its eco misinterpreted “direct,” giving nomic sense, and then to decline to sense follow economic because of the decisions. previous Thus adoption economic meaning word decisions, destroys in turn follows, the rule established. seems destroy me, that the conclusion now announced rests neither upon TERM, 1894 Opinion: White,

Rehearing. Dissenting “ ” direct the sense of the word the economic constitutional it must of that But rest one or term. the significance on it sustained. to Besting neither, has, to be other my in reason whatever. no foundation mind, in the This contradiction 15th. to strongest way points late to be the error at this I conceive what changing, day, It demonstrates, of the Constitution. I construction a settled have the cases determined how think, conclusively previous this, involved shows the doctrine every question ” laid that the word direct the now down Consti- be cannot to be economic sense, is tution interpreted maintained. consistently the conclusion error the,

16th. The injustice points wealth it takes and reads into it. invested the adopting a favored and class protected Constitution it whilst be taxed without leaves apportionment, which cannot the minister, the doctor, of the the professor, the occupation author, inventor, merchant, mechanic, lawyer, forms of which the other industry upon and all prosperity condi-, taxation without that must depend, subject'to a people this out seems result, which, rule which works A tion. it an instrument the Constitution by making stultifies me, not be should most wrong, adopted, grievous especially the decisions of to do this so, court, in order opin- when, law writers and tradition, publicists, ions of practice, of the must over- the settled government policy thrown. Nor conclusion wrong, involves,

17th. contention that the doctrine of apportion- by mitigated to indirect as well direct taxes now here ment applied estate, invested leaves real personal property, to reach such property ample power government and make it bear its burdens. part taxation, just public this, instead of doing really deprives On contrary, at all, to tax'such because ability government tax, the rule of held, now must be 'the it is appor- imposed The absolute tionment according .population. inequality wealth reference taxing population injustice FARMERS’ LOAN TRUST CO. J, White, Dissenting Opinion: amount' of the taxed are so wealth without regard should not be extended that .this beyond manifest system it to taxes on whiohsconfines real rule estate. settled the fixed To interpretation destroy -rule of

which the according population, apportionment on real estate so as to to direct taxes that rule confined make taxes on real estate and whether direct taxes, include indirect indirect, stocks, etc., invested bonds, personal property, into the Constitution most reads flagrantly unjust, unequal, of taxation known to civilized system any wrongful strikes me too clear for I This as argument. government. conceive of no than would result can injustice greater million in one State, one having only imposing people millions invested the same amount wealth, ten of tax as like on the number of another State imposed people amount times that of invested wealth. The having fifty ap- rule of of the apportionment by. population plication wealth would not out invested work personal only wrong, but would a self-destructive from the ultimately prove process, such which its situs. If so facility property changes of this character would soon be. taxed, transferred property to the States sum where the accumulated wealth was great- est and- where therefore the proportion population, burden of taxation would and thus the lightest, mighty from the nature of the extension of very wrong resulting rule would It is clear I that the then, think, aggravated. of taxation to invested admission power regard per- sonal with the restriction that the tax must property, coupled be distributed involves a wealth, by population substantial itself, denial- of the because condition its To renders can say exercise practically impossible. thing t>é done in about -a must only necessarily bring way the existence of is to admit grossest delusively wrong, And the while it. power, substantially grievous denying results sure such a to follow from attempt adopt, fail to if are so mind cannot see that obvious that system my a tax on were the rule invested imposed by personal property means of were no other there population, preventing TERM, Opinion: White, Dissenting the red enforcement,

its revolution spectre would shake our institutions, to their foundation. 18th. This demonstrates the of the fallacy proposition of the Constitution now announced interpretation concedes to the national means to sustain itself government ample in an taxation extraordinary leaves emergency. excise taxation,, and the direct or

tariff impost, indirect the vital of the which, on. as I taxes energies country, have now holds are not to the rule of said, opinion subject In war, case foreign apportionment.' embargo, blockade, other international the means of complications, support would from tariff taxation none the accumulated disappear; could be invested country reached, except 'rule of according apportionment; ^impracticable taxation on real estate even indirect would be unavailable, now announces that the rule of the opinion apportionment indirect, an a direct tax on well applies property. would thus be government practically deprived n meansof support.

19th. The claim that the States the amount pay tax and thus save the to their injustice citizens apportioned enforcement, from its not render does resulting conclusion In hurtful. the first the fact less that the place, State may no the sum lessens .apportioned the pay way evil, because assessed and tax, the being by population wealth, must, hpwever which I operate have paid, injustice stated. just the contention that a Moreover, State could of by payment sum of a the whole tax on personal property, apportioned to relieve the according population, citizen grievous his, result to from its enforcement (cid:127)wrong against property, an admission of collection such tax against of the citizen, because of its would be injustice, ' If of impossible. enforce- practically substantially impossible ment be citizen’s it would so as against equally no State, there would be on the obligation against and thus there would be no State to whatever to pay, power Hence, rendered, so decision now far as enforce. taxing wealth invested is concerned, real and personal property . FARMERS’ LOAN TRUST CO. (cid:127) White, Opinion: Dissenting of the United States . reduces government para- existed condition which under the lyzed Confederation, which the to remove the United' States was Constitution adopted. that, The if 20th. the construction suggestion now adopted, about court, brings can be results, cured hurtful to an amendment the Constitution instead of sustaining conclusion shows its reached, case was fallacy. Hylton more than one decided hundred The income years ago. were

laws enacted past also At the time ago. years were the debates and they passed, show reports conclusively were made conform the rulings Hylton Since all case. these done, were things Constitution has been These amended. repeatedly followed .amendments the civil war, were for the adopted purpose supplying defects the national it be doubted that Can if an power. intimation had been the décisions of this court conveyed would or overruled, could so as deprive government of an essential taxation, amendments would have power a ? The ruling impossible rendered change adoption none of which the uniform of the amendments, repudiated ratification practically policy government, settled rule of and an interpre- acquiescence policy tation theretofore adopted. more, after that, submit,

21st. I is, deplored greatly existence, national after the one our than hundred years wars and the withstood the strain foreign has government have civil its become united strife, dread ordeal of people should consider court itself powerful, compelled back to Con- long repudiated rejected theory go of an stitution, which inherent government deprived attribute of its being, necessary taxation.. notes cent d state banks hel banks, national Fenno, Veazie v. 8 Wall. 533; a tax devolution real estate, Scholey v. Pew,

Case Details

Case Name: Pollock v. Farmers' Loan & Trust Co.

Court Name: Supreme Court of the United States

Date Published: May 20, 1895

Citation: 158 U.S. 601

Docket Number: Nos. 893 and 894

Court Abbreviation: SCOTUS