Читать книгу The Essentials of American Constitutional Law - Francis Newton Thorpe - Страница 8

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40. In our system of government [observes the Supreme Court], it is oftentimes difficult to fix the true boundary between the two systems, State and federal [and, adopting the words of Chief Justice Marshall, proceeds],—endeavoring to fix this boundary upon the subject of taxation, if we measure the power of taxation residing in a State by the extent of sovereignty which the people of a single State possess, and can confer on its government,—we have an intelligible standard applicable to every case to which the power may be applied. We have a principle which leaves the power of taxing the people and property unimpaired; which leaves to a State the command of all its resources, and which places beyond its reach all these powers which are conferred by the people of the United States on the government of the Union, and all these means which are given for the purpose of carrying these powers into execution. We have a principle which is safe for the States and safe for the Union.100 We are relieved, as we ought to be, from clashing sovereignty.

It follows that the powers and functions of the two governments can be harmonized “only by a wise and forbearing application of this principle.”101

41. A tax is a burden or charge imposed by the legislature on property or persons to raise money for public purposes.102 The two essentials of a good tax are that it is to be laid for a public purpose and by authority. The exercise of the taxing power not only distinguishes sovereignty but also the government which sovereignty creates by delegation of power. But the State cannot exercise taxing power beyond its jurisdiction,103 a limitation parallel to the limitation of the sovereignty of the State, that is, a version (however unphilosophical) of the idea in the phrase “residuary sovereignty.”104 But unless restrained by the federal Constitution the power of Congress as to mode, form, or extent of taxation is unlimited.

The test here is jurisdiction.105 Taxation is the correlative of protection. As the State cannot protect so it cannot tax beyond its jurisdiction.106 Thus the person or the property must be within the jurisdiction of the State to bring either within its taxing power. Tax laws can have no extra-territorial operation,107 but there is no established limit of the taxing power or to the selection of objects to which it is applicable.108

42. A State Legislature may abuse this power, but the Constitution of the United States was not intended to furnish a corrective for every abuse of power committed by the State governments. Relief lies wholly with the electors within the State who, if the State constitution does not afford security against unjust taxation and unwise legislation, can both alter the State constitution and elect other legislators.

So long as the State by its laws, prescribing the mode and subjects of taxation, does not entrench upon the legitimate authority of the Union, or violate any right recognized, or secured by the Constitution of the United States, the (Supreme) Court, as between the State and its citizens, can afford no relief against State taxation, however unjust, oppressive, or onerous.

The discretion of the State,—that is, of the State Legislature, is beyond the power of the federal government, or any of its departments, to supervise or control.109

43. The fundamental idea in America is that each government—the State, the national—possesses powers and functions adequate to its own ends and purposes. Thus the State has no power to lay a tax on any constitutional means employed by the government of the Union to execute its powers, otherwise, by taxation of such means or agencies,—say the mail, the mint, judicial process, patent rights,—the States might defeat all the ends of the national government,—a design not intended by the people of the United States.110 But this protection of government is not limited to the United States by limiting the States; it applies to the States as limiting the United States.

The sovereign powers vested in the State governments by their respective constitutions, remain unaltered and unimpaired, except so far as they were granted to the government of the United States.111 As the powers not delegated were reserved to the States respectively, or to the people, the government of the United States can claim no powers not so delegated, and the powers actually granted must be such as are expressly given, or given by necessary implication.

In our complex system, the existence of the States in their separate and independent condition

is so indispensable, that without them the general government itself would disappear from the family of nations.112 Whence the necessary conclusion that the means and instrumentalities employed for carrying on the operations of their governments (the State governments), for preserving their existence, and fulfilling the high and responsible duties assigned to them in the Constitution, should be left free and unimpaired, should not be liable to be crippled, much less defeated by the taxing power of another government, which power acknowledges no limits but the will of the legislative body imposing the tax, and more especially, those means and instrumentalities which are the creation of their sovereign and reserved rights, one of which is the establishment of the judicial department, and the appointing of officers to administer the laws. Without this power and the exercise of it, no one of the States, under the form of government guaranteed by the Constitution, could long preserve its existence.113

44. One of the reserved powers of the States was to establish a judicial department.

All of the thirteen States were in possession of this power, and had exercised it at the adoption of the Constitution; and it is not pretended that any grant of it to the general government is found in that instrument. It is therefore one of the sovereign powers vested in the States by their constitutions, which remained unaltered and unimpaired, and in respect to which the State is as independent of the general government as that government is independent of the States. In respect to reserved powers, the State is as sovereign and as independent as the general government.114

The means and instrumentalities employed by the one government to carry its powers into operation are as necessary to its self-preservation as the means and instrumentalities are necessary to the other. Unimpaired existence is as essential to the one as to the other. There is no express provision in the Constitution that prohibits the general government from taxing the means and instrumentalities of the States, or prohibiting such taxation.

In both cases the exemption rests upon necessary implication, and is upheld by the great law of self-preservation; as any government whose means employed in conducting its operations, if subject to the control of another and distinct government, can exist only at the mercy of that government.115

45. This was the constitutional law of the United States as settled in 1870,116 the case arising in Massachusetts; the plaintiff a judicial officer of that Commonwealth having brought suit to recover from the United States Revenue Collector the amount of income tax exacted from him, it being part of his salary as a judge in that Commonwealth. The Supreme Court of the United States sustained the plaintiff for reasons given in the opinion, part of which has been quoted. By parity of reasoning, as followed in that decision, any act of Congress imposing a tax on the salary of any State officer, if his office is a means and instrumentality employed by the State to carry its powers into operation must be declared unconstitutional. In 1913 the Constitution was amended so that “The Congress shall have power to lay and collect taxes on incomes from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”117

Does this amendment increase the taxing power of Congress beyond that power as possessed prior to 1913 and as limited by the Supreme Court in its decision in the case of The Collector v. Day? If any officer of a State, executive, legislative, judicial, or administrative, receives a salary, large or small, (and it forms part of his income) is it beyond the jurisdiction of the United States as a taxable estate, despite the explicit power of Congress, in this Sixteenth Amendment “to lay and collect taxes on incomes, from whatever source derived?” Does the amendment overrule the decision in The Collector v. Day?118 Evidently the amendment empowers Congress to levy an income tax wholly in disregard of the effect of the tax in impairing the “necessary means and instrumentalities of a State.” Here too the issue is one of jurisdiction. The person taxed being within the jurisdiction of the United States has no redress against that jurisdiction more than has a person, taxed and being within the jurisdiction of a State, redress against the State. But can the Commonwealth of Massachusetts, or any other State, imposing an income tax, lay and collect it from whatever source derived, and that source be the treasury of the United States,—that income be salary received by a citizen of the State who also is a federal official, say a federal Judge, or a Collector of the Revenue, or a United States Marshal, or a Senator of the United States, or a Congressman, or the President of the United States?119

46. In the operations of government, the delegation of authority by the executive, the legislative, or the judiciary is rare. The constitutional test, in either case, is purpose and authority. Thus a municipal corporation is a representative not only of the State, but is a portion of its governmental power. It is one of its creatures, made for a specific purpose, to exercise within a limited sphere the powers of the State. “The action is no less a portion of the sovereign authority when it is done through the agency of a town or city corporation.”120 Thus a tax authorized by the State Legislature, to be imposed by a municipal corporation is a good tax in law, provided it is for a public purpose. This is not a delegation of the taxing power, but is the exercise of it by the Legislature. The municipality itself has no power to tax, or even to be a municipality, save by authority of the State, usually by the constitution, vested in its Legislature. The amount of the tax, the subjects of taxation, the method of assessment and of collection are wholly within the discretion of the Legislature. The exemption of churches, schools, colleges, and charitable institutions may or may not be required by a State constitution. If this is silent on the subject, the question is wholly one of legislative discretion. A charitable institution has no fundamental right to exemption from taxation, as a person has a fundamental right to “due process of law.”121 The principle of exemption from taxation is that taxation of the person or the property tends to destroy the powers or to impair the efficiency of the State.122

47. A tax must not only be laid by authority but it must be for a public purpose. Thus any assessment imposed upon persons or property by the government, State or federal, for the gain, emolument, or advantage of a private person, or an official, is unconstitutional. The purpose must be public, as for example, for schools, highways, canals, public buildings, markets, asylums, jails, or to keep the same in repair and to use them for public purposes. The Legislature cannot authorize a town or a county, or any subdivision of the State, to raise money for other than public purposes and uses. It cannot confer benefits on individuals, however meritorious, by taxation.123

48. Taxes, imposed under the Constitution, have been classed as direct or indirect,—the direct being apportionable among the States according to population; the indirect being uniform throughout the United States.124

The Sixteenth Amendment of 1913 abolishes the limitation of apportionment or enumeration in the imposition and collection of an income tax. The Income Tax law of October 3, 1913—the first of the kind enacted by Congress under the amendment—exempted incomes of $3000, or less, or $4000, or less, as the person taxed may be single or married. The amount of the exemption is fixed at the discretion of Congress. So too is the rate of taxation by duties, imposts, and excises, as well as the inclusion or exclusion of articles subject to them, but Congress must make such taxes uniform throughout the United States.125

The taxing power may be used to encourage or to discourage an activity, or to destroy it. As thus used, the exercise of the taxing power, whether by the State or by the United States, may characterize the policy, or administration of its government. So too if a State engages in manufacturing, or in any activity or occupation taxable under federal revenue laws, it is amenable in taxes like a private person.126