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TF.s SUMTER WATCHMAN, Established Aprii,.l850. "Be Just and Fear not-Let all the Ends thou Aims't at, be thy Country's, thy God's and Truth's." THE TKUE SOUTHRON, Established jane, 1366 Consolidated Aug. 2,1881. SUMTER, S. C., "WEDNESDAY, APRIL 17, 1895. . New Series-Vol. XIV. No. 86. tl)t W&t?l?xm bouillis Published E?ery Wednesday, -BY J>3\ G-, Osteer SUMTER, S. C. TERM3 I Two Dollars per annum-in advance ADVERTISEMENT: One Square first insertion.Si Every subsequent insertion. Contracts for three months, or longer w be made at reduced rates. AU communications which subserve priv; interests will be charged foras-advertisemen Obituaries and tributes of respect will charged for. The Plutocrats Rejoice. The Supreme Court Decide Against the Legality of the Income Tax Law. WASHINGTON, April 8.-The ai nouncement of the decision of tl Supreme Court of the United States the income tax cases to-day was mac io the presence of a crowded cou room, the spectators' lobby bein thronged t6 its utmost capacity. Ti members of the court, except Mr. Assi ciate Justice Jackson, entered tr. chamber promptly at noon. A fe cases of minor importance were di posed of and the Chief Justice aonoam ed that at the conclusion of the sittin on Thursday, the court would adjour over Good Friday and several orders c the court, after which the great, case c the day was read by him. He saic amid al mose painful stillness: "I ai charged with the duty of annouocin the opinion and judgment of the com ia the case of Chas. Pollock vs. th Farmers Loan and Trust Company e al." The conclusions of the court wer stated to be as follows : 1. That by the Constitution, Feder? taxation rs divided into two gres classes : Direct taxes and duties, im ports and excises. 2. That the imposition of direc taxes ia governed by the rule of ap portion ment among the several States according to numbers, and the impost tioo of duties, imports and excises b; the role of uniformity throughout tbi United States. 3. That the principle that taxatioi and representation go together was in tended to be and was prescribed in th Constitution by the establishment o the rule of apportionment among th several States, so that such apportion ment should be according to number in each State. 4. That the States surrendered theil power to levy imports and to r?gul?t* commerce to the'general government and gave it the concurrent power t( levy direct taxes in reliance on the pro tection afforded by the rules prescribed and that the compromises of the Con? stitution cannot be disturbed by legis lative action. 5. That these conclusions result from the text of the Constitution and are supported by the historical evidence furnished by the circumstances sur? rounding the framing and adoptioo ol that instrument and the views of those who framed and adopted it 6. That the understanding and ex? pectation at the time of the adoption ol the Constitution was that direct taxes would not be levied by the general government except under the pressure of extraordinary exigences aid such has been the practice down to August 15, 1894. If the power to do so is to be exercised as aq ordinary and usual means of supply, that fact furnishes an additional reason for circumspection io disposing of the present case. 7. That taxes on real estate belong to the class of direet taxes aod that the taxes on the rent or income of real es? tate, which is the incident of its owner? ship, belong to the same class. 8. That by no previous decision of this court has this question been adju? dicated to the contrary of the conclu? sions DOW announced. That so much of the act of August 15. 1894, as attempts to impose a tax upon the rent or income of real estate without appor? tionment is invalid. The court is further of opinion that the act of August 15, 1894, is invalid, so far as it attempts to levy a tax upon the in? come derived from muncipal bonds. As a municipal corporation is the repre? sentative of the State and one of the instrumentalities of the State govern? ment, the property and revenues of municipal corporations are not subjects of Federal taxation, nor is the income derived from State, county aod muni? cipal securities, since taxation on the interest therefrom operates on the power to borrow before it is exercised and has a sensible influence on the con? tract, and therefore such a tax is a tax on the power of the States and their instrumentalities to borrow money, aod consequently repugnant to the Coo stiutioD. Upon each of the other questioo ar? gued at the bar, to wit : * , 1. Whether the void provisions as to rents and income from real estate in? validates the whole act? 2. Whether as to the income from personal property as suob, the act is unconstitutional as laying direct taxe 3. Whether any part of the tax, not considered as a direct tax, is i valid, for want of uniformity on eith of tbe grounds suggested ?-the justic who heard the argument are equal divided and therefore no opinion is e pressed. The result is that the decree of t' Circuit Court is reversed and the eau remanded with directions to enter decree in favor of complainant io r specfc only of the voluntary payment the tax on the rents and income of i real estate and that which it holds trust, and on the income from the m nicipal bonds owned or so held by ir.. The Chief Justice said that the Juri diction of courts of equity to prevei diversion of funds by breach of tru or illegal payment of the funds h? been frequently affirmed by the cour The question was not raised iu tl court below, but had been expliciti waived on the argument of the ca? and the court felt justified in proc?c< ing to a decision of the case on i -- merits. He said that the power to d; cide a law uoconstitional Was use with reluctance, but the responsibilit could not be evaded when the necei iity arose. The contentions respectin this law were: 1. That a tax OD rew was a tax on rea1 estate and that n< being laid according to apportionmet it was invalid; (2). That it was not uu form and a vioiation of the constitr, tional requirement that such tax? shall be laid with uniformity. Ucde this head, came the exceptions iu fav?, of those persons who were not in po. session of an income of ?4,000; of OJU tual insurance companies, saving banks and partnerships, ail organize for and doing the same business as tba of corporations authorized by th States. These exceptions, it was held were arbitrary and capricious and no based apon souod public policy; (3) That income* from investments i: State and municipal bonds could not b taxed. The Chief Justice proceeded to a con sideration of the constitutional require meats with respect of the imposition o two forms of taxation., direct and indi rect, and said that the framers of th Constitution intended to make tin consent of those who were expected t< pay, essential to the validity of ao^ tax They had just come out of a coo flic; upon the great principle of taxa tioo without representation and the] were intended to go together-tha Congress should KO impose a tax that i would fall with eveo force'and effec upon all of the constituents of thosi who voted for it. Tue States repre sented in the constitutional convention said the Justice, surrendered theit right to levy imports, excises and duties to the government. They look? ed forward to the time whee greai States to the west of* them would bc coming into the Union and wheo thej gave up that right, they did so with con fidence ?bat the rule of uniformity would be observed in the laying ol taxes by the Congress. The first question to be considered, said Chief Justice Faller, was whether or not a tax OD rents is a direct tas witbio the meaning of the Constitution, It had always been held, he said, that a tax co estate, real or personal, was a direct tax, bat it might be that the Constitution had a different meaning, and that it was to be applied to tbie case ID that view, it became neces? sary to inquire what were direct taxes at the time the Constitution was adopted. The Chief Justice theo made extensive quotations from the history of the debate io the convention OD the subject of taxation The iofereoce from them, he said, was that the gen? eral distinction between direct aod in? direct taxation was well understood by the members of' the convention aod that the expectation was that a direct tax would be the last resort of Con? gress. The celebrated case of Ryton vs. the United States, decided March 3, 1796, was theo referred to at great 'length, the one io which it was held that a tax OD carriages was Dot a direct tax. Thc several opinions filed by the justices were quoted aod Mr. Chief Justice Faller asserted that io none of them was there any expression of opin? ion as to whether or not anything ex? cept land aod capitation taxes was a di? rect tax, but they were confined to the case at hand. The case, be said, seemed to tarn upon the declaration of Hamil? ton as to what constituted direct taxes. If there had been a refereoce to the de? cisions of the country from which the United States derived its jurisprudence it would have beeo fatal, for io Great Britain income taxes had always beeo treated as direct taxes. ? The opinion then proceeded to review the decisioDs made by tbs Supreme Court io cases arieiog under the law of 1861. which, the Chief Justice naid, counsel had contended declared that an income tax was not a direct tax, and must be regarded as controlling io the case under review. The principle of stare decisis, he continued, applied only to cases as are directly in poiut. No court had ever held itself bound by any part of a decision nor necessary to decide the case before it. The duty of any court charged with the construc? tion of constitutional provisions was oot to exteod a decision io a question if an error of principle was lil thereby to be perpetuated or corni ted. In the light of these observatit the opinion considered the decisi down to that, in the Springer case, concluded that they were? all dis gui>hable from the oce in hand. ' Springer case was no exception to rule, ioasmuch as it did not present point raised in this case. I3 a tax rents, a tax on real estate. The co the opinion continued, was unabli see any distinction between a tax real estate aDd a tax on the rents a ing from such real estate. What is I? but the iocome thereof? was ask The constitutional requirement ' that direct taxes should be laid only apportionment among the States cording to population, and this tax 1 a direct tax. There was no distioct betweeu an annual tax on the value the land and a tax on the land its Constitutional provisions it was sa could not be thus evaded ; it was substance, and not the form or shad that was to prevail in construing the Upon this point there were maDy 1 cisions and some of them were quoti "What the Constitution intended prevent," said the Chief Justice, "v that no tax should be laid on the re dents of any State by the represen lives of other States." The exercise the power to levy taxes was to be 1 stricted to extraordinary occasions. In conclusion, therefore, upon tl point, the Chief Justice announced tl: the court were of the opinion that tl part or lue law imposiug taxes up rents obtained from real estate was valid. Next io order, the opinion consider the third objection to the law-that imposed a tax upon the incomes deriv from investments in State and muni pal bonds, and was therefore invalid. Chief Justice Fniler reasserted t general principle that a tax on gover ment bonds was held to be a tax 1 contracts, and prejudicial to the pub interest. It was therefore obvious th such a tax on the power of States municipalities to make contracts w prejudical to public policy and tberefo unconstitutional. On the other matters involved in tl case of Hyde vs, the Continental Tru Company of New York city, and in tl case of John G. Moore vs. Joseph I Miller, commissioner of internal rev nue, for an iojuoctios to restrain the from proceeding to carry out the lav appealed from the courts of the Di trict of Columbia, Chief Justice F?lle 6tated that the court wai equally divu ed. The judgment of the lower cour as far as it related to the payment 1 the tax on rents and State and munie pal bonds, was reversed. In the Mooi case, the effect of the court's action to affirm the refusal of an iojuctio agaiost the commissioner of interns revenue. Justices Field and White read inde pendent dissenting opinions. Justice Field devoted some time to review of the provisions regardin rents, and denounced the priocipl sought to be established by the iocom tax law. Many of his conclusions wer in conformity with those expressed b the Chief Justice. He also atracke? the law 00 account of its lack of unifor mity and dwelt upon its exemptions an ! the many discriminations found therein ! Taking up the exemption of mutual io ! surance companies, be declared tba they were conducted 00 lines id?ntica with those on which large corporation ! were conducted-for the mutual bene fit of stockholders. He inveigbec against the exemption of saving an< building associations, which were no charitable institutions, but cooductec for either money-making or money-sell ing. All these exemptions stamped th< law as cla68 legislation of the most pro? nounced character. The law violatec every right and comity guaranteed under the Constitution. That there should be aoy doubt about the subject surpassed his comprehension. If the census figures did not oonvince one ol the magnitude and injustice of the ex? emptions granted, be did not think Congress could be convinced, "though ooe rose from the dead" to convince it. The law was also invalid in that it levied a tax upon the salaries of the 101 judges of the United States, many I of whom received small salaries. If the provisions of the Constitution could be set aside by the arbitrary act of Con? gress, where, be asked, would this power eod ? It was but a stepping stone to other and greater acts that would eventually open the way for a war between the poor and the rich. Such a power assumed by Congresses and permitted to go unchallenged, would make the hour when tbe deca j dence of the nation would commence. If the limit by the exemption could be ! fixed at ?4,000, future Congresses ! might fix it at $15,000 or $20,0U0, ! thus compelling one class alone to pay the tax. Or the limit might be fixed ? at su eli an amount an a board of walk? ing del?gales might determine to be I necessary. Io conclusion, Justice Field an ' nounced his opinion that thc whole law j of IS94 should be declared to be uull j and void. Justice White prefaced his disscnt ; ing opinion with the statement that the I custom of rendering long d'.jents in a court of last resort was more honored in the breach than in the observance. Their only effect was to weaken the efficacy of the opinion nf the court. Jus tice White said he should not speak to-day, but for fthe fact that the court had overruled and set aside established precedents and the settled and uniform doctrine of the Supreme Court down to the present time. He regretted at thia late day, the court should thus over? throw and nullify an act of Coogress, supported and affirmed by all text writers and by every decision of the Supreme Court of the United States. When the fathers construed our form of government, they gave it, not limited, but unlimited power to levy taxes, with but one exception-that of taxing ex? ports. The assertion that the constitu? tional power of Congress was limited, he thought, the fundamental error io the reasoning of the majority of this court. The great question before the court was "ls the income tax a direct tax?'' Thal; question was practically decided a hundred years ago and he did not deem it necessary to enter into an elaborate review of the cases that had been decided. In briefly reviewing the case presented to the court, he observed that the arguments made and the cita? tions used in this case were the came as those brought out in the Hyton case and now this court was asked to again take up the question adjudicated by a unanimous court a hundred years ago. Justice Harlan was of the opinion that a tax upon gains, profits and in? come derived from the rent of lands was not a direct tax: that under nu? merous decisions of this court the in? come derived from municipal bonds ? was not tue subject of specific taxation in any form by the United States. In other matters, he was in accord with Justice White. At 2.35 the court concluded the read? ing of the opinion. Upon the question of the constitu? tionality of the taxation of incomes of State and municipal bonds, the court was unanimously ir. the negative. Upon the question of taxation of rents the court stood as follows : Affirming Justices Harlan and White. Against the law-Chief Justice Fuller, Justices Field, Gray, Brewer, Brown and Shira8. Upon the question of the constitu? tionality of the law, the court is said to be divided as follows : For the law Justices Harlan, Brewer, Brown and WThite. Against the law-CSief Jus? tice Fuller, Justices Field, Gray and Shiras. Hill is Happy. .The Senator Jubilant at the Maiming of His Pet Abomi? nation. WASHINGTON, April 3.-Senator Hill of New York, who, more thao any one else, antagonized the enactment of the income tax law wheo it was before the Renate, was an interested spectator and close listener in the court room when the opinion was banded down to-day. His preseoce was acci? dental, however, as he was called here from Albany, N. Y., to argue a New York case that was on the calendar for to-day. He is greatly pleased at the result of the, case and discussed the effect of the decision. "I was naturally gratified/' he said, "at the decision of the court by a vote of 6 to 2 on two importaot questions involved io thc act. They are both questions I had carefully coosidered and vigorous? ly pressed io thc Senate amoog other objections to the law. For myself, I have never had any doubt that the tax imposed by the income tax law is a direct tax in all its features and, hence, an unconstitutional tax. I naturally thiok the opinions of Justices Fuller and Field are very able and convincing and will receive the approval of the bar throughout the United States. There never was any good reason for the eoactmeot of the iocome lax law It was pressed upon Congress by a lot of Populists, socialists, cranks and distur? bers and their views were unwisely adopted. It was class legislation of the worst kiod. From apolitical poiot of view, it was the height of folly to adopt legislation of that character. It had never beeo laid down as a Democratic priociple, nor adopted io any platform. It was foisted OD the party in an effort to get votes from a class of people who did Dot vote the ticket in conseqceDce of our adoptioo of the law, aod never will. It antagonized the business com? munity, delayed the adoption of a tariff reform bill and has injured the Demo? cratic party ever since. The effect of the decision, will, in my judgment, be j excellent for the country. I have no '< question but that the whole act will eventually be declared unconstitutional, j The first aot of the next Congress .should be to repeal the law and atone for our bluoders ; unfortunately the Republicans will get the benefit of the repeal, lt would be the most ?uprcme folly ou the part of the Democratic party to attempt to maintain an iocome tax law, now when some of its princi? pal features have already been declared to be unconstitutional, by a vote of 6 to 2, aod wheo the whole act is believed to be iovalid by at least ooe-half of the judges who heard the argument. The true policy for the country aod the Democratic party to pursue is to let the general government collect its rev? enues by tariff taxes and a limited amouut of internal revenue taxatioo strictly so-called-and perm t the States to impose direct taxes. '?The invalidating that part of the law applying to income derived from rents is far reaching in its consequences. It will materially reduce the revenues expected aod deprive the act of one of the principal arguments advanced at the time in the favor of its passage, vix : To reach the rents derived by owners of real estate who reside in foreign countries. The law is unjusti? fiable and un-democratic aod I rejoice that it has met at least a portion of its death blow : the rest will follow io due time." Referring to the State be represents, Senator Hill continued : "The decision is cf great benefit to the business in? terests of New York State.' The amount of mun icipal bonds held by the corporations and citizens of New York is enormous. I do not recall the figures, but I have seen the aggregate stated assuming* more than ?100,000, 000. The decision relieves them from the payment of the tax on the income from these investments. The decision relative to municipal bonds, being placed on the ground that the munici? pality is an instrument of State govern? ment, virtually decides that railroad and other corporations which pay the State of New York (and some other States) a certain part of their earnings for the support of the State government, are not taxable under the income tax law. The railroads and other corporations are created by the State, not the gen? eral government, aod the taxes are special taxes used for the government and are just as much an instrumental? ity of State government as is a State ! bond, a municipal bond or any other j means which tne State has created for I the purpose of raising revenue.'' Japan's Terras of Peace. Seven of Eight Conditions Ac? cepted by LI HUD g Chang. WASHINGTON, April 10.-The cable announcement that seven of the eight Japanese conditions have been accepted by Peace Commissioner Li Hung Chang is very grat:fying to diplomats here, who have no longer aoy doubt that a peaceful termination will speedily result. As understood in Washington the eight conditions were as follows. 1. Independence of Corea. 2. Cession of Formosa. 3. Cessiou of Lian ToDg Promontory iocluding Port Arthur. 4 War indemnity. 5. Admission of machinery into China and permisssion to foreigners to establish factories. 6. Modification of likin tax and exten? sion of system of transit passes for im? ports. 7. Opening certain Chinese riverg to commerce, including the Yang-tse-Kiang to Chung KiDg, the &iang from Han Kow on the Yang-tse to Siang Tan Ki ang, Canton River to Ouachow and WoosuDg and its canals as far as Suchow and Hang Chow. 8. Railway privileges and similar con? cessions to Japanese and foreign capi? talists. In adition to these conditions it is be? lieved certain promises have heeo or will be exacted from China, the terms of which are to remain secret. The condition which, it is thought, has not yet beeo accepted by Li Hung Chang is that numbered three above, provid? ing for thc occupation of a portion of the territory known as the Regent's Sword and Citadel of Port Arthur. That this would be most strenuously op? posed by China has all along been un? doubted, and it has been predicted that it might prove a stumbling block of such dimensions as to prevent peace unless gome compromise could be agreed upon as to the length of occupa? tion, the'Cbinese being likely to insist that it should not be permanent. All other conditions, except that of in? demnity, have been the subject of diplo? matic consideration for many years, and all treaty Powers are as deeply interest? ed tn them as Japan bag been. The United States have been particular? ly active in urging the abolition of the likin tax, which is not unlike the octroi j of Prance, though less reasonable and lest limited than the French system. The independence of Corea has always been in contention, and the United States have firmly maintained that Corea was ro be treated as an independent nation pince her minister at Washing? ton was recognized ten years ago. Highest of all in Leavening Pen The Income Tax. Commissioner Miller Issues Final Instructions. WASHINGTON-, April ll.-Commis? sioner Miller today, arter several days consideration of the changed condition of the income tax law, but still in the absence of the full text of the Supreme Court decision, issued supplemental instructions to the sixty-three internal revenue collec? tors. These instructions may be followed by others to meet special cases as they arise. The instructions were handed to the Southern Asso? ciated Press for distribution, and will not be telegraphed to collectors of internal revenue except in the far West. They are as follows : 1. Interest received from State, county and municipal bonds or secu? rities, and rents from real estate, are not taxable as income, but persons or corporations receiving said interests or rents shall include in their returns as receipts the full amount thereof received or accrued within the year for which the return is made and shall deduct the same as not subiect to taxation. 2. The amounts actually paid for taxes, insurance and repairs on rea! estate my be deducted iron: income, as heretofore provided by the law and regulations. 3. All persons or corporations that heretofore rendered income tax re? turns for the year 159-1 to a collector or deputy collector, including therein interest received from State, county or municipal bonds, or from rents from real estate, may have the amounts of said interest and rents deducted from their income by duly making an affidavit to that effect and j delivering the same to the collector i or deputy collector to whom the I original return was rendered 4 The collector, upon receipts of the prescribed affidavit, shall attach said affidavit to the return of the affiant heretofore made, and shall make the correction in said return in conformity with the facts stated in said affidavit and forward said amended return, with the affidavit attached, to the Commissioner of In? ternal Revenue. Jos. S. MILLER. j Commissioner of Internal Revenue. ! Approved : J. G-. CARLISLE, Secretary of the Treasury. These telegrams were sent to col? lectors: WASHINGTON, Ap iii 18 -Have the affidavits and instructions printed and distributed immediately to all persons who have rendered returns. All returns received here will be for? warded to you by mail. Correct same by attaching affidavit and making de? duction as shown therein. Require all persons in making returns in fu? ture to show clearly the rents includ? ed and deducted were received only from real estate and include nothing whatever paid for rent or U6c of pro? perty and franchise. Jos. S. MILLER, Commissioner. WASHINGTON, April ll.-If neces? sary for accommodation of persons filing income tax returns, you will keep your office open for business from 8 a. m. to 6 p. m , up to and including the 15th inst. Jos S. MILLER, Commissioner. "There is no power vested in this department/' telegraped Commission? er, late this afternoon, "to extend the time for making returns under the income tax law " With the supplemental instructions sent to collectors of internal revenue to-day, together with the telegrams as to keeping open their offices be? yond the regular hours. Commission? er Miller has closed up as complete? ly as he can his connection with the ' enforcement of what remains of the income tax law Collectors and those Subject to the law must do the rest and must do it be for? the close of j business on next Monday, April 15, ! or else be subject tc the penalties I imposed by the law. Those who never read the advertisements io their newspapers miss more ihan they nresume. Jonathan Kenison, ?if Bolan, Worth Co , Iowa, who had bee? troubled ! with rheumatism in his back, arms and ! shoulders read an item in his paper about : hjw a prominent German citizen of Ft. Mad ! ison had been cured. He procured the same medicine, and to use his own words: "It I cured me right up" He also save: S,A neighbor and his wife were both sick in bed with rheumatism. Their boy w?e over to wy house and said they were so bad be had to do the cooking, I told him of CbHmberlain's Pain Balm and how it had cored me, he got a bottle and it cured them up in a week. 50 cent bottles for pale by Dr. A. J. China. Choice writing: Paper ten cents per box at H. a. Osteen & Co's. vcr.- Latest U. S. Gov't Report Baking , Powder fEEV IHJRE