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Subject Area: Law
Topic: The American Revolution and Constitution

§ 160.: Taxation—Kinds of taxes.— - Christopher G. Tiedeman, A Treatise on State and Federal Control of Persons and Property in the United States considered from both a Civil and Criminal Standpoint, vol. 2 [1900]

Edition used:

A Treatise on State and Federal Control of Persons and Property in the United States considered from both a Civil and Criminal Standpoint (St. Louis: The F.H. Thomas Law Book Co., 1900). Vol. 2.

Part of: A Treatise on State and Federal Control of Persons and Property in the United States considered from both a Civil and Criminal Standpoint, 2 vols.

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§ 160.

Taxation—Kinds of taxes.—

The functions of a government can only be exercised and kept in operation with the aid of material means furnished by the people; and no government could be properly called stable, which had to depend upon voluntary contributions. The exaction of these means, therefore, is a power which a government inherently and necessarily possesses without any express grant. A tax, is, in its most comprehensive sense, any charge or assessment levied by the government for public purposes upon the persons, property, and privileges of the people within the taxing district or State. It is a forced contribution of means toward the support of the government.

Taxes may assume very many forms, varying according to the thing, privilege, or right which is taxed. They may take the form of duties, imposts and excises, and the taxes imposed by the general government are confined to these. The power to impose these indirect taxes is expressly granted to the United States government. The constitution provides1 that “the Congress shall have power to levy and collect taxes, duties, imposts, and excises to pay the debts, and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States.” Duties and imposts are the taxes levied upon importations into this country, and under this express power it is claimed that the general government may establish a protective tariff, which has already been shown to be in violation of constitutional liberty.2 Excises are the taxes laid upon the manufacture and sale of articles of merchandise, upon licenses to follow certain occupations, and upon the enjoyment of franchises or privileges. The internal revenue tax upon the manufacture and sale of intoxicating liquors and tobacco are at present the only excises levied by the general government.1 But there is no limitation upon the power of the government in selecting the subjects of taxation; and during the late civil war, and immediately thereafter, there were taxes, in the form of stamp duties on matches, bank checks, legal papers and the like. The United States government is also authorized by the constitution to impose direct taxes, which has been held to include any capitation and land taxes,2 subject to the limitation that they must be apportioned among the several States according to the representative population.3

A very common form of State and municipal taxation is the exaction of license fees for the privilege of pursuing any occupation or profession, a tax, therefore, upon occupations. The constitutional character of the license tax, and its points of distinction from the license fee exacted in connection with the police regulation of an occupation, the pursuit of which is likely to prove dangerous or injurious to society, have already been fully explained in another place,4 and need not be discussed in this connection. The States have also at times imposed a poll-tax upon the citizen, and made the payment of it a condition precedent to the exercise of the right of suffrage. But this mode of taxation incurs great popular disfavor, and is very rarely, if at all, employed now.

The most common form of State and municipal taxation is the taxation of property, both real and personal, and there is a fundamental difference between the character of taxation generally, including the taxation of personal property, and the character of taxation of real property. Taxation, generally, is imposed upon citizens and resident aliens, resting upon the permanent or temporary allegiance they owe to the goverment; and they are supposed to receive a fair equivalent for these involuntary contributions in the domestic peace and order, and the protection to their rights of person and property, which a stable government insures. The obligation to pay taxes in such cases rests upon the fact of domicile and citizenship. But the taxation of real property rests upon other grounds. In its application to real property, taxation assumes a decidedly feudal character. If the power to tax real property rested solely upon the obligations of citizenship or domicile, as most of the legal authorities seem to hold,1 then it could only be levied upon those proprietors of lands who were citizens. At the time when the earlier cases, which have been cited, were decided, no one but a citizen could become the proprietor of lands in the United States, and this coincidence no doubt caused the learned judges to make the statements, upon which the claim of a connection between citizenship and taxation of real property rests. But, since then, the restriction upon the proprietorship of lands by aliens has been removed in most of the States, and now all land situated within the jurisdiction of the government which levies the tax are taxed for their proportionate share, whether the land is owned by citizens or aliens, residents or non-residents. The levying of a tax upon land, and the enforcement of the levy, are proceedings in rem against the land, and not in personam against the proprietors.2

Taxation of real property is nothing more than the reditus which the tenant of a feud paid to the lord of the manor for the enjoyment of the land; in this country, in the case tenancies in fee, the State taking the place of the intermediate landlord, as in England the king did in the case of tenancies in capite. Indeed the obligation of citizenship is a modern outgrowth of the allegiance of the feudal system, which the vassal or tenant of land owed through his lord to the king, as the lord paramount or ultimate proprietor of the lands of the kingdom. The obligation of citizenship, apart from the obligations of a tenant of lands, was unknown to the feudal age.1 But whatever may be the proper theory in respect to the character and the authority of taxation, the power of the government to levy the proportionate share of taxes upon the lands owned by aliens has never been questioned, and an exemption of such lands from the operation of the levy would most surely meet with popular demonstrations of disapproval.

[1]Const. U. S., art. I., § 8, ch. 1.

[2]See ante, § 93.

[1]Since the above was written at the last session of Congress, 1885-1886, a law was passed imposing a tax upon the sale and manufacture of oleomargarine; and in 1898, Congress passed a general stamp act, and imposed a graduated tax upon inheritances.

[2]Hylton v. United States, 3 Dall. 171; Pacific Ins. Co. v. Soule, 7 Wall. 433; Veazie Bank v. Fenno, 8 Wall. 533; Springer v. United States, 102 U. S. 586.

[3]Const. U. S. art. I., § 2, art. I., § 9.

[4]See ante, § 119.

[1]Cooley on Tax. 360. In some of the States, however, a distinction it made by statute between the resident and non-resident lands as they are called, imposing a personal liability upon the owners of the resident lands. Cooley on Tax. 278, 279.

[2]Providence Bank v. Billings, 4 Pet. 561; McCulloch v. Maryland, 4 Wheat. 428; Opinions of Judges, 48 Me. 591; People v. Mayor, etc., 4 N. Y. 422; Clark v. Rochester, 24 Barb. 482; Phila. Assn., etc. v. Wood, 39 Pa. St. 73; Moale v. Baltimore, 5 Md. 314; Doe v. Deavors, 11 Ga. 79; Chicago v. Larned, 34 Ill. 279; Davison v. Ramsay Co., 18 Minn. 481.

[1]Tiedeman on Real Prop., § 20; 1 Washb. on Real Prop. 46, citing 3 Guiz. Hist. Civ. 108.