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The Clerk read as follows:

each, thus recognizing the principle that the weighing them down and crippling their enerThat section ono hundred and fourteen bo amended man of larger means should pay an increased gies. I trust that this amendment will receive by inserting after the word "periodically” in the first tax in proportion to his means. That is a prin- | the favorable consideration of this House and sentence of the said scetion the words or otherwise, or publishing any guide, almanac, cataloguo, direct

ciple recognized by the bill of the Committee that we will show that we are in earnest in ory, or any other paper or book.'

of Ways and Means when they exempt men of endeavoring to relieve the poor pecple and Mr. AXCOVA moved to add the following:

moderate income, up to $1,000, from taxation placing the tax upon those who are able to

altogether. And it is carrying out the same bear it. And that section one hundred and fourteen be further amended in the last clause so as to cxempt all

idea when you have apportioned this from five [Here the hammer fell.] newspapers whose average circulation does not ex- to ten per cent. The principle is also recog. Mr. MORKILL. I oppose the amendment ceed ihrco thousand copies from all taxes for adver- nized in the taxation of gas companies, where of the gentleman from Illinois, [Mr. Ross.] tising.

the tax ranges from five cents on a thousand The only question which is really before the The committee divided; and there were- feet to ten, fifteen, and twenty-five per cent., committee is whether we had better forego this ayes 26, noes 10; no quorum voting.

in proportion to the amount produced. It is tax or some other. I am as ready as the gentleThe CHAIRMAN ordered tellers under

a fair principle of taxation and one that sound man from Illinois to admit that the men who the rule; and appointed Messrs. Ancona and

political economy should recognize, because receive two or three hundred thousand dollars MORRILL.

the aim always should be to lay taxes on that income can afford to pay an increased tax, but The committee was again divided; and the

portion of the community that can most easily that is not the question here. The question is, tellers reported-ayes 28, noes 70. bear them.

can we afford to take it in this manner? The So the amendment was disagreed to.

I do not know that I am personally interested principle that we apply must be a just one, and The Clerk read as follows:

in the matter, but the great mass of those who | living in a republican form of government as INCOME.

are particularly interested I know would very we do, I cannot see on what principle the tax That section one hundred and sixteen be amended

cheerfully pay this additional sum, for I have proposed by the gentleman from Illinois [Mr. by striking out all after the enacting clause and in

not yet heard of any remonstrance from any Ross) or the gentleman from Maine [Mr. serting in licu thereof as follows: that there shall be levied, collected, and paid annually upon the gains,

gentleman whose tax is more than five per cent. Pike) can be justified. profits, and income of every person residing in the according to the existing law. No one of this The example cited by my friend from Maine United States, a duty of five per cent, on the excess over $1.000, and a like duty shall be lovied, collected,

class has ever sent a request to this Congress of England, which levies a tax of this kind, is and paid annually upon the gains, profits, and in to be relieved from taxation, and if we wait no argument for us. There they have differcome of every business, trade, or profession carried until that patriotic class of men shall ask to be ent classes. They have a titled class and dison in the United States by persons residing without

relieved from their burden, I apprehend we tinctions of rank, and those classes ought to the United States, and a like duty shall bo levied, collected, and paid annually upon the interest or

will have to wait a great while. On the other be made to pay for their titles. In this coundividends accruing upon investments within the Uni- hand, we do have petitions from struggling try we neither create nor tolerate any distincted States, or upon bonds or other securities of the United States, or of corporations, or citizens thereof.

manufacturers coming to us from all quarters tion of rank, race, or color, and should not And the duty herein provided for shall be assessed, of the land, asking for relief. Now, we all tolerate anything else than entire equality in collected, and paid upon the gains, profits, and in- desire to relieve all the processes by which our taxation. So, then, I think the proposicome for the year ending the 31st day of December

wealth is created. We all desire to relieve, tion cannot be justified upon any sound princinext preceding the time for levying, collecting, and paying said duty. as much as possible, the labor of the country | ple of morals. It can only be defended on

the same ground that the highwayman deMr. PIKE. I move to amend by striking from taxation, because by doing so we produce out all after the words “ United States” in line

the best general result. It is for this reason fends his acts. It is saying to the man of twenty-four hundred and sixty-six down to the

that I hope the House will follow the English wealth, “You have got the money and we will end of line twenty-four hundred and seventy

example, and for a few years to come retain take it because we can make a better use of it five, and to insert in lieu thereof the following: this tax of ten per cent.

than you will." And then it tends to create [Here the hammer fell.]

a great amount of fraud and false swearing. A Or of any citizen of the United States residing abroad whether derived from any kind of property,

Mr. ROSS. I move to amend the amend

man who is taxed only as high as his neighbor rents, interest, dividends, or salaries, or from any ment by inserting after the words “one thou- upon the amount he possesses is willing to profession, trade, employment, or vocation carried sand dollars” in line twenty-four hundred and pay his tax. Go beyond that and he believes on in the United States or elsewhere, or from any other source whatever, a duty of five per cent on the sixty-eight, the following:

himself to have been wronged and he will reamount so derived over $1,000 and not exceeding

And not exceeding $10,000; and a duty of ten per

taliate. But do you come to a man who owns $5,000, and a duty of ten per cent, on the amount

cent. per annum on the excess over ten thousand and five hundred sheep and say to him that he shall exceeding $5,000. And a like duty shall be levied,

not exceeding twenty thousand dollars; and a duty collected, and paid annually upon the gains, profits.

pay more than twice as much on his sheep as of fifteen per cent. per annum on the excess over and income of every business, trade, or profession | $20,000, and not exceeding $40,000; and a duty of

the man who has but two hundred and listy? carried on in the United States by persons residing without the United States and not citizens thereof. twenty percent. per annum on the excess over $40,000

No. Do you go to the man who owns two and not exceeding $60,000; and a duty of twenty- hundred acres of land and say that he shall This is a matter of considerable importance. five per cent. per annum on the excess over $60,000.

pay twice as much, tax per acre as the man The chairman of the committee states that the I concur in the views expressed so ably by who has only one hundred acres? No. I say, change proposed in this bill lessens the rev- the gentleman from Maine [Mr. PIKE] upon then, that in a republican form of government enue $17,000,000. The amendment proposes this subject. But his amendment does not go we cannot justify this inequality of taxation. an exemption of incomes up to $1,000; other- far enough. The highest rate it proposes to Mr. SPALDING. May I ask to what tax wise it is a reenactment of the old law. The put upon income is ten per cent. Now, it was the gentleman is now referring? question arises as to the propriety of assessing | very properly said by him that we must get Mr. MORRILL. I am discussing the propan income tax of five per cent. on one amount, this tax out of men who have large incomes. osition that when the amount of income exand a tax of ten per cent. on a larger income. We cannot get it out of those who have none. ceeds $5,000, a tax of ten per cent., instead of Of course it is only upon the net income, and And there is no reason, in my judgment, when five, shall be imposed. a tax of ten per cent. upon net income is not a man's income reaches twenty, forty, or sixty Mr. SPALDING. May I ask the gentleman higher than many other rates imposed in this thousand dollars why he cannot afford to pay what the law is now? bill. Now, if we give away by this provision | fifteen, twenty, or twenty-five per cent. upon it. Mr. MORRILL. The gentleman will have in the bill as it stands seventeen millions of It will be recollected that the country was an opportunity to argue the question. I do revenue, we must look elsewhere to supply the electrified a year or two ago by the announce- not desire to discuss the matter in the form of deficiency. If we retain the seventeen millions ment that the capitalists of this country were a colloquy. The question arises here to-day, of tax we may relieve many small and weak going to make an effort to pay off the entire as I believe, whether this tax can be fairly manufacturers of the country. Every laboring debt of the country. An effort was made in justified on principle. If other gentlemen man in the country pays a tax upon what he that direction, and we were highly gratified at are persuaded, as I believe a majority of the eats, drinks, and wears. And until we come the patriotism and liberality of some of the House are persuaded, that it is just, I am not. to the point of relieving the great body of peo- || distinguished capitalists of the country in com- But if gentlemen should reach the conclusion ple in the country from onerous taxes upon | ing to the relief of the poor men from the bur. that it is justifiable upon principle, then the every day's consumption it is a question whether den of debt heaped upon them. The only question arises whether this tax is one ye or not the men who are able to pay should not reason they did not succeed was that a few | ought to surrender or some other. I think, pay this increased proportion of their income stingy, miserly millionaires refused to coöper- Mr. Chairman, that if gentlemen will look at to the General Government.

ate with them. Now, the patriotic capitalists the matter fairly, they will see that this is not I have examined the English law from which of the country will be gratified at this effort on such a tax as can be justified here and now this income tax derived, and I find that for the part of Congress to enable them to come with us, nor such as we can afford to incorposeveral years the system in that country was to the rescue of our country and make those rate permanently into our statutes. ten per cent. on large incomes, seven and a who are unwilling to contribute their propor

Mr. SPALDING. Mr. Chairmanhalf on more moderate income, and five per tion come to the scratch and relieve the Gov- The CHAIRMAN. No debate is in order, cent. on the smaller, not divided precisely as ernment from its indebtedness. I ask the there being an amendment to an amendment we divide them, but by different kinds of prop- House to give this matter a fair consideration. | pending. The gentleman, however, can move erty. They have always pursued the system of Patriotic capitalists will not object. Those to amend the text of the bill. apportioning taxes upon property and income. who have incomes of two and three hundred Mr. SPALDING. I will do so. I move to In one instance a specific tax was laid on those thousand dollars can afford to pay twenty or amend by inserting after the word “dollars,' who kept servants, commencing with one pound twenty-five per cent. on their incomes for the in line twenty-four hundred and sixty-eight, on one servant and inereasing until the men purpose of relieving the poor people of the the following: who had eleven servants paid six pounds on country from the enormous burden which is And not more than $6,000; and on the excess opor

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and above $6.000, a duty of three per cent. per an- next man he meets, and to whom says, “Your to be stricken out, and an amendment to that num additional.

money or your life," must disgorge because he amendment. I must confess, sir, that I do rot understand happens to have some money. Now, the high- Mr. SLOAN. The main objection urged the chairman of the Committee of Ways and way robber never robs the man who has no

to the exemption of articles from taxation, or Means when he says that a tax of this charac- money. He treats them all alike; he takes

to the reduction of the tax heretofore laid upon ter is not in aceerdance with the principles of money where it is, and where it is not he does

those articles, as been that it would reduce justice, and further, that it is "highway rob- not take it. Now, in my opinion we better the revenue to a point lower than it would be bery." According to my logic, a proposition treat all men alike in this matter of taxation.

wise or proper to reduce it. Now I find that in of this sort does not come within either of those If one man is more economical than another, this article of income alone there are involved categories. When we lay a general tax of five and saves more money, and so at the end of

$17,000,000 of revenue, an amount which I per cent. upon every man's income over the some years is in possession of more income in

suppose will cover three or four times over all sum of $1,000, does not that take within its consequence of such economy, I do not think

the taxes which have been lost by the amend. purview every man in the community subject he should be punished for that which should ments which the committee have made in exio taxation? Then upon that annual revenue be considered a virtue. They should all be

empting from taxation or reducing the tax upon up to $6,000, as my amendment proposes, a treated alike, without reference to the incomes those articles of prime necessity in common tax of five per cent. is to be paid--not by one they may have.

use in the industry of the conntry. And in a man, but by every man in the community hav. Nr. SLOAN. I move pro formâ to amend year or two all of them can be relieved from ing that amount of income. The assessment the amendment of the gentleman from Ohio that tax. There are many items in this bill is equal. The amendment further provides [Mr. SPALDING] by striking out the word where relief can be afforded more justly and for an additional assessment of threc per cent. "four” and inserting the word “three."

more equitably and more in accordance with upon the amount of income over $6,000. Is not Mr. SPALDING. Will the gentleman from the interests of the whole country, than by the this just? Is it robbery? Why, sir, we adopted Wisconsin [Mr. Sloan) yield to me a moment change proposed by the committee. the other day a provision imposing a tax upon for the purpose of modifying my amendment? Mr. MORRILL. I desire to say that I feel wooden bowls and upon corn brooms. We are Mr. SLOAN. I prefer not to yield now, as no particular interest in this question, or as to prepared, too, it seems, to tax the brave soldiers I hare but five minutes. I was surprised to how it shall be disposed of. Perhaps I may who fought our battles during the last five years hear the chairman of the Committee of Ways have expressed myself a little too strongly., I in every case where the amount of income is and Means [Mr. Morrill] indulge in such did not intend to take any part in debating this over $1,000; but we are not prepared to say strong expressions as he used. He says that question, but to let the House take its own that gentlemen who have incomes of $100,000 the proposed change in this tax could not be

I only wish to keep myself right on the a year shall be taxed over and above the rate defended upon principle, and that it amounted record. I have been from the first opposed to which we assess upon the income of the man to a robbery of a certain designated class of the principle of the tak. Our urgent necessities of very moderate means. Now, as I have said people. Now, I suppose if a perfectly just || during the war having ceased, I think we ought time and again upon this floor, the tax is equal system of taxation could be devised and put to relieve ourselves at the earliest moment while the means of payment are unequal. The in force, every man would be taxed just in from such a tax. The particular effect of it man who has the higherincome has the greater proportion to his ability to pay the tax; not is to harass men of great enterprise in the coun• means of payment and feels the tax less. The perhaps in proportion to the amount of propdifference is in his favor. The poor man, to

try. I do not see how gentlemen, after they erty he may have, or what he may produce, || have accumulated a certain amount of property, the extent of his modicum, pays his full tax. but in proportion to his ability to pay his tax; will be willing to continue their adventures If he had a larger income he would of course in proportion to the excess which he has left

thereafter for fear of becoming subject to the be happy to pay the increased tax. Not so after meeting all the legitimate demands upon tax. It will have the effect, too, of creating with the millionaires. They fix upon a mod- him. Now, throughout the consideration of absenteeism. When men have acquired a large erate income of $5,000, and say, this bill the chairman of the Committee of

fortune they will be very apt to go elsewhere to take our stand and set the tax-gatherer at defi. Ways and Means has resisted strenuously all expend it.' That is all I have to say on that ance, because it would be inequality, it would propositions to relieve from taxation many

point. be injustice, it would be highway robbery to articles the tax upon which is oppressive and Mr. SLOAN, by unanimous consent, with: make us pay from our overflowing coffers a burdensome to the industry of the country. drew his amendment. trifle upon the excess above what is required The tax upon those articles tends to depress

Mr. PAINE. I renew the amendment. The to meet the necessary demands of life.” Why, and check the business and enterprise of the

chairman of the Committee of Ways and Means sir, I cannot see upon what ground, in morals country. Here is a tax where we allow a or in ethics or in logic, the argument of my

has pronounced the proposed amendme it before liberal income of $5,000 to be taxed at the learned friend from Vermont has a resting

the House discriminating in favor of incomes common rate to which all are liable. On the

below $1,000 and against those above that place. There is nothing in it in reason, noth- excess beyond that amount a higher rate of amount to be unjust and wrong. I am sorry. ing in it in justice. And I trust that the reflect- tax is imposed. ing men upon this floor will ponder well before Mr. HALE. I rise to a point of order. My

If that be robbery, he has come into this House they can be induced to change the very equi- point of order is that debate is exhausted upon bery. I take it he does not disapprove the bill

with his garments stained all over with robtable mode of assessment which we adopted the amendment moved by the gentleman from

he himself introduced. I take it he approves here two years ago, and which did make some Illinois [Mr. Ross) to the amendment moved difference between the rich man and the man by the gentleman from Maine, [Mr. Pike,] and

that provision which requires a man worth of moderate means. that the subsequent amendment of the gentle

$1,001 a year to pay a tax of five per cent. per Mr. PRICE. I rise to oppose the amend

annum, and yet exempts his neighbor who man from Ohio [Mr. SPALDING] is therefore

may only be worth $999 from the payment of ment of the gentleman from Ohio, [Mr. Spald- out of order. ING,) and I do so because I do not think it at The CHAIRMAN. The amendment of the

any tax whatever. . If this be robbery to make

it ten per cent, above a certain amount, what all equitable. I do not think the amendment gentleman from Ohio [Mr. SPALDING] is an

will be said of that discrimination which comwould make the tax bear equally upon all men, amendment to the text proposed to be stricken without regard to race or color. Now, sir, the out by the amendment of the gentleman from

pels a man to pay a tax when his income is matter is just this; and I want the attention

over $1,000 and relieves him from taxation Maine, [Mr. Pike,) and therefore it takes preof the gentleman from Ohio [Mr. SPALDING] cedence of the amendment proposed by the

entirely when below that amount? But there

is no robbery in either case. If the gentleman to this proposition : we will suppose there are gentleman from Illinois, [Mr. Ross.]

desires to put himself right on the record, let two men living neighbors to each other; the Mr. HALE. I would ask the Chairman how income of one is $5,900, of the other it is

him wipe out what he has already written in many amendments are now pending before the this bill. $6,100, a difference of just $200 between their committee. incomes. They are neighbors, engaged in the

Now, Mr. Chairman, I want to read to the

The CHAIRMAN. The Chair understauds same business, and occupying the same posi- the amendment of the gentleman from Maine

committee a few paragraphs from a little worktion and standing in the community. But you [Mr. Pike) to be to strike out a portion of the

Report of the United States Revenue Comtax the one at the rate of five per cent., while

mission-which I presume is the vade mecum original text. The gentleman from Illinois you tax the other, with only $200 more income,

of the Committee of Ways and Means. Let me [Mr. Ross] moves an amendment to the amendat the rate of ten per cent. That is the way it

read from page 17 : ment of the gentleman from Maine. Pending works; you tax the man because he has the

"The remedy, therefore, for the difficulties above those amendments, the gentleman from Ohio pointed out and illustrated, save in a few striking inmoney.

[Mr. Spalding] proposes to amend the matter stances, which have probably resulted from oversight Now, I want to defend the gentleman from proposed to be stricken out by the amendment

in the framing of the law, must, in the opinion of the

commission, bo sought for in such a revision of the Vermont (Mr. Mornill) from the "highway of the gentleman from Maine. That amend- internal revenue system as will look to an entire exrobbery'' charge. He did not say that it was ment takes precedence of the other amend- emption of the manufacturing industry of the United highway robbery to take this tax; but he said ments, as being for the purpose of perfecting

States from all direct taxation. (distilled and fer

mented liquors, tobacco, and possibly a few other that it was upon the same principle that the the text proposed to be stricken out. And the

articles excepted.) This the commission are unhesihighway robber practices. And it is precisely amendment of the gentleman from Ohio is itself tatingly prepared to recommend.” as he stated. The highway robber goes out open to an amendment which has been proposed Then let me read from the bottom of the upon the highway, seizes a man by the throat, by the gentleman from Wisconsin, [Mr. Sloux.]

same page: and says to him, “Your money or your life." Thus lour amendments can be pending at the • Assuming, then, that the policy indicated-which The man looks at him and says,

same time: an amendment to strike out and we may here restato in brict to bo the abolition or cannot get any money from me, for I have insert, and an amendment to that amendment;

speedy reduction of all tires which tend to check none." The robber lets him go. But the an amendment to amend the matter proposed

development, and the retention of all those wlich, likcthoincome tax, fallchiefly upon realized wealth

si Well, you

is accepted as the desirable future revenue policy of I have one word to say in reply to the gen. me that he has failed to give the true reason the country, the question next arises, in what manner and to what extent can it be carried out, and at

tleman from Vermont, [Mr. MORRILL.] I cited for it, and the one which removes it entirely the samo time insure to the Governinont & revenue the example of England in this matter of in- from the line of argument which these gentleadequate to its necessities?"

come tax.

I did it because British legislation men have adopted. I apprehend that the reaNow turn to page 27 of the same report: has always been of a conservative character son why incomes up to the amount of $600 "Incomes.-In respect to the income tax thecommis- with regard to property, and no man can be under the present law, and $1,000 under the bion hitve not, from want of time, been able to give accused of demagoguisın or of pandering un- proposed law, are exempt from tax is not that this subject the attention whioh its importance demands. Although in many respects an obnoxious

duly to the popular taste who follows the con- the possessors of small incomes are unable to tas. yet, falling as it does mainly on accumulation, it

servative example of British legislation. The pay a tax, but that the law intended that the will probably be sustained with less detriment to the chairman of the Committee of Ways and Means average amount understood to be necessary country than any other form of taxation, the excise on spirituous and fermented liquors and tobacco

replies to me that they have rank there, that they for the support of a family should not be taxed. excepted. The discrimination at present in the rate have lords and commons, a queen and dukes, It was understood, two or three years ago, that levied on incomes under and in excess of $5,000 is, barons and knights. Now, if the income tax $600 was probably the average of the expense however, unjust, being in fact a tax on the results

-under British legislation was assessed in proof successful industry and business enterprise; and

for the support of a family; now it is considthe commission recommend that this discrimination portion to rank, the argument would be a good ered that $1,000 is probably that average; and bo abrogated, and tho rate be equalized at five per one, but, as he well knows, some of these lords it is proposed to exempt that amount, not as cent.

and barons are as poor as church mice; they a discrimination in favor of the poor man as You must not tax industry, but must tax the are entirely barren of income, as the gentleman against the rich man, but as the average exresults of industry; and then further on they | from Iowa [Mr. Wilson]suggests, slaughter ;] pense of the support of a family to every man say you must not tax realized wealth. It is

and consequently the reply made by the dis- | throughout the country; in other words, it is impossible to frame a tax bill from such con- tinguished chairman of the Committee of Ways not a discrimination; it applies equally to every tradictory recommendations as these.

and Means is entirely mal à propos. Now, I man; it is only incomes above that amount of [Here the hammer fell.]

have to say one word further. When the gen- average expenses that are subject to taxation. Mr. DAVIS. I oppose the amendment, and tleman says that the Committee of Ways and Now, I put it to this committee whether I do it for the purpose of saying that I believe Means in reporting this bill make no distinc- | there is on principle any sound reason whatever the action of this House would be very unwise tions in rank, I reply that they have made two why a man possessing an income of $100,000, if we discriminate on the subject of tax on in- ranks--one is the great mass of the people who if you please, should pay more than his ratio, comes. If there is any principle settled in our have less than $1,000 income, and the other his percentage on that income, more than the Government it is that of uniform privileges. rank is that smaller class of people who have man with an income of $5,000 pays? Sir, I It runs through the Federal Constitution and it an income of more than $1,000. I propose do not believe it is equal or just. We have the runs through every State constitution. And, || simply to add to the number of ranks, and power to do it, as we have the power to go fursir, but for the exigencies the war imposed make another over $5,000. Will the chairman ther and say that if a man has an income of upon us I do not think we would at the last of the Committee of Ways and Means tell me over $5,000 the country shall take the whole. Congress have departed from that system. The the difference in principle?

I do not know why it might not as well be done capital of this country should be protected. It [Here the hammer fell.]

in that form as in the form proposed by the should be invited to investments of enterprise Mr. MORRILL. I will answer the gentle. Il gentleman from Illinois, who runs the tax up and industry. If we discriminate against capi- man, although if he had noticed what I have by hundreds and thousands, increasing the tal we interpose obstacles to business, because said heretofore he would have already known | grade until you get up to twenty-five per cent. if men are successful we tax them unfairly and what the answer is. As I said to the gentle- || I ask the gentleman, why does he not say that unjustly. Why should a man, on the principle man from Wisconsin, [Mr. Paine,) we con- when a man's income exceeds $80,000 he shall which is advocated here, who owns a farm of five ceived that there was an inability on the part || pay fifty per cent., when it exceeds $100,000 hundred acres, not be taxed five times as much of a person with a small income, and who has he shall pay one hundred per cent., and when per acre as the man who owns a farm of fifty a family to support, to pay any income tax. it exceeds $200,000 he shall pay two hundred acres? That is the principle thatis involved here. He must first support his family, and therefore per cent.? It does seem to me that the princiYou discriminate in consequence of the amount we exempt $1,000 for every man or family. || ple upon which these taxes have always been of property which a man holds. You take away That, I think, is a sufficient reason. The other assessed has been upon a principle of equality. from the accumulation of industry that which point which the gentleman from Wisconsin In our local taxation, our State taxation, we would go into capital except for the interference | alluded to, I think is "' point no point”-that do not say that a man who holds real estate or of the Government. You turn that portion of in reference to the exemption among man- personal property beyond a certain amount the capital over to the coffers of the Govern- ufacturers to the amount of $1,000. The shall pay a greater percentage upon his prop; ment. You thus derange and decrease the party, it will be remembered, has to sell his erty than the man who holds a less amount. I business of the country. I hope the amend- goods in the same market with all the rest of submit that however gentlemen may treat this ment will not be adopted.

the country; and he gets the same price for \ argument it simply results in the proposition Mr. PAINE. I withdraw the amendment those goods; and whatever is exempted is really that the rich men being in the minority shall to the amendment.

a bonus given to the parties, on the same prin- | have injustice done to them. I withdraw my Mr. PIKE. I renew it. When I was inter- ciple that we except $1,000 of income because amendment to the amendment. rupted before I was about to make a proposi- of the inability of those small manufacturers to The pending question was upon the amendtion which I think the Committee of Ways and pay the tax. The gentleman from Maine [Mr. ment of Mr. SPALDING. Means will accept, and that is to strike out this || PIKE] alluded to the fact that the income tax Mr. MORRILL. I move that the committee section and the next three succeeding sections, in England is not assessed in proportion to rise for the purpose of closing debate. and allow this whole matter to go over until next rank or title. Does not the gentleman know The motion was agreed to. year. The tax for this year is already assessed. that the titled aristocracy of England own So the committee rose; and the Speaker The instructions have already gone out. The nearly all the land of England ? I do not having resumed the chair, Mr. Dawes reported change of law will not affect it in any par- remember the precise number of land-owners that the Committee of the Whole on the state ticular, either in the assessment or collection. there, but I think it is not beyond thirty thon- of the Union bad had under consideration the This Congress adjourns, finally, on the 4th of sand in the entire kingdom; and it is from this Union generally, and particularly the special March next. There will be abundant time to

from rents, that the largest incomes are order, being bill of the House No. 513, to amend regulate this matter between the 4th of March, there derived. If the gentleman had investi- an act entitled "An act to provide internal rev. when Congress adjourns, and the 1st of May, I gated the subject he would have ascertained, enue to support the Government, to pay interwhen the tax is assessed. In the mean time also, that while formerly they had different est on the public debt, and for other purposes, we shall have the benefit of the experience rates of income tax in England, the present approved June 30, 1864, and acts amendatory during the vacation. The revenue commission law is a uniform law, imposing the same tax thereof, and had come to no resolution thereon. has come to the conclusion, and it is the same upon all incomes.

ENROLLED BILL SIGNED. conclusion to which we have all come, that the Mr. PIKE. I withdraw my amendment to amounts to be realized from the assessments the amendment.

Mr. TROWBRIDGE, from the Committee made in this bill are exceedingly uncertain. Mr. HALE. I renew it. A point has been on Enrolled Bills, reported that they had exThey depend upon business to be done here. made in favor of a discrimination between in.

amined and found truly enrolled a bill of the after, and whether or not the expectations of comes up to $5,000 or $10,000, and incomes following title; when the Speaker signed the the Committee of Ways and Means will be in excess of one or the other of those sums by realized, or the revenue fall very far short of a reference to the exemptions of incomes under An act (H. R. No. 453) for the relief of Corthe calculations made by the Committee of $1,000; and it has been strenuously contended

nelius B. Gold, late acting assistant paymaster Ways and Means, nobody knows. Perhaps one by the gentleman from Wisconsin, [Mr. Paine,]

United States Navy. intelligent gentleman here can guess as well as by the gentleman from Maine, (Mr. Pike,] and STATE LAWS CONCERNING FREEDMEN, another, but the experience which we shall have by other gentlemen, that the fact that incomes between now and the next 4th of March will

The SPEAKER laid before the House the up to $1,000 are exempt from all tax is of itself determine this problem. It would be wise, then, a recognition of the principle that discrimina

following message from the President of the

United States: to postpone the whole matter until next ses- tions may be made according to the amount of sion. If the House does not assent to this prop- the income of the party. With all deference To the House of Representatives : osition, I hope that they will assent to my amend- to the chairman of the Committee of Ways and In answer to a resolution of the House, of ment, which will continue the present law Means, who has given his reason for that ex. the 27th ultimo, requesting a collation of the except to exempt incomes up to $1,000. emption up to the amount of $1,000, it strikes ll provisions in relation to freedmen contained

39TH Cong. Ist Sess. -No. 175.




in the amended constitutions of the southern | amendment by striking out the last clause, as incomo of any person in addition to $1,000 exempt States, and in the laws of those States passed follows:

from income tax, all national, State, county, and

municipal taxes paid within the year shall be desince the suppression of the rebellion, I trans- And a like duty shall be lovied, collected, and paid ducted from the gains, profits, or income of the permit a report from the Secretary of State, to annually upon the gains, profits, and income of every son who has actually paid the same, whether such whom the resolution was referred.

business, trade, or profession carried on in the Uni- person be owner, tenant, or mortgagor; losses on sales

ted States by persons residing without the United ANDREW JOHNSON.

of real estate within the year purchased within two States and not citizens thereof.

years previous to the year for which income is estiWASHIxgton, D. C., May 22, 1866.

The amendment to the amendment was not

mated; the amount actually paid for labor or inter

est by any person who rente lands, or bires labor to The message, with the accompanying docu- | agreed to.

cultivate land, or who conducts any other business ments, was referred to the joint committee on On agreeing to the amendment of Mr. Pike,

from which income is actually derived; the amount reconstruction, and ordered to be printed. there were-ayes 61, noes 34.

paid out for usual or ordinary repairs: Provided,

That no deduction shall be made for any amount paid CLERKS IN TREASURY DEPARTMENT. Mr. HALE called for tellers.

out for new buildings, permanent improvements, or The SPEAKER also laid before the House

Tellers were ordered; and Messrs. Hale and

betterments, made to increase the value of any propPike were appointed.

erty or estate: And provided further, That only one the following message from the President of

deduction of $1,000 shall be made from the aggregate the United States:

The committee divided; and the tellers re- income of all the members of any family, composed ported-ayes 57, noes 42.

of one or both parents, and one or more minor chilTo the House of Representatives :

So the amendment was agreed to.

dren, or husband and wife; that guardians shall be

allowed to make such deduction in favor of each and I transmit herewith a repori from the Secre- Mr. ANCONA. I move to amend by adding version comprised in one family, only one deduetary of the Treasury, made in compliance with at the end of the paragraph the following:

tion shall be made in their favor; and that no deduc. a resolution of the House of Representatives,

Provided, That the amount, $1,000, exempt from tion shall be allowed in favor of persons described of the 7th instant, asking for information in the duty of five per cent. by this section, shall be held trustees" under existing laws. respect to clerks employed in the several to take effect upon the assessments now being made,

Mr. NICHOLSON. I move to amend by Executive Departments of the Government.

and to be collected upon incomes for the year ending
December 31, 1865.

adding at the end of the paragraph the followANDREW JOHNSON.

ing: WASHINGTON, D. C., May 22, 1866.

Mr. MORRILL. This cannot be carried out.
The message and accompanying document
The assessment has already been made.

And provided further, That when any person or were referred to the select committee on the

On agreeing to the amendment, there were

persons, whose annual income from all sources does

not exceed $1,000, shall be possessed of any shares of civil service of the United States, and ordered -ayes 12, noes 55 ; no quorum voting.

stock or interest in any institution or corporation

The CHAIRMAN, under the rule, ordered whose officers have withheld, as required by law, a to be printed. tellers; and appointed Messrs. Ancona and

per cent. of the dividends made by such instituCLOSE OF DEBATE.

tions, and paid the same to the Commissioner of InMORRILL.

ternal Revenue or other officer authorized to receive Mr. MORRILL. I move that all debate in The committee divided ; and the tellers re- the same, such person or persons shall be permitted Committee of the Whole on the state of the ported-ayes 14, noes 79.

to prove and declare, under oath or affirmation, the

amount of their said annual income, and to show by Union on the pending paragraph of the special So the amendment was not agreed to.

certificate of the officers of said institution or corpoorder terminate in one half minute after the

Mr. BERGEN. I move to amend by add-' || ration, the amount so withheld and paid over to them. committee shall resume the consideration of

ing at the end of the paragraph the following: fied with the proof, shall certify the same to the colthe subject.

No passport shall be issued from the State Depart

lector of the district, who shall repay to the person The motion was agreed to.

ment or by any minister, chargé, or consul, to any or persons entitled the amount so withheld and paid. person unless he produces the receipt for all income

Mr. Chairman, the object and necessity of TAX BILL-AGAIN. taxes imposed on him from 1862 to the date of his

this amendment will be apparent at a glance. Mr. MORRILL. I move that the rules be application, nor shall any passport be renewed or

viséed by any minister, chargé, or consnl abroad, The present law has in its practical operation suspended, and that the House resolve itself unless the same conditions be complied with. borne most unjustly and partially upon a into the Committee of the Whole on the state of the Union on the special order.

The amendment was not agreed to; there | class of persons who are least able to suffer The motion was agreed to.

being-ayes fourteen, noes not counted. such injustice. If it is the purpose of this

Mr. ROSS. I move to amend by inserting House to exempt incomes less than $1,000, So the rules were suspended; and the House

at the end of the amendment last adopted the · accordingly resolved itself into the Committee following:

that object should be carried into practical

effect. But it is well known that there is a of the Whole on the state of the Union, (Mr.

And a duty of fifteen per cent. per annum on the large class of persons of small incomes who Dawes in the chair,) and resumed the consid- excess over $50,000.

have not, under the present law received the eration of the special order, being a bill of the The amendment was not agreed to.

benefit of the $600 exemption, and who will House (No. 513) to amend an act entitled "An act to provide internal revenue to sup

Mr. HUBBARD, of New York. I move to not under this bill enjoy the exemption of

amend by inserting after the word “thereof” || $1,000, unless some such amendment as that port the Government, to pay interest on the public debt, and for other purposes,'' approved

in line twenty-four hundred and seventy-five | which I offer be adopted. They have been the following:

obliged to pay a tax of five per cent. upon the June 30, 1864, and acts amendatory thereof.

Provided, That every person, not being a house- whole of their income. I refer especially to The pending question was upon the amend- holder, nor having a family residing in the United those whose income is derived from stocks, ment of Mr. SPALDING,

States, shall pay the aforesaid duty or tax upon the Mr. SPALDING. I will withdraw my excess over $500.

&c., in any corporation or institution the offiamendment, as I mistook the scope of the

The amendment was not agreed to.

cers of which are required by law to withhold

from the dividends, &c., of the stockholders a amendment proposed by the gentleman from Mr. ANCONA. I move to amend by addMaine, [Mr. PiKE.] I greatly prefer his | ing at the end of the paragraph the following: || Commissioner of Internal Revenue.

certain amount of tax to be paid over to the

If the amendment to my own, as he proposes to Provided, That on all incomes derived from labor

amount of income from this source exceeds leave the law as it now stands, with the single and fixed salaries the amount so levied and collected change of exempting $1,000 instead of $600. shall not exceed tbree per cent.

$1,000, the parties are afforded an opportunity The question recurred upon the amendment

The amendment was not agreed to.

of being credited with the amount; but if the of Mr. Ross to the amendment of Mr. PIKE. The Clerk read as follows :

income does not exceed $1,000, no such oppor. The amenderent of Mr. Ross was as fol.

tunity is afforded. The tax is withheld by the That section one hundred and seventeen beamended

bank or other institution; and under the preslows:

by striking out all after the enacting clause and in

serting in lieu thereof the following: that in estiInsert after the words “a duty of five per cent. on

ent law it is impossible for the party to recover the excess over $1.000" the following:

mating the gains, protits, and income of any person, the tax thus unjustly deducted. This system And not exceeding $10,000; and a duty of ton per

there shall be included all income derived from intercent. per annum on the excess over $10,000 and not est upon notes, bonds, and other securities of the Uni

operates injuriously apon a class of persons exceeding $20,000; and a duty of fifteen por cent. per

ted States: profits realized within the ycar from sales composed almost entirely of widows and or.

of real estate purchased within two years previous to annum on the excess over $20,000 and not exceeding

phans, whose investments are made under the $10.000; and a duty of twenty per cent. per annum

thọ year for which income is estimated; interest re-
ceived or accrued upon all notes, bonds, and mort-

order of a court, so that they have no control on the excess over $10,000 and not exceeding $60,000;

gages, or other forms of indebtedness bearing inter- over the investment. and a duty of twenty-five percent. per annum on the

The law in its operation cst, whether paid or not, if good and collectable, less heretofore has presented this anomaly: that excess over $60,000.

the interest which has become due from said person The amendment was not agreed to. during the year; the amount of all premium on gold

while a certain amount of income has been The question recurred upon the amendment

and coupons; the amount of sales of livestock, sugar, exempt by law these parties have been unable

wool, butter, cheese, pork, beef, mutton, or other of Mr. Pike, which was as follows:

to get the benefit of that exemption. meats, hay and grain, or other vegetable or other

Mr. MORRILL. Mr. Chairman, on the face Strike out all after the words "United States,"

productions, being the growth or produce of the estate where they first occur in the paragraph, and insert

of such person, not including any part thereof con- of the gentleman's proposition it seems to be in lieu thereof the following:

sumed directly by the family; all other gains, profits, somewhat fair, but the difficulties of carrying Or of any citizen of the United States residing

and income derived from any source whatever; and abroad, whether derived from any kind of property, the share of any person of the gains and profits of all

it into effect, if passed, are almost insuperable. rents, interests, dividends, or salaries, or from any companies, whether incorporated or partnership, who

In the first place, there are few people who profession, trade, employment, or vocation carried

would be entitled to the same, if divided, whether own bank stock to the amount of $1,000 who on in the United States or elsewhere, or from any

divided or otherwise, except the amount of income other source whatever, a duty of five per cent. on rereived from institutions or corporations whose

do not own something else. If any injustice the amount so derived over $1,000 and not exceeding

officers, as required by law, withhold a per cent. of be done by the provision in the bill, it will then $5.000; and a duty of ten per cent. on the amount the dividends made by such institutions, and pay the


only be in a very small number of cases. exceeding $5,000; and a like duty shall be levied,

same to the Commissioner of Internal Revenue or collected, and paid upon the gains, profits, and in

we inserted the amendment into the law, it other officer authorized to receive the same; and come of crcry business, trade, or profession carried

except the salary or pay received for services in the would give an opportunity to a great many on in the United States by persone residing without civil, military, naval, or other service of the United readjustments, and it would lead to so many bo United States and not citizens thereof.

States, including Senators, Representatives, and Dol- difficulties that I hope it will not be adopted.

egates in Congress from which the tax has been deMr. JENCKES. I move to amend the ducted. And in estimating the gains, profits, and

The amendment was rejected.

the purpose

Mr. THAYER. I move after the word

ascertained to be worthless, but excluding all esti- Wilson,] to insert in line twenty-five hundred "favor" in line twenty-five hundred and mated depreciation of values, and.

and eighteen, after the words "two years,'' the thirty-four to strike out to the end of the sen- I offer this for the purpose of determining words or upon sales of other property;" so tence, as follows:

what loss may be deducted in addition to those that the clause will read: And that no deductionsball be allowed in favor of

now specified by the law. Last year it was Losses on sales of real estate within the year purpersons described as trustees" under existing laws. held by the Commissioner that no loss should chased within two years or upon sales of other propMr. Chairman, I move this amendment for be deducted from the income which was not

erty purchased more than two years previous to the

year for which income is estimated.
of enabling me to ask some gen-
incurred in some business out of which the

The amendment already adopted excludes tleman on the Committee of Ways and Means || party derived a profit, and where the loss to explain what this means.

estimated depreciation of property, but does I want the genincurred overbalanced the amount of profit.

not cover actual losses from the sale of proptlemen of the committee to explain what this | Now, I propose to extend that so that all provision means which excludes trustees from losses from the causes mentioned, either byerty purchased to be held as investments, or of

which the title is derived in some other way the privilege of making in favor of the cestui fire or shipwreck, or incurred in trade, shali be deducted from the income. I think there

more than two years previous. que trust the deductions others are entitled to

Mr. GARFIELD. That would never do. make by law. I will yield to the gentleman can be no objection to it, and I believe the

It would allow a purchase twenty years ago to from Massachusetts to explain it. Committee of Ways and Means concur in the

come in. Mr. MORRILL. I will say to the gentleman | propriety of the amendment. from Pennsylvania that that was introduced at

The amendment was agreed to.

Mr. JENCKES. Not at all.

The amendment was not agreed to. the request of the Commissioner of Internal Mr. DAVIS. I move to amend by inserting

Mr. BIDWELL. I move to insert after the Revenue, who assigned a very good reason for after line twenty-five hundred and thirty-six it, but which has escaped my attention at the the following:

word "estimated," in line twenty-five hundred

and nineteen, as follows: present time.

Provided, That any gains and profits of any comMr. THAYER. I must insist on my amend- pany, association, or partnership which shall be re

But the term real estate as herein used shall not be turned and the tax thereon paid before the same

deemed to include mining stocks or mining claims ment, as I have no idea of "going it blind" on shall be divided, shall to the amount on which such

where the paramount title of the lands on which tho the statement of any person. tax has been paid be exempt from tax when after

mines or claims are situated is in the United States. Mr. HALE. What does the gentleman ward divided.

Mr. WILSON, of Iowa. It seems to me the mean by “going it blind?'' It is a thing Mr. HOOPER, of Massachusetts. I believe | gentleman is not accomplishing what he desires. strange to me.

that is already provided for in the bill. This is a deduction. I suppose he does not Mr. THAYER. It is one of the expressions Mr. DAVIS. I do not find any such provision desire that mining stock shall not be included of the day, and means voting for a thing on in it.

in the deduction. the say-so of some other person when you

The amendment was not agreed to.

Mr. BIDWELL. My object is to prevent do not know who the person is or what he Mr. BERGEN. I move to amend by striking men from deducting losses incurred in mining says. [Laughter.] out the words "labor or” in line twenty-five

claims and mining stocks, calling it real estate. Mr. HOOPER, of Massachusetts. I have hundred and nineteen, and by inserting after Mr. GARFIELD. The language of the no recollection of the provision or that it was

the word “ interest" the words "and the actual amendment is “mining stocks or mining claims adopted in committee.

cost of labor ;'' so that the clause will read: where the paramount title of the lands is in the Mr. MORRILL. It may be a proper pro- The amount actually paid for interest and the actual

United States, As a matter of course they vision as I understand it, without remembering

cost of labor by any person who rents lands, or hires would not be considered real estate. Mining

labor to cultivate land, or who conducts any other the explanation furnished by the Commissioner

stock never was considered real estate. The business from which income is actually derived. of Internal Revenue. The guardian of the estate

The object of the amendment is this: as it

terms are so vague and indefinite that I think should pay the amount due without any deducnow stands the farmer hiring men who board

we ought not to incorporate them in the lawtion. À trustee should not get a deduction on

certainly not “mining stock." themselves charges their entire wages in his his own account and on account of his trust

Mr. BIDWELL. If I am correctly informed, income account, while his neighbor who boards also.

there is a large number of persons who are esMr. THAYER. Of course not. That is

his own men and pays them ten dollars a month
can charge but the ten dollars in his account.

caping the payment of just taxes by saying that not the point affected by these words. The There should be an equality about it. The

their losses in mining should be deducted from paragraph specifies that guardians shall make

their sales of real estate. It is for the purpose these deductions in favor of their wards, and actual cost of the labor should be put in the bill

of saving to the Government the revenue that in such a shape that the board might be reckthen it says trustees shall not make these de. oned in the one case as well as the other.

is its just due that I want this put in. ductions. It says trustees under a deed, mar

The amendment was not agreed to.

purpose of the genriage settlement, or in any other way, shall

tleman is all right, but I think we ought not to not make these deductions. I ask the reason

Mr. HALE. I move to amend by inserting use so indefinite a term. for it.

after the word "purchased” in line twenty-four Mr. BIDWELL. I am willing to let it be Mr. STEVENS. It is unreasonable, and

hundred and eighty-six the words “ within the passed by for further consideration. there is no reason for it. [Laughter.]

year or;" so as to make it grammatical, as The amendment was not agreed to. The amendment was agreed to. follows:

Mr. DODGE. I move to insert after the Profits realized within tho year from sales of rcal Mr. HUBBARD, of Connecticut. I move estate purchased within the year or within two ycars

word "estimated,'' in line twenty-five hundred the following amendment:

previous to the year for which the income is esti- and nineteen, the following:

mated. On page 110, linc twenty-five hundred and twenty

Provided, That money received for leases of coal, three, after the word "repairs," add:

Mr. MORRILL. No objection to that. oro, or limestone lands which exhaust the freehold And ordinary expenses when absent from home The amendment was agreed to.

shall be taxed as sales and not as incomo. relative to matters connected with the business, trade, or profession of such person.

Mr. HALE. I now move to insert after the

The object of the amendment is this: there Mr. Chairman, I offer this amendment at the word “familyin line twenty-five hundred and

are large quantities of lands in the State of request of my friend from Pennsylvania, (Mr. | thirty-three the words and have joint prop- leased

on a royalty, coal lands, for instance


, MILLER.] If he were here he would doubiless

' it explain the object of it much better than I Except that in case where two or more wards are

for a period of ten or fifteen years, the lessees I think it is in harmony with this part

comprised in one family and have joint property | paying ten, twelve, or fifteen cents for the coal

interests only one deduction shall be made in their in the ground, and in the course of ten or fifof the bill as proposed by the Committee of favor.

teen years the entire amount of coal is exWays and Means. It is well known that per

hausted and the land is worthless. This amount sons engaged in business are compelled to go stands seems to be ambiguous. “Except that received from year to year is not income but it abroad to promote the interests of the business | in case where two or more wards are com- is the proceeds of the freehold. Itis the property in which they are engaged. A merchant, for prised in one family.'' That means, I sup- itself. In ten years when the coalis exhausted instance, goes from home to purchase his pose, simply a residence with their guardian | the land in the mountains becomes worthless. goods. The judges of the court in my State as a part of one family. I presume it is only | It is the habit of the assessors to collect from are compelled to travel from county to county, intended to cover the case of those so con- the farmers and others who have leased these and receive $2,000, out of which they are com- nected by relationship or by community of lands the amount they have received for the pelled to pay $500 and more for traveling ex- property that they would constitute what would

property. It is the very life-blood of the proppenses. I think this deduction should be

be considered as one family for the purpose of l erty that is taken. They reckon that as income. allowed.

taxation only, and that I think is properly | At the expiration of the ten years there is no The amendment was rejected.

reached by the amendment I propose.

Not income left, and the owner has two or three Mr. MORRILL. I move, in line twenty. that their property shall be necessarily all joint | hundred acres of land rendered valueless befive hundred and forty-seven, after the word || property, but if they have any joint property cause of the excavation below, or because it "except" to insert the words that portion interests and are members of one family they was of no value except on account of the min. of."

shall have exemption. On the other hand, if eral that was there. The amendment was agreed to.

they have no joint property interest they should Mr. MORRILL. I trust the amendment will Mr. WILSON, of Iowa. I move, before the be treated as individuals.

not be adopted, either in substance or in form, word "loss," in line twenty-five hundred and

The amendment was agreed to.

It will be seen if it is inserted that it will mako seventeen, to insert these words:

Mr. JENCKES. I move an amendment in nonsense of the rest of the paragraph. But it Loss actually sustained during the year arising

order to meet a point not covered by the ought not to be inserted even upon its merits. from firo, shipwreck, or incurred in trado, or debts amendment of the gentleman from Iowa, [Mr. Il There are many similar cases. Take the farmer


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