Historical Perspectives on the Federal Income Tax
“The enlightened patriots who framed our Constitution, and the people who adopted it, must be understood to have employed words in their natural sense, and have intended what they have said.”
Gibbons v. Ogden, 22 U. S. 9 Wheat
Apportionment: Webster’s New Encyclopedic Dictionary 1996
Apportion: To divide and distribute proportionately
The apportioning of Representatives or taxes among States or districts
according to population. (In this way the states
knew from their respective populations how many Representatives they would
have and how much of a direct tax they would be responsible for paying)
“But the acceptance of the rule of apportionment was one of the compromises which made the adoption of the Constitution possible, and secured the creation of that dual form of government, so elastic and so strong, which has thus far survived in unabated vigor. If by calling a tax indirect when it is essentially direct, the rule of protection could be frittered away, one of the great landmarks defining the boundary between the Nation and the States of which it is composed, would have disappeared, and with it one of the bulwarks of private rights and private property.” Chief Justice Fuller, Opinion of the Court, Pollock v. Farmers 157 us 427 @ 583
Assess: Webster’s New Encyclopedic Dictionary:
Assessed: 1: to fix the rate or amount of. 2: to set the value on (as property) for tax purposes. 3: to lay a tax or charge on (the city assessed all car owners $5.00)
Business: Blacks Law Dictionary
Business is a very comprehensive term and embraces everything about which
a person can be employed. People ex. Rel. Hoyt v. Tax Comrs. 23 N.Y.
Business: 1 Bouvier’s Law Dictionary page 273
That which occupies the time, attention, and labor of men for the purpose
of a livelihood or profit.
Business: Webster’s New Encyclopedic Dictionary
Business: 1a: an activity that takes a major part of the time, attention, or effort of a person or group. b: a commercial or mercantile activity engaged in as a means of livelihood.  Syn. Business, commerce, trade, industry mean activity in supplying commodities. Business may be an inclusive term but specifically applies to the activities engaged in the sale and purchase of commodities or in related transactions.
Capitation: Webster’s New Encyclopedic Dictionary
Capitation: Poll: from Latin “caput” Head
“…upon the person simply without any reference to his property, real or personal, or any business in which he may be engaged, or to any employment which he may follow. It is rightfully imposed, because of the protection which the government affords to the person independently of the connection in relation of the person to anything else.” Gardner v. Hall, 61 N. C. 21. Pollock v. Farmers 157 US 427 @ 774 from briefs of U. S. Council Attorney General Richard Olney
Derive: Webster’s New Encyclopedic Dictionary
1a: to receive or obtain from a source
Derived: Eisner v. Macomber 252 U. S. 189 @207
Derived: “but a gain, a profit, something of exchangeable value proceeding from the capital, however invested or employed, and coming in, being “derived”, that is, received or drawn by the recipient (the taxpayer) for his own separate use, benefit, and disposal; that is income derived from property.
Direct Tax: Senator McLauren, Congressional Record - Senate July 5, 1909, Page 4109
think the word “direct” there must be construed with reference to the word
“Capitation”. A Capitation Tax is a tax that is levied directly
upon the individual without reference to property. It is what
is called in the States generally a “Poll Tax”. When you speak
of a “Capitation” tax as a direct tax then speak of “other direct taxes”
the word “direct” in this connection must be construed ejusdem generis
with reference to the word “Capitation” ---a Capitation” Tax; that is,
a direct tax which operates upon the individual himself, without reference
to any property at all---and the words “or other direct” of course, always,
by the rules of construction, must be construed to mean a tax of the same
kind. Other direct taxes, that operate upon the individual
without reference to any property at all. Out of that confusion
has grown all the trouble that has arisen in reference to the question
of an income tax."
Justice Fuller summed up all of the arguments, relating to direct taxes,
presented in the Pollock Cases with this statement from Polllock v. Farmers
158 US 601 @625-6:
“He gives, however, it appears to us, a definition which covers the question before us. A tax upon one’s whole income is a tax upon the annual receipts from his whole property, and as such falls within the same class as a tax up on that property and is a direct tax in the meaning of the Constitution.” (a tax upon all that comes in)
Employment: Webster’s New Encyclopedic Dictionary:
Employment: 1: use. 1a, purpose; also: the action of using. 2a: the act of engaging a person for work: hiring. b: the work in which one is employed: occupation
Excise: Webster’s New Encyclopedic Dictionary:
an internal tax levied on the manufacture, sale and consumption of a commodity
within the country.
Excise Tax: Hyde v. Continental Trust 157 U. S. 586:
Tax: Excises are a species of tax consisting generally of duties
laid upon the manufacture, sale or consumption of commodities within the
country; or upon certain callings or occupations, often taking the form
of exaction for licenses to pursue them.”
“We have considered the Act only in respect of the tax on income derived from real estate, and from invested personal property, and have not commented on so much of it as bears on gains and profits from business, privileges, or employment’s, in view of the instances in which taxation on business, privileges, or employment’s has assumed the guise of an excise tax and been sustained as such.” Pollock v. Farmers 158 U.S. 601 @ 635
Indirect Tax: Webster’s New Encyclopedic Dictionary
tax: a tax extracted from a person other than the one on whom the ultimate
burden of the tax is expected to fall.
“…that indirect taxes are levied upon consumption as it is called, always takes the thing in movement---transactions among men, in respect to which they are the masters of their own conduct, and therefore, are not regulated as to how much tax they will pay, according to the kind of business they choose to carry on, and the amount and value, etc. of the commodities they choose to consume.” Mr. Edmonds
Is not the distinction somewhat like this: That direct taxes are paid by the taxpayer both immediately and ultimately; while indirect taxes are paid immediately by the taxpayer and ultimately by someone else? Justice Brown Pollock v. Farmers 157 US 427 @ 786 of briefs.
Income: Webster’s Dictionary 1934
that gain or recurrent benefit (usually measured in money) which proceeds
from labor, business or property: commercial revenue or receipts
of any kind. The total receipts from any branch of business are known
as gross income. That portion of the receipts which remains
after paying wages and for materials is known as net income, which is in
turn subdivided into interest on the capital invested and profits over
and above this interest.
Income: Eisner v. Macomber 252 US 189 @ 207
may be defined as the gain derived from capital, from labor, or from both
combined, provided it be understood to include profit gained through a
sale or conversion of capital assets.
Income: 42 C.J.S. page 529 (1944) “Generally or ordinarily the term means all that comes in; … something which is paid over and delivered to the recipient; … without reference to the outgoing expenditures.” Cited in Lukhard v. Reed 481 U.S. 368 (1987).
Labor: Bouvier’s Law Dictionary page 1811
Work requiring exertion or effort, either physical or mental; toil.
Labor and business are not synonymous; Labor may be business, but not necessarily
so, and business is not always labor. The labor and skill of one
man are frequently used in a partnership, and valued as equal to the capital
Labor: Webster’s New Encyclopedic Dictionary
Labor: b(1): human activity that provides the good and services in an economy
(2): the services performed by workers for wages as distinguished from those rendered by entrepreneurs for profits.
Occupation: Webster’s New Encyclopedic Dictionary:
Occupation: an activity in which one engages: esp. one’s business or vocation.
Profession: Webster’s New Encyclopedic Dictionary:
Profession: 4a: a calling requiring specialized knowledge and academic preparation. b: a principal employment
Receipt: Webster’s New Encyclopedic Dictionary
Receipt: 2: the act or process of receiving 3: something received---usually used in plural 4: a writing acknowledging the receiving of goods or money
Source: Webster’s New Encyclopedic Dictionary
b (1): a point of origin. 2: the point of origin of a
stream of water:
Source: 16th Amendment: Reference is to capital and or labor; that which produces the taxable receipts.
Subject: Webster’s New Encyclopedic Dictionary
Subject: 1: one that is placed under authority or control. 1a: one subject to a monarch and governed by the monarch’s law. 4: a noun or noun equivalent about which something is stated by the predicate.
Trade: Webster’s New Encyclopedic Dictionary:
Trade: 2a: the business or work in which one engages regularly: occupation. 3a:
the business of buying and selling or bartering commodities: commerce
Uniformity: U. S. Constitution Article 2 Section 8
all Duties, Imposts and Excises shall be uniform throughout the United
phraseology of the previous resolution was changed so as to cause the word
to have merely a geographical significance, viz., to require that whatever
subject of taxation was assessed, the same subject should be taxed in every
state, or, in other words, that the particular tax should operate generally
throughout the United States.” Knowlton V. Moore 178 US 41
simply requires whatever plan or method Congress adopts for laying the
tax in question, the same plan and the same method must be made operative
throughout the United States; that is to say, that wherever a subject is
taxed anywhere, the same must be taxed everywhere throughout the United
States, and at the same rate.” Knowlton Supra
Uniformity: United States v. Singer, 15 Wall. 111,121
law is not in our judgment subject to any constitutional objection.
The tax imposed upon the distiller is in the nature of an excise, and the
only limitation upon the power of Congress in the imposition of taxes of
this character is that they shall be uniform throughout the United States.
The tax here is uniform in its operation; that is, it is assessed equally
upon all manufactures of spirits, wherever they are. The law
does not establish one rule for one distiller and a different rule for
another, but, the same rule for all alike.”
tax is uniform when it operates with the same force and effect in every
place where the subject of it is found.” Justice Miller Edye
v. Robertson Head Money Cases 112U. S. 580, 594
Uniformity: Home Ins. Co. v. State of New York 134 U.S. 594 (1890)
“There is the same rule, applicable to all under the same conditions, in determining the rate of taxation. There is no discrimination in favor of one against another of the same class.
Vocation: Webster’s New Encyclopedic Dictionary:
Vocation: 2a: the work in which one is regularly employed:
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