This last paragraph seems to be pieced together with some stuff from BRUSHABER v. UNION PACIFIC R. CO.. The last sentence states the 16th amendment is limited to indirect taxes, which Stanton v. Baltic Mining stated the income tax was. I think I'm missing something here.
By contrast, an indirect tax is a tax that you can avoid by choosing notbecome involved in the activity upon which the tax is laid. An example ofthis might be importing products from another country into the UnitedStates. In such a circumstance one is required to pay an import duty.However, one can avoid paying an import duty simply by not importingforeign products into this country. Another example might be distillingrum in the Virgin Islands and importing it into the states of the Union.If one wishes to avoid the taxes involved in such a process, one need onlyto refrain form the activity.In short, an indirect tax is a tax that you can choose to avoid withoutgiving up the normal affairs of life. However, if one cannot avoid ataxable activity without sacrificing the ordinary affairs of life, the taxis not indirect, but direct. Thios is in error, indirect is just avoidable, not inconvenient.
Edwards v. Keith, 231 Fed 1:
"One does not derive income by rendering services and
charging for them."
Conner v. U.S., 303 F.Supp. 1187 (1969) on page 1191:
"If there is no gain there is no income ... Congress
has taxed income not compensation."
Wilby v. Mississippi, 47 S 465:
"It certainly was not the intention of the
legislature to levy a tax upon honest toil and labor."
Staples v. U.S., 21 F.Supp. 737, 739 (1937):
"Income is not a wage or compensation for any type of
labor."
U.S. v. Ballard, 400 F2d 404 (1976):
"The general term 'income' is not defined in the
Internal Revenue Code."
Spring Valley Water Works v. Barber, 33 P 735:
"A right common in every citizen such as the right to
own property or to engage in business of a character
not requiring regulation CANNOT, however, be taxed as
a special franchise by first prohibiting its exercise
and then permitting its enjoyment upon the payment of
a certain sum of money."
Tennessee Supreme Court in Jack Cole v. Commissioner MacFarland, 337
SW2d 453 (1960):
"The right to receive income or earnings is a right
belonging to every person, and realization and
receipt of income is therefore not a "privilege that
can be taxed." [from:Taxation West Key 933]
In this 1960 case, the Tennessee Supreme Court also quoted prior
decisions that defined the term `privilege' in contradistinction to
right:
"Legislature ... cannot name something to be a
taxable privilege unless it is first a privilege."
"Privileges are special rights, belonging to the
individual or class, and not to the mass; properly,
an exemption from some general burden, obligation or
duty; a right peculiar to some individual or body"
US Supreme Court in McCulloch v. Maryland, 4 Wheat 316:
"If it could be said that the state had the power to
tax a right, this would enable the state to destroy
rights guaranteed by the constitutions through the
use of oppressive taxation. ... The power to tax
involves the power to destroy."
U.S. Supreme Court in Butcher's Union v. Crescent City, 111 US 746:
"The property which every man has in his own labor,
as it is the original foundation of all other
property, so it is the most sacred and inviolable. ...
to hinder his employing this strength and dexterity
in what manner he thinks proper without injury to his
neighbor, is a plain violation of this most sacred
property."
Oliver v. Halstead, 86 SE2d 859 (1955):
"There is a clear distinction between 'profit' and
'wages' or compensation for labor. Compensation for
labor cannot be regarded as profit within the meaning
of the law."
Stratton's Independence v. Howbert, 231 US 309 (1913):
"Income ... may be defined as the gain derived from
capital or from labor or from both combined."
The Supreme Court in Eisner v. Macomber, 40 SCt 192 and 252 US 189
(1920) and subsequently reaffirmed in Goodrich v. Edwards, 255 US 527
(1921):
* "... it becomes essential to distinguish between
what is, and what is not 'income'...
* "Congress may not, by any definition it may adopt,
conclude the matter, since it cannot by legislation
alter the Constitution, from which alone it derives
its power to legislate, and within whose limitations
alone, that power can be lawfully exercised ...."
* "Income may be defined as gain derived from capital,
from labor or from both combined, provided it be
understood to include profits gained through sale or
conversion of capital assets."
In the 1959 Tax Court case Penn Mutual Indemnity Co. v. Commissioner,
32 Tax Court page 681:
"The rule of Eisner v. Macomber has been reaffirmed
on so many occasions that citation of the cases to
this effect would be unnecessarily burdensome. To
depart from the rule at this late date would ignore
the sound principles upon which that case was decided
and would throw into confusion the fundamental income
tax structure and law as it has developed in the
almost half century which has elapsed since adoption
of the 16th amendment. That there cannot be 'income'
without a 'gain' accords with the common
understanding of the term, a test of construction
which is particularly appropriate in our system of
self-assessed Federal income tax ... Moreover, that
which is not income in fact manifestly cannot be made
such by the legislative expedient of calling it income
...."
So. Pacific v. Lowe, 238 F. Supp. 736, 247 US 330:
"'income' as used in the statute should be given a
meaning so as not to include everything that comes in.
The true function of the words 'gains' and 'profits'
is to limit the meaning of the word 'income'.
Laureldale Cemetery Assoc. v. Matthews, 345 A 239, and 47 A.2d 277
(1946):
"Reasonable compensation for labor or services
rendered is not profit."
U.S. Supreme Court in Murdock v. Pennsylvania, 319 US 105, at 113 (1943):
"A state may not ... impose a charge for the e
njoyment of a right granted by the Federal
Constitution."
U.S. Supreme Court in Magnano Co. v. Hamilton, 292 US 40:
"The power to tax the exercise of a [ right ] ... is
the power to control or suppress its enjoyment."
President Jefferson, concluding his first inaugural address, March 4,
1801:
"... a wise and frugal government, which shall
restrain men from injuring one another, which shall
leave them otherwise free to regulate their own
pursuits of industry and improvement, and shall not
take from the mouth of labor the bread it has earned.
This is the sum of good government … "
Spreckels Sugar Ref. Co. v. Mclain, 24 SCt 382 (1904):
"the citizen is exempt from taxation unless the same
is imposed by clear and unequivocal language."
Oregon Supreme Court in Redfield v. Fisher, 292 P 813, pg 819 (1930):
"The individual, unlike the corporation, cannot be
taxed for the mere privilege of existing. The
corporation is an artificial entity which owes its
existence and charter powers to the state: but the
individuals' right to live and own property are
natural rights for the enjoyment of which an excise
cannot be imposed."
Long v. Ramussen, 281 F 236, 238 (1922):
"The revenue laws are a code or system in regulation
of tax assessment and collection. They relate to
taxpayers, and not to non-taxpayers. The later are
without their scope. No procedure is prescribed for
non-taxpayers, and no attempt is made to annul any of
their rights and remedies in due course of law. With
them Congress does not assume to deal, and they are
neither of the subject nor of the object of the
revenue law."
Reaffirmed in Gerth v. US, 132 F. Supp. 894 (1955) and
in Economy Heating Co. v. U.S., 470 F2d 585 (1972)
Regal Drug Co v. Wardell, 260 US 386:
"Congress may not, under the taxing power, assert a
power not delegated to it by the Constitution."
U.S. Supreme Court in Hurtado v. California, 110 US 516:
"The state cannot diminish the rights of the people."
Sherar v. Cullen, 481 F2d 946(1973)
"... there can be no sanction or penalty imposed upon
one because of his exercise of constitutional rights."
Miller v. U.S., 230 F 489
"The claim and exercise of a Constitutional right
cannot be converted into a crime."
ALL taxes must be either excises, duties, posts, or if direct, apportioned. How the tax is applied is what determines the class it falls into. If it affects any real or personal property, and cannot be passed on to another, it must be apportioned. If it does not affect such, it doesn't require apportionment, it requires uniformity . A tax on income is perfectly legal and moral, regardless of source, so long as the source is not affected. Defining "income" is the hard part.
If I buy a car for $10,000 and sell it a week later for $10,000, there is no income, hence no tax due because such a tax would diminish the original $10,000 sum I owned. As such, if I own 40 hours of labor, and trade them for any monetary amount, no tax can be due because such a tax would diminish the original value of my labor. Wages and labor can be a SOURCE of income, for example, for someone who owned a staffing service or temp agency and received their money based on someone else's labor. Or in the case of a union collecting dues from others' labor. The tax is on the INCOME DERIVED FROM A SOURCE, not the source itself. Labor can be a source of income, but is not necessarily income per se.
So whether YOU or the SUPREME COURT classify an income tax as an excise is really irrelevant . How the tax is applied will determine the class it MUST fall into , and constitutional rules governing the 2 great classes would then be applied.
But for the record, the tax we now know as "income tax" , was pre-dated by the "CORPORATE EXCISE TAX of 1909".
It was originally designed as an excise tax for the privilege of corporate chartership.
The only way the 16th amendment can be read is in harmony with previous provisions for taxation, as it neither repeals or nullifies any portion thereof. Same as any law..you can't read one line of a law and determine what is required, you MUST read the law as a whole.
