PRINCIPLES OF TAXATION. 387 



In almost one of the first cases that came before the United States 

 Supreme Court after the adoption of the Constitution it was decided 

 that a tax on carriages, the payment of which was resisted by one 

 Ilylton, of Virginia, on the ground that such a tax was a direct tax, 

 and had not been apportioned among the States as required by the 

 Constitution, the court held that the tax in question was to be con- 

 sidered as a tax on the expenses of living and not a direct tax within 



number of representatives. Mr. Carroll, of Maryland, replied that " the number of repre- 

 sentatives did not admit of a proportion exact enough for a rule of taxation " (Elliot's 

 Debates, v, 451). Mr. Ellsworth "thought such a rule unjust. There was a great differ- 

 ence between the number of inhabitants, as a rule, in this case. Even if the former were 

 proportioned as nearly as possible to the latter, it would be a very inaccurate rule. A State 

 might have one representative only, that had inhabitants enough for one and a half or more, 

 if fractions could be applied " (ibid., 453). Mr. GeiTy's motion was defeated. The con- 

 vention, after debate, decided that direct taxes must be apportioned in the States in more exact 

 ratio to the population than the representatives could pjossibly he apportioned (Elliot, v, 453). 



Many of the leading patriots of the Revolution — Patrick Henry among them — were 

 distrustful of granting this power, even with the restriction placed upon its exercise. 

 Massachusetts accompanied her adoption of the Constitution with a resolution, signed by 

 John Hancock, recommending an amendment of the Constitution which should prohibit 

 Congress from levying a direct tax until they should first have made a requisition on the 

 States (I Elliot, 323). The same amendment, word for word, was recommended by the 

 State of New York and the State of North Carolina, and similar resolutions were adopted 

 by South Carolina, Rhode Island, and Virginia. 



In the apportionment of the direct taxes which had been laid by Congress previous to 

 the income tax the ratio to the census was preserved with scrupulous accuracy, and the 

 actual use of the authority up to the time of the imposition of the income tax was in 

 accordance with the understanding of the framers of the Constitution. 



Mr. Madison, who was probably the most active participant and member in the convention 

 that framed the Constitution of the United States, in a letter written after the adoption of 

 the Constitution but before the organization of the new Government, and never discovered 

 (by Mr. Worthington Ford) and its contents made pubhc until 1895, embodies much new 

 information in regard to the intent and purpose of the term " direct " taxes as used in the 

 Constitution and in regard to the understanding of the people of the United States concern- 

 ing that term when they adopted the Constitution. It shows, what is extraordinary, "that 

 the term, in the estimation of the men who used it, did not refer to the kind, or character, 

 or nature of the tax itself, and that the framers of the Constitution never considered the 

 subject of taxation from the philosophical or politico-economic point of view, but were 

 wrestling with the stern necessities of the question, How shall the people of these several 

 States be induced to pay a Federal tax ? 



" Manifestly, it could be raised by but one of two methods : either indirectly, by ' requi- 

 sitions ' on the several States, as under the still existing Confederacy, or by taxes laid 

 directly by the Federal Government. Duties and excises were not indirect taxes ; they were 

 not under discussion or consideration ; they were not in the case at all. Indirect taxes were 

 taxes procured indirectly by ' requisitions ' on the States ; direct taxes were taxes laid directly 

 by the Federal Govermnent. The framers of the Constitution evidently had never looked 

 at the subject from a politico-economic point of view ; they had never given a thought to 

 the philosophy of taxation ; the term ' direct taxes,' as they used it, did not refer to the 

 kind or character or nature of the tax, but to the fact that such taxes were no longer to be 

 laid indirectly through ' requisitions ' upon the States, but directly upon the taxpayer by the 

 newly constituted taxing power. Indirect taxes would be a thing of the past, of the 



