doubtful expediency, is a matter committed to the discretion of the legislature; and all, or nearly all, of the American statutes contain this exemption, and their constitutionality has not, it is believed, ever been

the constitution, the discrimination referred to is not unlawful. We think it cannot be so shown. To say that the mere fact of inclusion in the one case and exclusion in the other constitutes a reason for holding the law invalid is to say that no excise tax can be lawfully laid upon any privilege until all privileges on which it would be possible to lay such tax have been included within its terms. If this proposition were established, it is difficult to see why it would not invalidate all the excise laws of the state, many of which have been subjected to judicial scrutiny and have been sustained."

In Minot v. Winthrop, 162 Mass. 113, 26 L. R. A. 259, 38 N. E. 512, the court says: "It is also contended that the tax is unreasonable on account of the exemption contained in the proviso of the first section of the statute, that no estate shall be subject to the provisions of this act unless the value of the same, after the payment of all debts, shall exceed the sum of ten thousand dollars. In all, or nearly all, systems of taxation, there are some exemptions, but the objection here is that estates whose value, after payment of all debts, shall not exceed ten thousand dollars, are exempt, without regard to the value of the property received by the devisees, legatees, heirs, or distributees. It is argued that the excise, if upon the privilege of taking property by will or descent, should be the same whenever the privilege enjoyed is the same, in kind and extent, whatever may be the value of the estate, and that the exemptions should relate to the value of the property received by those who have the privilege of receiving it, and not to the value of the estate. But the right or privilege taxed can, perhaps, be regarded either as the right or privilege of the owner of property to transmit it on his death, by will or descent, to certain persons, or as the right or privilege of these persons to receive the property. The tax, too, has some of the characteristics of a duty on the administration of the estates of deceased persons. The cost of administering small estates is proportionately greater than that of administering large ones, and this, of itself, particularly in intestate estates, operates to diminish the amounts received very much as a tax would. The statutes of the different states and nations which have levied taxes on devises, legacies, and inheritances have usually made exemptions, and these have sometimes related to the value of the estates, and sometimes to the value of the property received by the heirs, devisees, legatees, or distributees. The exemption in the statute under consideration is certainly large as an exemption of estates; but it is peculiarly within the discretion of the legislature to determine what exemptions should be made in apportioning the burdens of taxation among those who can best bear them, and we are not

denied." The Missouri statute, imposing a collateral inheritance tax, but exempting bequests for charities without limiting the amount thereof, does not violate the provisions of the constitution of that state which. prohibits laws exempting property held for charitable purposes from taxation in excess of a specified amount, for an inheritance tax is not a tax on property." The statutes of other states have been held not unconstitutional because excluding foreign charitable corporations from the exemption.28

§ 26. Progressive Rate of Taxation. The progressive theory of inheritance taxation, whereby the tax rate is made to increase with the value of the estate transmitted, has come into especial prominence since its adoption by Great Britain in the finance act of 1894. In some of the American states the progressive rate is applied to both direct and collateral heirs, while in others it is applied only to distant relatives and strangers. Although this system of taxation results in a measure of inequality, it is supported by the authorities generally, and is not repugnant to constitutional principles. Authority to make the tax progressive in accordance with the size of the estate satisfied that this exemption is so clearly unreasonable as to require us to declare the statute void."

In Black v. State, 113 Wis. 205, 90 Am. St. Rep. 853, 89 N. W. 522, it is decided that when a statute imposing inheritance taxes undertakes to exempt therefrom all estates whose value is less than ten thousand dollars, the beneficiaries being of the same class, and the tax being levied without regard to the amount received by the individual beneficiary, the classification is arbitrary, and the statute therefore unconstitutional.

26 Thompson v. Kidder, 74 N. H. 89, 12 Ann. Cas. 948, 65 Atl. 392. 27 State v. Henderson, 160 Mo. 190, 60 S. W. 1093.

28 Estate of Speed, 216 Ill. 23, 108 Am. St. Rep. 189, 74 N. E. 809, affirmed in 203 U. S. 553, 8 Ann. Cas. 157, 51 L. Ed. 314, 27 Sup. Ct. Rep. 171; Humphreys v. State, 70 Ohio St. 67, 101 Am. St. Rep. 888, 1 Ann. Cas. 233, 65 L. R. A. 776, 70 N. E. 957,

is based upon the wholesome doctrine that the ability to pay is the true basis of all taxation.29

When the validity of a progressive tax imposed by federal government was challenged in Knowlton v. Moore, the supreme court observed: "The review which we have made exhibits the fact that taxes imposed with reference to the ability of the person upon whom the burden is placed to bear the same have been levied from the foundation of the government. So, also, some authoritative thinkers and a number of economic writers contend that a progressive tax is more just and equal than a proportional one. In the absence of constitutional limitation, the question whether it is or is not is legislative and not judicial.

29 State v. Handlin (Ark.), 139 S. W. 1112; Estate of Magnes, 32 Colo. 527, 77 Pac. 853; Appeal of Nettleton, 76 Conn. 235, 56 Atl. 565; Kochersperger v. Drake, 167 Ill. 122, 41 L. R. A. 446, 47 N. E. 321; Union Trust Co. v. Durfee, 125 Mich. 487, 84 N. W. 1101; State v. Bazille, 97 Minn. 11, 7 Ann. Cas. 1056, 6 L. R. A., N. S., 732, 106 N. W. 93; State v. Vinsonhaler, 74 Neb. 675, 105 N. W. 472; State v. Clark, 30 Wash. 439, 71 Pac. 20; Nunnemacher v. State, 129 Wis. 190, 9 Ann. Cas. 711, 9 L. R. A., N. S., 121, 108 N. W. 627.

In this last case the Wisconsin court said: "The question has been met in other courts, and it has been held with substantial uniformity that the progressive feature does not violate the general guaranties of equality and equal protection of the laws contained in the various state constitutions and in the fourteenth amendment to the constitution of the United States: Knowlton v. Moore, 178 U. S. 41, 44 L. Ed. 969, 20 Sup. Ct. Rep. 747. The decision of the supreme court of the United States as to the force of the fourteenth amendment is necessarily conclusive; and, as the general equality guaranties of our own constitution are substantially the equivalent of the equal protection of the laws guaranteed by the fourteenth amendment, we are content to follow the decisions of the United States supreme court, and hold the progressive feature does not violate the constitution."

This question is ably discussed by the South Dakota court in Estate of McKennan (S. D.), 130 N. W. 33, where it is held that a method of progression whereby the higher rate, in the case of larger estates, is levied upon the whole value of the property transmitted, rather than merely on the excess in value over the amount subject to the next lower rate, does not violate the constitutional requirement that all taxation shall be equal and uniform.

The grave consequences which it is asserted must arise in the future, if the right to levy a progressive tax be recognized, involves in its ultimate aspect the mere assertion that free and representative government is a failure, and that the grossest abuses of power are foreshadowed unless the courts usurp a purely legislative function. If a case should ever arise where an arbitrary and confiscatory exaction is imposed bearing the guise of a progressive or any other form of tax, it will be time enough to consider whether the judicial power can afford a remedy by applying inherent and fundamental principles for the protection of the individual, even though there be no express authority in the constitution to do so. That the law which we have construed affords no ground for the contention that the tax imposed is arbitrary and confiscatory is obvious." 20

§ 27. Double Taxation in Case of Nonresidence.— It not infrequently happens that personal property suffers a species of double taxation by reason of the circumstance that it is actually situated in one state while the owner dies domiciled in another state. In such event the actual situs of the property is seized upon by the first state as warranting the imposition of an inheritance tax, and the legal situs of the property at the domicile of the decedent is taken as authorizing the imposition of another inheritance tax by the latter state. Indeed, the same state may assume either position, as the domicile of the deceased or the presence of his personalty within the state may require, in order to collect the tax. This form of double taxation, however unjust it may seem, and into whatever inconsistencies it may lead the taxing author

30 Knowlton v. Moore, 178 U. S. 41, 44 L. Ed. 969, 20 Sup. Ct. Rep.

ities, is not opposed to constitutional principles," but it is being departed from in some of the states. For instance, the West Virginia statute, which is fairly representative of other recent statutes, now provides:

"A transfer of personal property of a resident of the state which is not therein at the time of his death shall not be taxable, under the provisions of this act, if such transfer or the property be legally subject in another state or country to a tax of a like character and amount to that hereby imposed, and if such tax be actually paid, or guaranteed or secured, in accordance with law in such other state or country; if legally subject in another state or country to a tax of like character, but of less amount than that hereby imposed, and such tax be actually paid, or guaranteed or secured, as aforesaid, the transfer of such property shall be taxable under this act to the extent of the difference between the tax thus actually paid, guaranteed or secured, and the amount for which such transfer would otherwise be liable hereunder. A transfer of personal property of a nonresident deceIdent which is within this state at the time of his death, if subject to a tax of a like character, with that imposed by this act, by the law of the state or country of his residence, shall be subject only to such portion of the tax hereby imposed by the laws of such state or country; provided, a like exemption is made by the laws of such other state or country in favor of estates or citizens of this state, and the transfer thereof, but no such exemption shall be allowed until such tax provided for by the law of such other state or country shall be actually paid, guaranteed or

31 Estate of Stanton, 142 Mich. 491, 105 N. W. 1122; Douglas County v. Kountze, 84 Neb. 506, 121 N. W. 593; Blackstone v. Miller, 188 U. S. 189, 47 L. Ed. 439, 23 Sup. Ct. Rep. 277. See the chapter on "Situs of Property for Purposes of Taxation," post, section 170 et seq.