was absurdly high, considering the much superior quality of the imported Hong Kong opium, which was taxed by the same act at twelve dollars a pound, a tax since reduced by the act of August 28, 1894, to six dollars per pound. The requirement that the manufacturer should be a citizen of the United States excluded all Chinese from the business; and, as only the Chinese know anything about the manufacture of smoking- opium, this provision would seem to indicate a design on the part of Congress to suppress the domestic manufacture. But the law is absurdly defective in its penal provisions, and Congress has never seen fit to amend it, although twice requested by the Commissioner of Internal Revenue to do so. The result has been chiefly to promote the illicit manufacture of smoking-opium, and to bring into full play those underground arts of which the Chinese are past masters. I believe that, although this act has been law for four years, only $875 has ever been collected under it, and this was from stamps bought to stamp illicit, unstamped opium seized and sold, and no person has ever qualified as a lawful manufacturer. The useless regulations framed for the use of lawful manufacturers, of whom there are none, are known as Int. Rev. Reg., Series 7, No. 16. Crude or unmanufactured opium, not adulterated, and containing over nine per cent of morphia, from which the domestic smoking-opium is made, as well as all our preparations and tinctures of which opium forms a part, has been for four years free from duty. There is no raw or crude opium made in the United States, so far as known. Sec. CHAPTER SIXTEEN. THE INCOME TAX LAW OF 1894. Act August 28, 1894. Sec. 33. Tax on salaries of United States officers over $4,000. 27. Annual income tax imposed. 28. Inclusions to be made and deductions allowed in estimating in- 34. [Amends Secs. 3167, 3172, 3173, come. 29. By whom returns are to be made. Penalties for neglect or making false returns. Appeals to commissioner. 30. When tax is due and payable. Penalty for non-payment. 31. Income of non-resident persons and corporations. 32. Annual tax on net profits of corporations. and 3176 R. S.]. 3167 R. S. Officer disclosing operation of manufacturer, or contents of any income return. Penalty. 3172 R. S. Canvass of districts. 3176 R. S. When collector may enter 35. Returns of corporations. Penalties for neglect or refusal to 36. Books of corporations. make statement. Exemptions from tax. 37. Duty of collectors to give receipts. Act Aug. 28, Annual income tax on citizens and residents imposed for years 1894 to 1899 inclusive; SEC. 27. That from and after the first day of January, eighteen hundred and ninety-five, and until the first day of January nineteen hundred, there shall be assessed, levied, collected, and paid annually upon the gains, profits, and income received in the preceding calendar year by every citizen of the United States, whether residing at home or abroad, and every person residing therein, whether said gains, profits, or income be derived from any kind of property, rents, interest, dividends, or salaries, or from any profession, trade, employment, or vocation carried on in the United States or rate two per elsewhere, or from any other source whatever, exemption a tax of two per centum on the amount so derived over and above four thousand dollars; and a cent; $4,000. was absurdly high, considering the much superior quality of the imported Hong Kong opium, which was taxed by the same act at twelve dollars a pound, a tax since reduced by the act of August 28, 1894, to six dollars per pound. The requirement that the manufacturer should be a citizen of the United States excluded all Chinese from the business; and, as only the Chinese know anything about the manufacture of smoking-opium, this provision would seem to indicate a design on the part of Congress to suppress the domestic manufacture. But the law is absurdly defective in its penal provisions, and Congress has never seen fit to amend it, although twice requested by the Commissioner of Internal Revenue to do so. The result has been chiefly to promote the illicit manufacture of smoking-opium, and to bring into full play those underground arts of which the Chinese are past masters. I believe that, although this act has been law for four years, only $875 has ever been collected under it, and this was from stamps bought to stamp illicit, unstamped opium seized and sold, and no person has ever qualified as a lawful manufacturer. The useless regulations framed for the use of lawful manufacturers, of whom there are none, are known as Int. Rev. Reg., Series 7, No. 16. Crude or unmanufactured opium, not adulterated, and containing over nine per cent of morphia, from which the domestic smoking-opium is made, as well as all our preparations and tinctures of which opium forms a part, has been for four years free from duty. There is no raw or crude opium made in the United States, so far as known. 1 Sec. CHAPTER SIXTEEN. THE INCOME TAX LAW OF 1894. Act August 28, 1894. 27. Annual income tax imposed. Sec. 33. Tax on salaries of United States officers over $4,000. tions allowed in estimating in- 34. [Amends Secs. 3167, 3172, 3173, come. 29. By whom returns are to be made. Penalties for neglect or making false returns. Appeals to commissioner. 30. When tax is due and payable. Penalty for non-payment. 31. Income of non-resident persons and corporations. 32. Annual tax on net profits of corporations. and 3176 R. S.]. 3167 R. S. Officer disclosing operation 3172 R. S. Canvass of districts. tax. 3176 R. S. When collector may enter Penalties for neglect or refusal to 36. Books of corporations. make statement. Exemptions from tax. 37. Duty of collectors to give receipts. Act Aug. 28, 1894. Annual income tax on citizens and residents years 1894 to imposed for 1899 inclusive; SEC. 27. That from and after the first day of January, eighteen hundred and ninety-five, and until the first day of January nineteen hundred, there shall be assessed, levied, collected, and paid annually upon the gains, profits, and income received in the preceding calendar year by every citizen of the United States, whether residing at home or abroad, and every person residing therein, whether said gains, profits, or income be derived from any kind of property, rents, interest, dividends, or salaries, or from any profession, trade, employment, or vocation carried on in the United States or elsewhere, or from any other source whatever, exemption a tax of two per centum on the amount so derived over and above four thousand dollars; and a rate two per cent; $4,000. residents like tax shall be levied, collected, and paid annually upon the gains, profits, and income from all property owned, and of every business, trade, or profession carIncome of non- ried on in the United States, by persons retaxed. siding without the United States. And the tax herein provided for shall be assessed by the Commissioner of Internal Revenue and collected and paid upon the gains, profits, and income for the year endTo be assessed ing the thirty-first day of December next preceding the time for levying, collecting, and calendar year. paying said tax. and collected on income of the preceding Compare this section with Sec. 116, act June 30, 1864, as amended, infra. SEC. 28. That in estimating the gains, profits, and income of any person there shall be included Act Aug. 28, 1894. included in in come; interest on se United States profits from sales of real estate; What shall be all income derived from interest upon notes, bonds, and other securities, except such curities, except bonds of the United States the principal and bonds; interest of which are by the law of their issuance exempt from all federal taxation; profits realized within the year from sales of real estate purchased within two years previous to the close of the year for which income is estimated; interest received or accrued upon all notes, bonds, mortceived; gages, or other forms of indebtedness bearing interest, whether paid or not, if good and collectible, less the interest which has become due from said person, or which has been paid by him during the year; the amount of all premium on bonds, notes, interest re premium on bonds, etc.; sales of produce; or coupons; the amount of sales of live stock, sugar, cotton, wool, butter, cheese, pork, beef, mutton, or other meats, hay and grain, or other vegetable or other productions, being the growth or produce of the estate of such person, less the amount expended |