Charles Evans Hughes

“ It is not urged that the legislation of Congress relating to national banks, either expressly or by implication, withdraws from the reach of the taxing power of the state the credits belonging to depositors, whether or not interest-bearing. 'No one contends,' says the plaintiff in error, that a state 'has not the right to include in its taxation of a person's property the amount which he may have on deposit in the savings department of a national bank.' It must also be recognized that in exercising its authority to tax property within its jurisdiction, the state is not limited to one method. ”

“ But it is apparent that, whatever other objections may lie, the tax complained of is not laid upon the national bank itself, its property or franchises. It is imposed upon the depositors; they alone are required to pay it. If they fail to make returns, as provided by the statute, they are subject to penalty; and both tax and penalty are recoverable by suit against them in the name of the state. If they escape the tax, it is because of the bank's stipulation. If the bank becomes liable, it is by virtue of its agreement, and not otherwise. ”

“ National banks did not pay, and could not be compelled to pay, a franchise tax, or other tax upon their deposits, and their depositors having credits bearing interest at a rate exceeding 2 per cent per annum were required by the statute in question to pay upon such credits a tax of 7/20 of 1 per cent semiannually. Or, if any national bank desired to do so, it could agree to pay an amount computed at the same rate upon the average amount of deposits of the described class, and thus save its depositors both from the tax and the inconvenience of making returns. ”