Harlan F. Stone

“ In their British income tax returns, stockholders in British corporations are required to report as income, in addition to the amount of dividends actually received, amounts which reflect their respective proportions of the tax paid by the corporation on its own profits. ”

“ The other two companies declared the dividend in the amount distributed to stockholders and certified that it was 'free of tax.' The certificates of the latter did not purport to show any deduction of tax from a gross dividend, but did indicate the amount of the tax appropriate to the dividend and showed the same net return to stockholders as if the tax had been deducted from a computed gross dividend. ”

“ The expression of its will in legislation must be taken to conform to its own criteria unless the statute, by express language or necessary implication, makes the meaning of the phrase 'paid or accrued,' and hence the operation of the statute in which it occurs depend upon its characterization by the foreign statutes and by decisions under them. ”

“ The scheme of the British legislation is to impose on corporate earnings only one standard tax, at the source, and to avoid the 'double' taxation of the corporate income as it passes to the hands of its stockholders, except as they are subject to surtax which the corporation does not pay. The corporation pays the standard tax and against it the remedies for nonpayment run. It has been intimated that the shareholder may be held to payment of the tax in the event of the corporation's default, Hamilton v. ”