Joseph P. Bradley

“ The corporation, as the debtor of its bondholders, holding money in its hands for their use, namely, the interest to be paid, is merely required to pay to the commonwealth out of this fund the proper tax due on the security. The tax is on the bondholder, not on the corporation. This plan is adopted as a matter of convenience, and as a secure method of collecting the tax. That is all. It injures no party. It certainly does not infringe the constitution of the United States by making one party pay the debts and support the just burdens of another party, as is implied in the objection. ”

“ So long as the interest is paid the security has to him full productive value; when it is not paid, he pays no tax. But, be this as it may, the law does not make any discrimination in this regard which the state is not competent to make. All corporate securities are subject to the same regulation. The provision in the fourteenth amendment, that no state shall deny to any person within its jurisdiction the equal protection of the laws, was not intended to prevent a state from adjusting its system of taxation in all proper and reasonable ways. ”

“ By the law of Pennsylvania, all moneyed securities are subject to an annual state tax of three mills on the dollar of their actual value, except bonds and other securities issued by corporations, which are taxed at three mills on the dollar of the nominal or par value. If the treasurer of a corporation fails to make return of its loans, as required by law, the auditor general makes out and fie § an account against the company, charging it with the tax supposed to be due. ”