924 HARVARD LAW REVIEW Earlier in the opinion the Chief Justice reviewed the cases forbidding either the states or the nation to tax the salaries of the officers of the other, and plainly regarded the want of national power to tax in- come from state securities as the complement of an imdoubted absence of state power to tax income from federal securities. Though this immunity of federal securities from state taxation has been regarded as inherent in the federal system created by the Constitution, Congress has taken the precaution specifically to declare that United States bonds shall be exempt from state taxa- tion. The Act of February 25, ii462,^° specifies that "all stocks, bonds, and other securities of the United States held by indivi- duals, corporations, or associations within the United States, shall be exempt from taxation by or under State authority." The Act of July 14, 1870,^^ mentions "the interest thereon" as well as the bonds. The Act of June 28, 1902,^^ is content with declaring ex- emption "from taxation in any form by or under State, municipal, or local authority;" but the recent acts under which Liberty Bonds have been issued require the states to refrain from taxmg both "principal and interest." ^ Thus the only constitutional question which could now be brought before the court is the existence vel non of congressional power to decree the exemption of principal and interest of federal securities from state taxation. No one can doubt that this power will be sustained, even though the court might now be persuaded that the exemption is a bounty rather than the fending off of a burden. If Congress deems that the exigencies of the na- tional government require that national obligations be wholly free from state taxation in any form whatsoever, its judgment will never be overruled by the Supreme Court. Congress has been content to be silent with respect to state taxa- tion of income from corporate dividends when the corporate income
- ° 12 Stat, at L. chap. z2t, § 2, p- 346, 8 Fed. Stat. Ann. 2 ed., 407.
- i 16 Stat, at L. 272. "... all of which several classes of bonds and the interest
thereon shall be exempt from the payment of all taxes or duties of the United States, as well as from taxation in any form by or under State, municipal, or local authority." ^'^ 32 Stat, at L. 484. This was the statute authorizing the issue of the so-called Panama Canal bonds. ^ Fed. Stat. Ann. — 1918 Supp. 673: "... both principal and interest shall be exempt from all taxes or duties of the United States as well as from taxation in any form by or imder State, municipal, or local authority." (Act of March 3, 1917.) Similar language is used in the Act of September 24, 191 7, Fed. Stat. Ann. — 1918 Supp. 684.
