The principle of graded taxation in the matter of incomes and succession taxes has been very generally adopted, not as yet in any direct property tax, except that a small amount of property, one hundred dollars or five hundred dollars, is usually exempt.

The principle of imposing taxation not for revenue, but for some ulterior or ethical purpose, such as the destruction of swollen fortunes, is liable to constitutional objection in this country, though the courts may not look behind the tax to the motive, unless the latter is expressed upon the face.  For this reason, the present corporation tax, on its surface, is imposed solely for the purpose of raising revenue, though in debate in Congress it was advocated mainly for the object of bringing large corporations under Federal examination and control.

The last matter relating to taxation, that of bounties, we have discussed in chapter VII also.  State aid bonds, or bonds of counties, cities, and towns, issued to encourage industries, raise a question far more complex than the simple bounty.  Such legislation has, however, practically ceased throughout the country, except in the form of exemption from taxation.  It has been recognized by a long line of decisions that it is constitutional to grant such aid to railroads, but it may be questioned in almost any other industry.  A mere exemption from taxation, especially for a certain number of years, rests on a stronger constitutional basis.  Many of the Southern States have recently passed laws exempting manufacturing corporations, etc., from taxation for a definite number of years, and such provisions are found in one or two State constitutions.  When they only rest upon a statute, however, they are always at least litigable at the suit of any tax-payer.  So, bonds issued by the city of Boston under a statute expressly authorizing them to enable land-owners to rebuild after the great fire, were held to be void.  A Federal loan was proposed to raise money to lend to the inhabitants of San Francisco to rebuild after the earthquake, but failed of enactment.  It will be remembered that the States have very generally no power to engage in internal improvements (see above). A fortiori, therefore, they can hardly loan money or credit to private interests be they never so much for the general benefit.  The difficulty of testing all such laws has been adverted to, at least in the case of taxation.  For that purpose Massachusetts has a wise law providing machinery by which such matters may be contested upon the action of any ten tax-payers.

There are three great questions before us in the immediate future—­the negro, local or self government, and taxation, which last is the chief problem of city and town government.

The world has never before tried the experiment of municipal government, where those who have the local vote do not generally pay the local taxes.

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