Art. XVI says that he had previously raised these objections to "collection at the source."

"1. That it threw the burden of taxation on the stockholder who paid the interest rather than on the bondholder who received the income, because of the covenant in a large majority of bonds which forbids the retention of any tax the company might be called upon to withhold.

"2. It made the stockholder pay a tax for non-taxable persons, because the tax levy was on incomes in excess of a certain amount, whereas the machinery of collection exacted retention of a tax on all incomes.

"3. It exacted a tax on small incomes where there was no guaranty clause, and left the recipient though non-taxable - seemingly without recourse."

After referring to the effort of the Senate Caucus to meet the situation by certain amendments, the writer says, "What the Wall Street Journal suggested was that the paying company be authorized by Congress to require disclosure of the identity of the owner of the coupon, either by indorsement or otherwise, before payment. Then anyone who accepted an unindorsed or unidentified coupon would do so at his peril and could not claim exemption."

The writer says further that the imposition of a tax on every bondholder is accomplished through these amendments:

First, by changing the levy from a tax on income "over and above $4,000," to a tax on income “except as hereinafter provided." (See A, subdivision 1.)

Second, by the amendment to the rules for computing net income. "There shall be allowed as deductions

"Eight, the amount of income, the tax upon which has been paid or withheld for payment at the source," etc. (See B.)

"Provided, further, that the amount of the normal tax hereinbefore imposed shall be deducted and withheld from fixed and determinable annual gains, etc.'

"Inasmuch as the only requirement in the bill for deduction at the source on incomes of less than $3,000 is in connection with income from bond or similar investments, it seems clear from the foregoing quotations that it is the intention of the framers of the bill to tax income derived from bonds no matter how small it may be. It seems a case of deliberate penalization of corporate investment."

There is such a lack of practical information as to procedure and rulings and decisions that few suggestions can be given relative to com

pliance with the above statutory provisions as to collection at the source.

It is to be noted, however, that the surtax is to be collected direct from persons with incomes in excess of $20,000, and that collection at the source applies only to incomes between $3,000 or $4,000 and $20,000.

That those who fail to make the return, withhold the tax and pay it, must themselves pay it.

That, in the case of payment of dividends by corporations, no deduction or return of the name of the person to whom paid is required.

That the persons, firms, etc., undertaking the collection of foreign payments of interest and dividends, etc., must make application for license without any notice from the Commissioner of Internal Revenue.

That no tax is to be withheld at the source prior to November 1, 1913.

See further as to collection at source, pp. 83 et seq.

PENALTIES IN CASE OF REFUSAL OR NEG-
LECT TO MAKE RETURN AND IN CASE
OF FRAUDULENT RETURN.

F. That if any person, corporation, jointstock company, association, or insurance

company liable to make the return or pay the tax aforesaid shall refuse or neglect to make a return at the time or times herein

before specified in each year, such person shall be liable to a penalty of not less than $20 nor more than $1,000. Any person or any officer of any corporation required by law to make, render, sign, or verify any return who makes any false or fraudulent return or statement with intent to defeat or evade the assessment required by this section to be made shall be guilty of a misdemeanor, and shall be fined not exceeding $2,000 or be imprisoned not exceeding one year, or both, at the discretion of the court, with the costs of prosecution.

This sub-section seems to be largely new.

Ex post facto laws, as applied to criminal offences, are constitutionally invalid, but they do not apply to laws intended to protect vested rights of property. Retrospective laws strictly apply only to civil rights and remedies, and are invalid only when they infringe upon rights vested under existing laws. Every law

that is to have an operation before the making thereof, as to commence at an antecedent time, or to save time from the statute of limitations, or to excuse acts which were unlawful, and before committed, and the like, is retrospective. Calder v. Bull, 3 Dallas, 386. See also Ex parte Medley, 134 U. S. 160; United States v. 64 Barrels of Spirits, 3 Cliff. 308; Kille v. Reading Iron Works, 134 Penn. St. 225.

So a contract right under a statute is a vested right which cannot be impaired by a repeal of the statute. Steamship Co. v. Joliffe, 2 Wall. 450; Koshkonong v. Burton, 104 U. S. 668.

The established rule appears to be that a forfeiture takes place when the offence is committed, although in the early case announcing this rule Judge Story held, in a dissenting opinion, that a forfeiture attached to a thing conveys no property therein to the Government until seizure made or suit brought. United States v. 1960 Bags of Coffee, 8 Cranch, 398. See United States v. The Mars, 8 Cranch, 417.

It is competent for Congress to impose taxes retrospectively. Stockdale v. Ins. Cos., 20 Wall. 323; Locke v. New Orleans, 4 Wall. 172.

A statute which, after annual settlements, authorized county auditors in Ohio to extend back, for four years, inquiries as to property