of the army. These laws, with occasional modifications, were in force in that empire during the reigns of many emperors, the rate of taxation averaging about five per centum of the property subject to the tax above a certain value. The law, however, in any of its successive forms, did not exact the tax from the nearest relatives on the father's side. It was very comprehensive, produced a large revenue and was styled the Vicessima hereditatum et legitorum.

Death duties have also been collected for centuries by the later European governments. They were introduced into England as a complete system in 1780 where they have been enlarged and changed from time to time. They are now a source of great revenue in nearly all European states, notably in Germany, Austria, France, Switzerland and its cantons, Holland, Russia, Italy, Spain, Portugal, Greece, Denmark and Sweden, as well as in the Australian colonies, Canada and some of the South American countries.

The English legacy act of 1780 is said to have been introduced and championed by Lord North, whose attention was first called to the desirability and justice of such a tax by Adam Smith's The Wealth of Nations. Prior to the Yenactment of this law, however, there appears to have been in existence in that country what was substantially a succession tax under the old Feudal system. Under that system the Feudal lords compelled the heir or successor to property to pay them a certain sum or perform a certain service before he could be invested with the estates of his ancestor. Under the act of 1780 only legacies of personal property were taxed, but in 1853 Mr. Gladstone championed a measure, which was adopted, taxing successions to real property also. In practically this form the English succession or inheritance duty act remains at present and it is said to yield an annual income to the state of something like $40,000,000.

Inheritance taxes were not known in this country until July 5, 1797, when Congress imposed a graduated legacy tax to be paid by stamps placed upon the receipt or other discharge for or on account of any legacy or distributive share of property. This law was in force until June 30, 1802, but for obvious reasons produced only a small revenue. The next Federal law of this character was the act of July 1, 1862, laying a tax upon the transmission of personal property by will or by intestate law. In 1864 this law was amended and reënacted and on July 13, 1866, a further amendment was adopted, extending its provisions to successions to real property. The whole law was repealed to take effect October 1, 1870, but during its continuance it produced many a million of much needed war-revenue. On August 27, 1894, the famous income tax law was passed, which also embraced an inheritance tax feature. This law was most viciously and vigorously attacked, and in the celebrated case of Pollock versus the Farmer's Loan and Trust Company (157 U. S., 429), the Supreme Court of the United States, on a re-hearing, declared the income tax unconstitutional, and intimated intimated very strongly, at least, that as all the provisions of the act were so bound together as to be inseparable the inheritance tax feature could not be enforced. Hence no real attempt was made to collect the inheritance tax and it remained a dead letter until the law expired by its own terms in 1900. Then in the Spanish war-revenue act of June 13, 1898, inheritance tax was imposed upon the transmission of personal property, this law remaining in force until July 1, 1902, when it was repealed.

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Pennsylvania was the first of the United Commonwealths to enact a law of this character. That was in 1826. Since then a considerable number of the States have enacted such laws in the most of which they are still being enforced.

A full understanding of the theory

upon which inheritance taxes are based, renders it more easy to comprehend their justness and equity. It is the usual thought among laymen that the heirs of a deceased person, and particularly the heirs of the body, have a natural, inherent right to the property accumulated by that deceased. Or, to state it in another way, that each person who owns property not only owns the property itself, but has a natural, inherent right to control its disposition after death. This erroneous idea has caused much of the opposition to death duties, for having this idea it is hard for one to conceive the justness of taxing property when it changes ownership by reason of death. But it is a proposition fully recognized in law that in a state of nature property rights last just so long as possession continues and no longer, and that when possession ceases, either voluntarily, by force of arms or by death, all rights of ownership cease. In a state of nature there is no such thing as heirship or as the transmission of any property right from the dead to the living. This is a proposition recognized by the great majority of the earlier writers including Christian, Puffendorff and Grotius, although some demur to the position taken. Nearly all later writers seem to agree with the early majority, Mr. Justice Sharswood, however, an eminent authority, claiming that heirship in children is founded on natural law. Blackstone in his Commentaries sets out very clearly the recognized law on the subject and I quote his language:

"Naturally speaking, the instant a man ceases to be he ceases to have any dominion; else if he had a right to dispose of his acquisitions one moment beyond his life he would also have a right to direct their disposal for a million of ages after him; which would be highly absurd and inconvenient. All property must, therefore, cease upon death, considering men as absolute individuals and unconnected with civilized society, for then, by the principles before

established, the next immediate occupant would acqire a right in all that the deceased possessed. But as, under civilized governments, which are calculated for the peace of mankind, such a constitution would be productive of endless disturbances, the universal law of almost every nation (which is a kind of secondary law of nature) has either given the dying person a power of continuing his property by disposing of his possessions by will, or in case he neglects to dispose of it, or is not permitted to make any disposition at all, the municipal law of the country then steps in and declares who shall be the successor, representative or heir of the deceased; that is, who alone shall have a right to enter upon this vacant possession in order to avoid that confusion which its again becoming common would occasion. And further, in case no testament be permitted by the law, or none be made, and no heir can be found so qualified as the law requires, still to prevent the robust title of occupancy from again taking place, the doctrine of escheats is adopted in almost every country; whereby the sovereign of the state and those who claim under his authority are the ultimate heirs and succeed to those inheritances to which no other title can be formed.

"The right of inheritance or descent to the children and relatives of the deceased seems to have been allowed much earlier than the right of devising by testament. We are apt to conceive at first view that it has nature on its side; yet we often mistake for nature what we find established by long and inveterate custom. It is certainly a wise and effectual, but clearly a political, establishment; since the permanent right of property, vested in the ancestor himself, was no natural, but a civil right. Wills, therefore, and testaments, rights of inheritance and successions, are all of them creatures of the civil or municipal laws and accordingly are in all respects regulated by them.

The theory upon which inheritance

tax laws are based is founded upon two legal propositions: First, that the tax is not one upon property, but upon the right or privilege in the one possessed thereof to control its disposition after his death, or the right or privilege given to others to inherit or take from the one who dies so possessed; and second, that the right to take property by devise or descent is a creature of the law and not a natural right-a privilege and therefore the authority which confers that privilege may impose conditions upon its exercise. Not being a tax imposed on property as such, but upon an intangible thingthe abstract right to dispose of or to inherit property-the tax has never been regarded by the courts as a direct tax. On the contrary in many decisions by the Supreme Court of the United States the tax is defined as an impost duty or excise, levied by the government, upon the privilege secured by law to devisees, legatees, grantees, heirs and personal representatives, of taking, holding and enjoying all property, real and personal, or any interest therein, passing by will, by intestate law, or by any grant or gift made during life and intended to take effect at or after the death of the grantor. So a succession to or an inheritance of property may be taxed as a privilege, notwithstanding the property of the estate is taxed, and there is by reason thereof no double taxation.

Now since the right to take property by will or by intestate law is but a mere privilege created by the municipal law which may be changed, modified or repealed in the discretion of the State, and is not a natural right, it appears just and equitable that, in consideration of this privilege given by the state, the beneficiaries should contribute to the State a certain percentage of the value of the property subject to the exercise of the privilege. This is particularly true as to the privilege thus extended by law to collateral kindred, remote relatives, strangers in blood and corporations, although the inheritance of property by

lineal descendants is a privilege and not a right just the same as the inheritance of property by those of more remote relationship or of none. In other words, when the State relinquishes its right to again take to itself upon the death of the occupant or owner the property possessed by him during his life-time, the individual in whose favor the State's natural right of succession is waived, ought not to complain when called upon to pay a small amount for the valuable privilege thus granted to him.

Starting with the well-established basic proposition that the transmission or receipt of property by death is a privilege originating in the municipal law and governed by it, it follows that the State, as the sovereign, has the constitutional power to amend, modify, extend or wholly repeal such law. This premise and deduction are recognized by all law writers and have been sustained by many hundreds of decisions of courts in this and other countries. From this viewpoint an inheritance tax simply modifies the laws of descent and distribution; for if the tax be five per centum of the value of the property inherited the effect is to give the heirs or legatees of an estate ninety-five per centum of the property granted to each, and to escheat to the State the five per centum. If the State has the right and power to relinquish all its rights of succession to certain persons, no one can logically contend that it has not the equal right to relinquish only half its rights of succession or ninety-five per centum of such rights. So that while that which the legatee or beneficiary pays to the State under an inheritance duty act is called a tax and is treated legally as such, it is, fundamentally considered, simply a partial escheat to the State of the property of a deceased.

This legal situation has always been recognized in this country. In an early Virginia case (Eyre vs. Jacob, 14 Grat., 427), which has been quoted with approval in decisions of the Supreme Court of the United States, Judge Lee said: