satisfied by a law prescribing a tax uniform wherever imposed, or whether it exacts imposition everywhere in order to warrant collection anywhere. Lately, the Supreme Court was urged to declare the federal inheritance tax invalid on the ground that Congress had not provided for its collection in the District of Columbia, but the Court, "without attempting to de"termine whether the necessary construction of the "statute would require the inclusion of the District "of Columbia within its terms, aside from any special "provision bearing on the question," found that a section of the act covered the District by necessary implication.1 Note that the Court did not contemplate the possibility of a deliberate exemption, but suggested the very different question whether an indirect tax law must be construed so as to embrace all territory, and only refused to discuss it because a specific provision of the act sufficiently designated the District of Columbia. I am satisfied that should the Court deal with a tax law purporting to exempt territory it must either ignore the incidental purpose of Congress by declaring the exemption to be ineffective, or defeat the main purpose by annulling the law because of its lack of uniformity; "because," says Chief Justice Marshall, "it is admitted "that the Constitution not only allows, but enjoins, "the government to extend the ordinary revenue sys"tem to this District "2- that is, the District of Columbia; and this injunction applies as well to all United States territory.

1 Knowlton v. Moore, 178 U. S. 41, 106.

2 Loughborough v. Blake, 5 Wheaton 317, 325.

Having found that the failure to provide for the collection of certain current federal taxes does not vitiate the Porto Rico system itself, or react destructively upon federal tax laws, we will examine its pretensions as a law framed for the purpose of raising local revenue.

The United States having the power to acquire and govern territory, Congress must be competent to provide means for administering it, and to this end it may impose local taxes, either directly or through local authorities acting under its supervision. The result is that political districts beyond the States are, like the States, subject to a double system of taxation, federal and local, the difference being that in the latter case the separate taxes are imposed by two governments, Federal and State, while in the former they are imposed by the Federal Government acting in two capacities.

In imposing these local taxes, whether directly, as in Alaska, or through the agency of a local government, as in New Mexico, Congress is free from certain constitutional restraints which affect it in levying federal taxes.1 Direct taxes are, as we have seen, practically excluded from the federal budget, but they appear in the budgets of outlying districts, where the rule of apportionment does not apply: Lands in the city of Washington and in New Mexico are taxed for local purposes on independent lines. Excises imposed for the common defense and general welfare of the United States must be uniform, but they may vary widely when levied for local poses: A wholesale liquor dealer pays a license tax

1 See Gibbons v. District of Columbia, 116 U. S. 404.

pur

of $100 in New Mexico, and $250 in the city of Washington. But a tax proposed for territorial purposes may suggest constitutional restrictions which cannot be dismissed by calling the tax a local one, especially when it is to be levied upon commerce beginning or ending beyond the boundaries of the Territory; and some of the duties of the Porto Rico Act fall within this category.

The duties of the general tariff law which are levied on foreign imports into Porto Rico, and applied to local uses, are not objectionable: For here the act really extends the general law to the island, and, at the same time, appropriates specifically the revenue collected therein.

The duties collected in Porto Rico on imports from our mainland are local in purpose, and they are levied by Congress acting as a local legislature; but because their imposition does, in fact, create within the United States a peculiar customs district in respect of internal commerce, it contravenes a purpose of the uniformity clause of the Constitution.

The duties collected on our mainland on imports from Porto Rico are not local taxes. They are not imposed or collected in the island: Nor could Congress authorize a local government to impose or collect them here. Their appropriation to the use of Porto Rico does not make them local taxes. The imposition and the appropriation of taxes are distinct acts, however closely they may be joined in a single statute, and the quality of a federal tax is as plainly impressed upon these duties as though they 1 Compiled Laws, 1897, Sec. 4122. 22 Supp. R. S., p. 115.

were collected under a general tariff law and their proceeds granted afterward to Porto Rico by an appropriation act. Being federal duties they are invalid because not "uniform throughout the United States." Being invalid, the Porto Rico tax scheme fails to legitimate the dearest purpose of its promotersthe declaration of a federal power to prevent outlying possessions from competing in what is called our "home market."

The duty of five cents per pound collected in Porto Rico upon all importations of coffee is a local tax, evidently imposed for protection rather than revenue. This tariff tax of local benefit and application is, I believe, the first in our history; certainly none has been scrutinized by our courts. The Constitution expressly provides for tariffs of federal benefit only; for while a State may be specially permitted to lay duties on imports, it must pay the net proceeds into the federal treasury.1 The imposition of this special tax differentiates the ports of the island from those of our mainland, and I have a strong impression that all customs taxes, wherever, or for whatever purpose levied, must be judged by the federal rule of uniformity, because they affect, necessarily, the commerce of the republic which, excepting trade carried on within the several States and Territories, is made by the Constitution a matter of exclusive federal concern.

There is bitter opposition to applying to the Philippines the constitutional rule of uniform tariff taxes. It is asserted that Congress cannot impose uniform duties on foreign imports that will be equally 1 See Constitution, Art. I, Sec. 10.

fair to the islands and to the mainland; but this suggests merely a phase of the persistent tariff controversy. Doubtless the new phase presents new difficulties, yet recalling that one tariff act drove South Carolina to the edge of rebellion, and that another led Louisiana to the Treasury for sugar bounties, we need not apprehend more extreme results from extending our revenue system to the Philippines.

Free trade between the Philippines and Porto Rico and the mainland may affect important agricultural interests here. Should Cuba be annexed, notwithstanding our promise, the disturbance will be more serious. If manufactures shall be established in the islands the wave of disturbance may cover a wider area. But these incidents of annexation cannot influence the interpretation of the Constitution.

The Commercial Unity of the United States

In anticipation of the possible range of this great question of commerce with annexed territory let us inquire whether protection of the so-called "home "market," being unattainable through invidious tariffs, may be secured by direct prohibition, by embargo: A method harsher in sound, yet not more potent than taxation; needlessly brutal, perhaps, in present circumstances, yet likely to find apologists should we annex land crowded with workmen eager to sell their cheap wares in our great market.

The

answer depends on the extent of the federal power to regulate commerce" conferred by the Constitution upon Congress in respect of commerce "with foreign