United States v. Bennett - 232 U.S. 299 (1914)
U.S. Supreme Court
United States v. Bennett, 232 U.S. 299 (1914)
United States v. Bennett
Argued January 6, 7, 1914
Decided February 24, 1914
232 U.S. 299
The rule of interpretation that, where there are two possible constructions of a statute, one of which will give rise to grave doubts of its constitutionality and the other avoids such question, the latter will be adopted is based on the existence of both conditions as to more than one construction and doubt and is not applicable where neither of those conditions exists.
The limitations of due process of law which prevent states from taxing property in another state do not apply to the United States, the admitted taxing power of which is coextensive with the limits of the United States and knows no restriction save as expressed in or arising from the Constitution itself.
The government of the United States as a nation, by its very nature, benefits the citizen and his property wherever found, and no imaginary barrier shuts that government off from exerting the powers which inherently belong to it by virtue of its sovereignty.
The tax imposed by § 37 of the Tariff Act of 1909 applies to the use of a foreign-built yacht owned by a citizen of the United States, although such yacht, for a period of more than one year prior to September 1, 1909, and to the levy of such tax, was used wholly outside of the limits and territorial jurisdiction of the United States.
The tax imposed by said act operated retrospectively, so as to be payable on September 1, 1909, in respect of the year then ended, and not only prospectively so as to become first due and payable on September 1, 1910.
The whole amount of the tax imposed by said act became due and payable on September 1, 1909, and not only such proportion thereof as the time during which the act was in force at that date bore to the whole year.
Congress has the power to levy a tax upon the use by a citizen of the United States of a yacht which is not actually, and since a time preceding the passage of the act was not at any time, used within the territorial jurisdiction of the United States, and which has its permanent situs in a foreign country.
Said act of Congress, imposing a tax upon the use of foreign-built yachts alone, provides a valid tax, and a valid classification for purposes of taxation, within the power to lay and collect taxes delegated to Congress by the Constitution of the United States.
The tax imposed by said act is not in conflict with the requirement of due process of law contained in the Fifth Amendment to the Constitution of the United States.
The United States is entitled to recover interest upon the tax imposed upon the use of foreign-built yacht under § 37 of the Tariff Act of August 5, 1909.
This Court answer the question certified in this case according to the facts stated in the certificate, and nothing in the replies should be so construed as to deprive the court below of the power to take such steps as it may deem necessary to avoid injustice by reason of any mistake of fact that may be corrected.
The facts, which involve the construction and constitutionality of § 37 of the Tariff Act of 1909 imposing a tax on foreign-built yachts and its application to a yacht owned by an American citizen but which had not been within the jurisdiction of the United States during any part of the period for which the tax as levied, are stated in the opinion.