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Date: Tue, 27 May 1997 07:28:29 -0700
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From: Paul Andrew Mitchell [address in tool bar]
Subject: L&J: SLF: good review of 2nd Amendment court cases


>Date: Tue, 27 May 1997 07:17:03 -0700
>To: (Recipient list suppressed)
>From: Paul Andrew Mitchell [address in tool bar]
>Subject: SLS: U.S. v. Constantine, 296 U.S. 287, 294 (1935)
>
>This is an  excerpt  from a  document  entitled "Second Amendment
>Related Court Cases" at http://www.nysrpa.org/e&tcourt.htm:
>
>[begin excerpt]
>
>     This issue  was again  resolved adverse to the government in
>United States  v. Constantine,  296 U.S.  287, 294, 56 S.Ct. 223,  <---
>226, 80  L.Ed. 233  (1935). A  statute  provided  for  a  federal
>assessment for  one who  violated a  state liquor  law. The Court
>held that  it would  be invalid  "if, in  fact, its purpose is to
>punish rather  than to  tax." Id. No federal jurisdiction existed
>to enforce  alcohol Prohibition, because the Eighteenth Amendment
>had been  repealed. Id. Similarly, no federal jurisdiction exists
>to ban mere possession of machine guns, and the NFA provisions at
>issue are  not supported  by the  tax power  to the  extent  they
>enforce a  prohibition rather than taxation. As Constantine held,
>"a penalty cannot be converted into a tax by so naming it ...[W]e
>hold that  it is a penalty for the violation of State law, and as
>such  beyond   the  limits  of  federal  power."  Id.  The  Court
>explained: The condition of the imposition is the commission of a
>crime. This,  together with  the amount  of  the  tax,  is  again
>significant of  penal and  prohibitory  intent  rather  than  the
>gathering of  revenue. Where,  in  addition  to  the  normal  and
>ordinary tax  fixed by  law, an additional sum is to be collected
>by reason  of conduct  of the  taxpayer violative of the law, and
>this additional  sum is grossly disproportionate to the amount of
>the normal  tax, the  conclusion must  be that  the purpose is to
>impose a  penalty as  a  deterrent  and  punishment  of  unlawful
>conduct. We  conclude that the indicia which the section exhibits
>of an intent to prohibit and to punish violations of State law as
>such are  too strong to be disregarded, remove all semblance of a
>revenue act  and stamp  the sum  it exacts  as a penalty. In this
>view the  statute is  a  clear  invasion  of  the  police  power,
>inherent in  the States, reserved from the grant of powers to the
>federal government  by the  Constitution. Id. at 295-96, 56 S.Ct.
>at 227.  It is  well established that Congress may tax both legal
>and illegal  activities. Marchetti v. United States, 390 U.S. 39,
>44, 88 S.Ct. 697, 700, 19 L.Ed.2d 889 (1968).4 Gambling and other
>acts which  may be  illegal under  state law  may be  taxed,  and
>registration may  be required  to assist in collection of the tax
>as long  as registration  information  is  not  shared  with  the
>police, since  such sharing  would violate  the privilege against
>self-incrimination. Id.  Registration  is  among  the  "ancillary
>provisions  calculated   to  assure   their  [i.e.,   the  taxes]
>collection."5 Id.  at 42,  88 S.Ct.  at 699. In contrast with the
>federal taxation  and registration  of conduct made illegal under
>state law, which the courts have upheld, the case at bar involves
>federal  taxation   and  registration   requirements  which   the
>government interprets  as repealed  by a  federal statute  making
>post-1986  machine   guns  illegal.   In  short,  the  government
>registers gamblers  and accepts their tax payments; it refuses to
>accept registrations  and tax  payments for the making of machine
>guns.
>
>     The prosecution also asserts that "machine guns may still be
>manufactured,   and    therefore   taxed,    under   18    U.S.C.
>s922(o)(2)(A)."  Response   at  6.   Yet,  the   government   has
>successfully argued  that that  provision allows manufacture only
>for official government use. Farmer v. Higgins, 907 F.2d at 1042-
>44. Manufacture  for government  use is  exempt from  any tax. 26
>U.S.C. ss5852,  5953. Also,  this argument  fails to  address the
>fact that  the United  States refuses  to register  any post-1986
>machine  guns,   thereby  severing   any  tax   nexus  for   this
>registration requirement, with which compliance is impossible. In
>its motion  to reconsider,  the prosecution  reiterates that  the
>government can tax an item or activity which is illegal. Yet, the
>very framing  of this  proposition presupposes  that the activity
>can and  will be  taxed. By  contrast, in  the case  at bar,  the
>government  interprets   18  U.S.C.   s922(o)  to   prevent   the
>registration and  taxation of  post-1986 machine  guns  made  for
>private purposes under the National Firearms Act, 26 U.S.C. s5801
>et seq.  The prosecution  relies on  Marchetti v.  United States,
>supra, 390 U.S. at 44, 88 S.Ct. at 700, which held that reporting
>requirements for taxation of illegal gambling may not violate the
>privilege against self-incrimination. Yet, implicit in Marchetti,
>is the  rationale that registration provisions are Constitutional
>if and only if they assist in collection of revenue. As Marchetti
>states:  The  taxes  are  supplemented  by  ancillary  provisions
>calculated to  assure  their  collection.  In  particular,  s4412
>requires those  liable for  the occupational tax to register each
>year with  the director  of the  local internal revenue district.
>Id. at  42, 88  S.Ct. at  699. Illegal  gamblers are  allowed  to
>register and  pay the  tax. Alleged  makers of machine guns after
>1986 are not. The prosecution also relies on dictum in a footnote
>in Minor  v. United States, 396 U.S. 87, 90 S.Ct. 284, 24 L.Ed.2d
>283 (1969),  which held  that a  reporting  requirement  by  drug
>buyers does  not violate  a drug seller's privilege against self-
>incrimination. The  prosecution, relying  on a  statement in  the
>dissenting opinion  (396 U.S.  at 100,  90 S.Ct.  at 290), claims
>that it  was impossible to pay the drug tax in that case. The Act
>in question  required  dealers  to  register  with  the  Internal
>Revenue Service  and pay a special occupational tax, and required
>producers or  importers to  purchase stamps and affix them to the
>package. Registered  dealers could secure order forms to transfer
>drugs. Id. at 94, 90 S.Ct. at 287. While the Court focused on the
>self-incrimination issue,  it noted that "there were some 400,000
>registered dealers  under the  Harrison Narcotics Act in 1967 and
>that registered  dealers can  readily get  order forms  issued in
>blank." Id.  at 97,  90 S.Ct.  at 289.  As the Court noted, a tax
>measure is valid even though it may deter an activity, revenue is
>negligible, or the activity may be illegal. 396 U.S. at 98 n. 13,
>90 S.Ct.  at 289  n. 13.6 Indeed, since being passed in 1934, the
>National Firearms  Act has imposed occupational taxes, making and
>transfer taxes  of $200  per firearm,  and stringent registration
>requirements. Yet,  these taxation requirements did not amount to
>a prohibition,  and registration  retained a  tax nexus.  In  any
>event, the  interpretation of  the Constitutional  basis  of  the
>specific statute  in this case is governed by Sonzinsky v. United
>States, supra, 300 U.S. 506, 57 S.Ct. 554 and its progeny, not by
>dictum in  a footnote  in an  unrelated narcotics case. Sonzinsky
>held that  "the mere  registration provisions  ... are  obviously
>supportable as  in aid  of revenue purpose." Id. at 513, 57 S.Ct.
>at 555.  Haynes v. United States, supra, 390 U.S. at 87, 88 S.Ct.
>at 725, repeated that the National Firearms Act is a tax measure,
>and that registration is "calculated to assure [tax] collection."
>Id. at  88-89, 88 S.Ct. at 725-26. The Act was described as a tax
>measure again in United States v. Freed, 401 U.S. 601, 602-03, 91
>S.Ct. 1112,  1114-15, 28  L.Ed.2d 356 (1971). The enactment of 18
>U.S.C. s922(o)  in 1986  removed the Constitutional legitimacy of
>registration as  an aid  to tax  collection. This  is because the
>government  interprets   and   enforces   s922(o)   to   disallow
>registration, and  refuses to collect the tax. Farmer v. Higgins,
>907 F.2d 1041, 1042-44 (11th Cir.1990), cert. denied, ---U.S.---,
>111 S.Ct. 753, 112 L.Ed.2d 773 (1991). Thus, s922(o) undercut the
>Constitutional basis  of registration  which had  been  the  rule
>since Sonzinsky.  Finally, the  prosecution quotes  an  enactment
>passed in  1968 that the provisions of Title I of the Gun Control
>Act shall  not modify  or  affect  the  National  Firearms  Act.7
>However, the  1968 Congress  cannot bind  the Congress  of  1986,
>which decided  to ban  transfer and  possession of  machine guns.
>P.L.  99-308,   100  Stat.   453  (May  19,  1986).8  Further,  a
>congressional declaration in 1968 does not solve a Constitutional
>problem which  arose in  1986. The  ban enacted  in 1986, and the
>government's refusal  to accept  registrations and  tax payments,
>simply left  the registration requirements with no Constitutional
>basis. It  is the  duty of  the judiciary  to declare  such  laws
>unConstitutional. Marbury  v. Madison,  1 Cranch.  137, 176-77, 2
>L.Ed. 60  (1803). In  sum, since  enactment of 18 U.S.C. s922(o),
>the Secretary  has refused  to accept any tax payments to make or
>transfer a  machine gun  made after  May 19, 1986, to approve any
>such making  or transfer, or to register any such machine gun. As
>applied to  machine guns  made and  possessed after May 19, 1986,
>the registration  and other requirements of the National Firearms
>Act, Chapter 53 of the Internal Revenue Code, no longer serve any
>revenue   purpose,    and   are   impliedly   repealed   or   are
>unConstitutional. Accordingly,  Counts 1(a)  and (b), 2, and 3 of
>the superseding indictment are DISMISSED.
>
>[end excerpt]
>
>                             #  #  #
>
>

========================================================================
Paul Andrew, Mitchell, B.A., M.S.    : Counselor at Law, federal witness
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