and operation, regardless of name. Disregarding the designation of the exaction, and viewing its substance and application, we hold that it is a penalty for the violation of state law, and as such beyond the limits of federal power.
'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.
'We think the suggestion has never been made- certainly never entertained by this Court- that the United States may impose cumulative penalties above and beyond those specified by state law for infractions of the State's criminal code by its own citizens. The affirmation of such a proposition would obliterate the distinction between the delegated powers of the federal government and those reserved to the states and to their citizens. The implications from a decision sustaining such an imposition would be startling. The concession of such of a power would open the door to unlimited regulation of matters of state concern by federal authority. The regulation of the conduct of its own citizens belongs to the state, not to the United States. The right to impose sanctions for violations of the State's laws inheres in the body of its citizens speaking through their representatives. * * *
'Reference was made in the argument to decisions of this Court holding that where the power to tax is conceded the motive for the exaction may not be questioned. These are without relevance to the present case. The point here is that the exaction is in no proper sense a tax but a penalty imposed in addition to any the state may decree for the violation of a state law. The cases cited dealt with taxes concededly within the realm of the federal power of taxation. They are not authority where, as in the present instance, under the guise of a taxing act the purpose is to usurp the police powers of the state.' (Emphasis supplied.)
No language that we could use would more clearly or more forcefully express the law of the land on this subject. In addition to its being the pronouncement of the Supreme Court of the land on the principle involved, and by which we are bound, we find ourselves in full accord with it, both in letter and in spirit. Today, the simplicity of our former way of life has largely disappeared. Our economic enterprises are myriad. While the desire to curb the underworld activities is a wholesome tribute to our fundamental aspirations, if the fundamental principles claimed by the federal government in this particular case were given the highest Judicial approval, future acts of Government in a field not so free from improper motives, would enable the Central Government to regulate our lives from the cradle to the grave. The remedy would be far worse than the disease.
The motion to dismiss is granted.
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