The opinion
Disney,
dissenting: I think that in the light of Helvering v. Gerhardt, 304 U. S. 405 , rehearing denied October 10, 1938, the question here presented requires our reexamination, and that, so reexamined, the answer is a denial of the immunity upheld by the majority opinion.
The burden of taxation passed on to the state or subdivision by reason of taxation of this employee is theoretical, not actual. The tax is not discriminatory, and overrefinement of plausible, but unsound theory, instead of a weighing of reality, is in my opinion the basis of claim of immunity. Collector v. Day, 11 Wall. 113 , adopted what appeared to be a well balanced reciprocal treatment of state and national government, but which neglected the sound distinctions between taxation by a state and by the United States, made by Chief Justice Marshall in McCulloch v. Maryland, 17 U. S. 315 , and reverted to and relied upon in Helvering v. Gerhardt, supra; and Collector v. Day, supra, has in turn been strained to apply to situations beyond its scope, until fact is made to subserve formula and, because of a certain symmetry in theory of reciprocal relations between nation and state, a class of immunity has been created which wars with the idea of equality of taxation inhering in the income tax law and the Constitution. Too much emphasis, I think, has been placed upon the idea of separate sovereignties and the fear of encroachment of one upon the other in the tax field. The dichotomy in the governance of the citizen of the United States does not cut so deeply. Nation and state should not be treated as wholly independent sovereigns. They are interdependent, and nowhere more so than in the tax realm. The employee of the state is a citizen of the United States, subject to its laws. Bealization of this interdependence and the pragmatic nature of income tax dictates that we should realize that there is in plain fact no burden upon the operation of state government because of nondiscriminatory Federal income tax upon those who administer it in the indirect manner of the employee who is petitioner here. Though the function performed by him be essentially governmental, I think the burden upon state is essentially chimerical, not factual.
Oppee agrees with this dissent.