Ft Smith Lumber Co v. State of Arkansas Arbuckle, 394
Decision Date | 01 March 1920 |
Docket Number | No. 394,394 |
Citation | 64 L.Ed. 396,251 U.S. 532,40 S.Ct. 304 |
Parties | FT. SMITH LUMBER CO. v. STATE OF ARKANSAS ex rel. ARBUCKLE, Atty. Gen |
Court | U.S. Supreme Court |
Messrs. Joseph M. Hill and Henry L. Fitzhugh, both of Ft. Smith, Ark., for plaintiff in error.
Messrs. John D. Arbuckle and George Vaughan, both of Little Rock, Ark., for defendant in error.
This is a suit by the State of Arkansas against the plaintiff in error, a corporation of the State, to recover back taxes alleged to be due upon a proper valuation of its capital stock. The corporation owned stock in two other corporations of the State each of which paid full taxes and it contended that it was entitled to omit the value of such stock from the valuation of its own. This omission is the matter in dispute. The corporation defendso n the ground that individuals are not taxed for such stock or subject to suit for back taxes, and that the taxation is double, setting up the Fourteenth Amendment. The case was heard on demurrer to the answer and agreed facts, and the statute levying the tax was sustained by the Supreme Court of the State.
The objection to the taxation as double may be laid on one side. That is a matter of State law alone. The Fourteenth Amendment no more forbids double taxation that it does doubling the amount of a tax; short of confiscation or proceedings unconstitutional on other grounds. Davidson v. New Orleans, 96 U. S. 97, 106, 24 L. Ed. 616; Tennessee v. Whitworth, 117 U. S. 129, 136, 137, 6 Sup. Ct. 645, 29 L. Ed. 830; St. Louis Southwestern Ry. Co. v. Arkansas, 235 U. S. 350, 367, 368, 35 Sup. Ct. 99, 59 L. Ed. 265. We are of opinion that it also is within the power of a State, so far as the Constitution of the United States is concernied, to tax its own corporations in respect of the stock held by them in other domestic corporations, although unincorporated stockholders are exempt. A State may have a policy in taxation. Quong Wing v. Kirkendall, 223 U. S. 59, 63, 32 Sup. Ct. 192, 56 L. Ed. 350. If the State of Arkansas wished to discourage but not to forbid the holding of stock in one corporation by another and sought to attain the result by this tax, or if it simply saw fit to make corporations pay for the privilege, there would be nothing in the Constitution to hinder. A discrimination between corporations and individuals with regard to a tax like this cannot be pronounced arbitrary, although we may not...
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