283 U.S. 183 (1931), 358, Interstate Transit, Inc. v. Lindsey

Docket Nº:No. 358
Citation:283 U.S. 183, 51 S.Ct. 380, 75 L.Ed. 953
Party Name:Interstate Transit, Inc. v. Lindsey
Case Date:April 13, 1931
Court:United States Supreme Court
 
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Page 183

283 U.S. 183 (1931)

51 S.Ct. 380, 75 L.Ed. 953

Interstate Transit, Inc.

v.

Lindsey

No. 358

United States Supreme Court

April 13, 1931

Argued March 19, 1931

APPEAL FROM THE SUPREME COURT OF TENNESSEE

Syllabus

1. A state tax upon the operation of motor vehicles engaged exclusively in interstate commerce, being a direct burden on that commerce, cannot be sustained unless it appears affirmatively, in some way, that it is levied only as compensation for use of the highways in the state or to defray the expense of regulating motor traffic. P. 185.

2. Tennessee Act of 1927, c. 89, § 4, imposed upon concerns operating interstate motor buses on the highways of the state a privilege tax graduated according to carrying capacity. It is part of a general revenue act which deals with practically all of the taxes laid by the state except those which admittedly provide for defraying

Page 184

the cost of constructing and maintaining highways and regulating traffic thereon, and the revenue derived from it, unlike that arising from the highway statutes, goes not to the highway fund, but to the general funds of the state. Held a privilege tax on the carrying on of interstate business, and repugnant to the commerce clause. P. 186.

161 Tenn. 56; 29 S.W.2d 257, reversed.

Appeal from a judgment reversing a judgment for the transit company in a lower state court, in its action to recover money collected from it as a tax.

Page 185

BRANDEIS, J., lead opinion

MR. JUSTICE BRANDEIS delivered the opinion of the Court.

The Tennessee Act of 1927, c. 89, § 4, imposes upon concerns operating interstate motorbusses on the highways of the state a privilege tax graduated according to carrying capacity. It is $500 a year for each vehicle seating more than twenty and less than thirty passengers. The tax for eight such busses was demanded of Interstate Transit, Inc., an Ohio corporation which operates, exclusively in interstate commerce, a line from Cincinnati, Ohio, to Atlanta, Georgia. The company made a quarterly payment under protest, and brought this suit to recover the amount paid on the ground that the statute as applied violates the commerce clause of the Federal Constitution. The trial court allowed recovery, but its judgment was [51 S.Ct. 381] reversed by the supreme court of the state. 161 Tenn. 56, 29 S.W.2d 257. The case is here on appeal.

While a state may not lay a tax on the privilege of engaging in interstate commerce, Sprout v. South Bend, 277 U.S. 163, it may impose, even upon motor vehicles engaged exclusively in interstate commerce, a charge as compensation for the use of the public highways which is a fair contribution to the cost of constructing and maintaining them and of regulating the traffic thereon. Kane v. New Jersey, 242 U.S. 160, 168-169; Clark v. Poor, 274 U.S.

Page 186

554; Sprout v. South Bend, supra, pp. 169-170. As such a charge is a direct burden on interstate commerce, the tax cannot be sustained unless it appears affirmatively, in some way, that it is levied only as compensation for use of the highways or to defray the expense of regulating motor traffic. This may be indicated by the nature of the imposition, such as a mileage tax directly proportioned to the use, Interstate Busses Corp. v. Blodgett, 276 U.S. 245, or by the express allocation of the proceeds of the tax to highway purposes, as in Clark v. Poor, supra,1 or otherwise. Where it is shown that the tax is so imposed, it will be sustained unless the taxpayer shows that it bears no reasonable relation to the privilege of using the highways or is discriminatory. Hendrick v. Maryland, 235 U.S. 610, 612 [argument of counsel -- omitted]; Interstate Busses Corp. v. Blodgett, 276 U.S. 245, 250-252. Compare Interstate Busses Corp. v. Holyoke Street Ry., 273 U.S. 45, 51. But the mere fact that the ax falls upon one who uses the highway is not enough to give it presumptive validity.

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