Colonial Pipeline Co. v. Agerton, 9231
Decision Date | 28 February 1973 |
Docket Number | No. 9231,9231 |
Citation | 275 So.2d 834 |
Parties | COLONIAL PIPELINE COMPANY, Plaintiff-Appellee, v. E. Lee AGERTON, Collector of Revenue, Defendant-Appellant. |
Court | Court of Appeal of Louisiana — District of US |
R. Gordon Kean, Sanders, Miller, Downing & Kean, Baton Rouge, for plaintiff-appellee.
Whit M. Cook, II, Baton Rouge, for Collector of Revenue defendant-appellant.
Before SARTAIN, BLANCHE and WATSON, JJ.
This litigation involves the application of R.S. 47:601 (Franchise Tax) Act No. 325 of 1970.
The issues presented herein are identical to those presented in Colonial Pipeline Company v. Mouton, La.App., 228 So.2d 718 (1969), writs refused 255 La. 474, 231 So.2d 393.
The Collector of Revenue of the State of Louisiana (Collector) levied a 'tax' on the plaintiff pursuant to the 1970 amendment. Colonial Pipeline Company (Colonial) paid the taxes under protest and instituted this action to recover the same.
The trial judge held that there was little, if any, difference between R.S. 47:601 (Act 437 of 1958) and the statute after its amendment. We affirm.
R.S. 47:601, as amended by Act 437 of 1958, read as follows:
The same section as amended by Act 325 of 1970 now reads:
' § 601. Imposition of tax
'Every domestic corporation and every foreign corporation, exercising its charter, or qualified to do business or actually doing business in this state, or owning or using any part or all of its capital, plant or any other property in this state, subject to compliance with all other provisions of law, except as otherwise provided for in this Chapter shall pay an annual tax at the rate of $1.50 for each $1,000.00, or major fraction thereof on the amount of its capital stock, surplus, undivided profits, and borrowed capital, determined as hereinafter provided; the minimum tax shall not be less than $10.00 per year in any case. The tax levied herein is due and payable on any one or all of the following alternative incidents:
(1) The qualification to carry on or do business in this state or the actual doing of business within this state in a corporate form. The term 'doing business' as used herein shall mean and include each and every act, power, right, privilege, or immunity exercised or enjoyed in this state, as an incident to or by virtue of the powers and privileges acquired by the nature of such organizations, as well as, the buying, selling or procuring of services or property.
(2) The exercising of a corporation's charter or the continuance of its charter within this state.
(3) The owning or using any part or all of its capital, plant or other property in this state in a corporate capacity.
It being the purpose of this section to require the payment of this tax to the State of Louisiana by domestic corporations for the right granted by the laws of this state to exist as such an organization, and by both domestic and foreign corporations for the enjoyment, under the protection of the laws of this state, of the powers, rights, privileges and immunities derived by reason of the corporate form of existence and operation. The tax hereby imposed shall be in addition to all other taxes levied by any other statute. (Emphasis ours)
It was stipulated that Colonial's operations in the State of Louisiana have not changed since the first Colonial case.
The Collector argues that significant changes were made in the operating incidents of the statute. Further, that the alternative incidents (Sections 1 thru 3) are sufficient to support a valid application of the franchise tax upon Colonial.
In his written reasons for judgment the trial judge held, inter alia, that the three incidences in themselves are not sufficient and quoted Colonial Pipeline v. Mouton, La.App., 228 So.2d 718, 722, as follows:
The major difference that we find in R.S. 47:601 is the removal of the statement 'privilege to do business' and the addition of the 'corporate form' incident. We believe this to be a distinction without a difference.
In the first Colonial case we made a comprehensive analysis of the cases involving the imposition of a franchise tax upon companies engaged in interstate commerce. First, we recognized that Congress has the exclusive power under the Commerce...
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...state in a corporate form.' Again, the Court of Appeal held the tax unconstitutional as applied to the appellant. Colonial Pipeline Co. v. Agerton, 275 So.2d 834 (La.App.1973). But this time the Louisiana Supreme Court upheld the new tax. 289 So.2d 93 By a 7-to-1 vote, this Court affirmed. ......
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