Mississippi State Tax Commission v. Flora Drug Co

Decision Date22 May 1933
Docket Number30401
Citation167 Miss. 1,148 So. 373
CourtMississippi Supreme Court
PartiesMISSISSIPPI STATE TAX COMMISSION v. FLORA DRUG CO

(En Banc.)

1. CONSTITUTIONAL LAW.

If statute has reasonable relation to governmental purpose and is calculated to carry out some governmental design, courts cannot strike it down as being "arbitrary" (Const Miss. 1890, section 14; Const. U.S. Amend. 14).

2. CONSTITUTIONAL LAW.

Statutes cannot be declared void merely because they are inconvenient and burdensome, if they are calculated to further governmental purposes.

3. CONSTITUTIONAL LAW.

Statutes cannot be declared invalid on ground they are unwise, unjust unreasonable, or immoral or because opposed to public policy or spirit of Constitution.

4. CONSTITUTIONAL LAW.

In passing on act of Legislature to promote public interest court must allow a wide latitude, remembering that legislators may be more familiar with conditions.

5. CONSTITUTIONAL LAW. Licenses.

Tobacco tax statute requiring retailers purchasing from wholesalers not having permit to present tobacco to nearest wholesaler having permit to have stamps affixed field not unconstitutional as imposing arbitrary and unreasonable restriction on lawful business and as being without legitimate basis of classification (Laws 1932, chapter 92; Constitution Mississippi 1890, section 14; Const. U.S. Amend 14).

6. CONSTITUTIONAL LAW.

Courts cannot substitute their judgment for that of Legislature and strike down act because, in court's opinion, act is unwise or oppressive.

7. CONSTITUTIONAL LAW.

Mode of enforcing payment of taxes is entirely within Legislature's control.

8 TAXATION.

"Uniformity of taxation" does not require uniformity of collection, but only uniformity of assessment.

9. LICENSES.

It was within power of Legislature in tobacco tax statute to require that wholesalers affix stamps to all goods presented to them (Laws 1932, chapter 92, section 6).

10. LICENSES.

Under tobacco tax statute, goods can be ordered and delivered from another state into state without stamps being placed thereon until interstate transaction is ended (Laws 1932, chapter 92).

11. LICENSES.

Under tobacco tax statute, where party orders cigars for his own use, no stamps need be affixed (Laws 1932, chapter 92).

12. LICENSES.

That tobacco tax statute requiring retailers purchasing from wholesalers having no permit to present tobacco to wholesaler having permit to have stamps affixed may impose some burden does not make statute invalid (Laws 1932, chapter 92).

13. CONSTITUTIONAL LAW.

Whenever scheme devised affords reasonable facility to state in carrying out some agency or purpose, court cannot say scheme is "arbitrary."

14. CONSTITUTIONAL LAW.

Mere inequalities or exemptions in matter of state taxation are not forbidden by Federal Constitution (Const. U.S. Amend. 14).

15. CONSTITUTIONAL LAW.

Equal protection clause of Federal Constitution does not prevent state from adjusting its system of taxation in reasonable manner, nor compel state to adopt ironclad rule of equal taxation (Const. U.S. Amend. 14).

16. TAXATION.

State's power to classify property for taxation purposes is large, and classification is proper if there is no discrimination in favor of one as against another of same class.

17. LICENSES.

Statute requiring retail dealer purchasing tobacco from wholesaler having no permit to present tobacco to wholesaler having permit to have tax stamps affixed does not discriminate against retailer in town some distance from wholesaler and who buys from wholesaler outside state (Laws 1932, chapter 92; Const. U.S. Amend. 14; Const. Miss. 1890, section 14).

18. TAXATION.

States may adopt reasonable and effective system of taxation, though it may impose hardships, or may impose some individual inequalities.

19. COMMERCE.

Tobacco tax statute requiring retailer purchasing from wholesaler not having permit to present tobacco to wholesaler having permit to have stamps affixed does not burden interstate commerce (Laws 1932, chapter 92; Const. U.S. article 1, section 8, clause 3).

20. EMINENT DOMAIN.

Tobacco tax statute does not violate constitutional provisions prohibiting taking of property for public use without compensation (Laws 1932, chapter 92; Const. U.S. Amend. 5; Const. Miss. 1890, section 17).

21. LICENSES.

Tobacco tax statute requiring retailer purchasing from wholesaler having no permit to present tobacco to wholesaler having permit to have stamps affixed does not discriminate in favor of wholesaler within state, since wholesaler outside state may procure stamps and affix them to merchandise (Laws 1932, chapter 92; Const. U.S. article 1, section & clause 3).

McGOWEN, J., dissenting.

HON. W. H. POTTER, Judge.

APPEAL from circuit court of Hinds county HON. W. H. POTTER, Judge.

Mandamus proceedings by the Flora Drug Company against the Mississippi State Tax Commission. From the judgment, defendant appeals. Reversed and cause dismissed.

Reversed and dismissed.

Walter Sillers, Jr., of Rosedale, for appellant.

There are facts and circumstances which must, of necessity, be considered by the court when called upon to perform the delicate judicial task here involved, such, for instance, as the history of the legislation, the facts disclosed through experience of those charged with administration in the enforcement or lack of enforcement of the law, and other events in our history whether occurring before or after enactment of the statute or of the entry of the judgment in the court below. The court should acquire knowledge of such facts and events and take judicial cognizance of these, as well as all other matters of general knowledge bearing upon or throwing light on the issues joined in this controversy.

Muller v. Oregon, 208 U.S. 412, 52 L.Ed. 551; Dorchy v. Kansas, 264 U.S. 286, 68 L.Ed. 686.

Under section 6, of the Act there is levied and assessed an excise or privilege tax on each dealer of tobacco computed at the rate of one cent for each five cents, or fractional part thereof of the retail selling price.

The rate and amount of the tax is the same on all dealers, wholesale and retail alike, no discrimination, but equal and uniform.

The complaint is not against the tax or any discrimination in the levy thereof, but is made against the provision for administration of the law and the enforcement thereof and collection of the tax thereunder.

This objection is without merit for such provision of the law is not in conflict with the constitutional provision.

The guaranty of the equal protection of the laws does not deprive the states of the power to adjust their systems of taxation in accordance with their ideas of public policy. They may, therefore, tax certain classes of property to the exclusion of other classes, and may prescribe different methods of assessment, different rates of taxation, different means of enforcing the collection of taxes, and different penalties for nonpayment, for different classes of persons or property.

12 C. J. section 881, pages 1151-1152; 12 C. J. section 890, page 1155; 37 Cyc. , page 1190; 37 C. J. 186.

It is well established by authority that occupations and forms of business may be classified for the purpose of excise license or privilege taxation.

1 Cooley on Taxation (4 Ed.), page 748; 37 C. J., page 201; 17 R. C. L. 518; Wingfield v. South Carolina Tax Commission, 144 S.E. 846; Columbus Southern Ry. Co. v. Wright, 151. U.S. 469, 38 L.Ed. 238.

An excise tax is not open to attack on the ground of inequality because of unavoidable inequalities of result not originating in the law but growing out of inequalities in business conditions and activities.

Sanchez Morales & Co., Inc. v. Porto Rico Automobile Co., Inc., 18 F.2d 550; Commonwealth of Pa., to the use of the city of Titusville v. Clark, 57 L. R. A. 348.

A statute taxing retailers at a higher rate than wholesalers does not violate the 14th Amendment to the Constitution of the United States.

Knisely v. Cotterel, 196 Pa. 614.

A license or occupation tax is valid, under the various constitutional provisions relating to equality and uniformity, if it applies equally and without discrimination to all persons engaged in the same particular business or avocation, or exercising the same privileges, or if the occupations or privileges and the persons engaged therein are classified for taxation according to reasonable and well recognized lines of distinction, it does not matter how few the persons are who may be included in a class, so long as all who are or may come into the like situation or circumstances are embraced in the class.

37 C. J. 201; 17 R. C. L. 518; Clarksdale Ins. Agency v. Cole, 87 Miss. 637; Bank v. Worrell, 67 Miss. 47, 7 So. 219; Holberg v. Town of Macon, 55 Miss. 112; Postal Tel. & C. Co. v. Robertson, 116 Miss. 204; State v. Widman, 112 Miss. 1, 72 So. 782; Knisely v. Cotterel, 196 Pa. 614, 50 L. R. A. 86.

In the collection of any tax of whatever nature and character some person is going to be put to more trouble and expense and caused to suffer some hardship that others will avoid and escape. This is in the very nature of things, and if every tax law because of such is declared to be invalid, then no law can meet the test and all of our revenue laws must fall.

Knisely v. Cotterel, supra.

The sections complained of in this act do not do violence to the Fourteenth Amendment to the Federal Constitution or to section 14 of the state Constitution.

Chapter 92, Laws of 1932, or sections 3, 5 and 6 thereof do not come in conflict with or violate the Fifth Amendment to the Federal Constitution or section 17 of the state Constitution.

Brown v. New Jersey, 44 L.Ed. 119; Gulf & Ship Island R. R. Co....

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