Orange State Oil Co. v. Amos

• Decision Date: 17 October 1930
• Parties: ORANGE STATE OIL CO. v. AMOS, State Comptroller.
• Court: Florida Supreme Court

130 So. 707

100 Fla. 884

ORANGE STATE OIL CO. v. AMOS, State Comptroller.

Florida Supreme Court

October 17, 1930

En Banc.

Suit by the Orange State Oil Company, a Florida corporation, against Ernest Amos, as State Comptroller. From an order sustaining a general demurrer to the bill, complainant appeals.

Affirmed. Appeal from Circuit Court, Leon County; E. C Love, Judge.

COUNSEL

Hudson & Cason and Park H. Campbell, all of Miami for appellant.

Fred H Davis, Atty. Gen., and H. E. Carter, Asst. Atty. Gen., for appellee.

OPINION

STRUM J.

Sections 1153 and 1164, Comp. Gen. Laws 1927 (chapters 12037 and 12012, Acts 1927), require 'every dealer' in gasoline, in addition to other taxes, to pay a tax aggregating five cents per gallon for 'every gallon' of gasoline sold by him.

The question here presented is whether or not this tax applies to the sale of gasoline to municipalities.

Appellant, a dealer in gasoline, has sold large quantities of gasoline to the city of Miami, a municipal corporation, and upon those sales seeks to enjoin the collection by the comptroller of the taxes imposed by the statutes just mentioned. A general demurrer to the bill was sustained, from which order this appeal is taken.

Appellant contends that, since the amount of the tax is added by the dealer to the price of the gasoline and is paid by the purchaser, the dealer thus acts merely as a collecting medium; the ultimate result being that the tax becomes a tax against the city upon every gallon of gasoline purchased by it, no tax being due until there has been a sale by the dealer upon which title to the gasoline passes to the purchaser. This contention is upon the theory that a tax upon the sale of an article which is added to the purchase price is a tax upon the article itself in the hands of the purchaser, and that section 897, Comp. Gen. Laws 1927, which exempts 'all public property' of the several cities defeats the tax upon gasoline sold to municipalities, since the amount thereof is paid by the purchaser.

To support these views, appellant relies upon Western Union Tel. Co. v. Texas, 105 U.S. 460, 26 L.Ed. 1067; Brown v. Maryland, 12 Wheat, 419, 6 L.Ed. 678; Jaybird Mining Co. v. Weir, 271 U.S. 609, 46 S.Ct. 592, 70 L.Ed. 1112; Gillespie v. Oklahoma, 257 U.S. 501, 42 S.Ct. 171, 66 L.Ed. 338; Panhandle Oil Co. v. Mississippi, 277 U.S. 218, 48 S.Ct. 451, 72 L.Ed. 857, 56 A. L. R. 583; and like cases. In those cases state taxes, both ad valorem and excise, were held invalid as constituting burdens upon interstate commerce, upon the importation of foreign goods, or upon the federal government, its agencies, property, or the exercise of its functions.

It is true that, for the purpose of applying the prohibitory mandates of the Federal Constitution, it was held in effect in Brown v. Maryland, supra, that, where a tax is so devised that the burden thereof falls upon an article which is the subject to taxation, the tax is to be considered as laid on the article, rather than on him who is charged with the duty of paying it into the treasury, and in that sence a tax upon the sale of an article 'imported only for sale' is a tax on the article itself; and in Panhandle Oil Co. v. Mississippi, supra, that to employ the number of gallons of gasoline sold the United States as a measure of the privilege tax on the sale of such gasoline is, in substance, to tax the sale, and therefore to exact a tax tribute from the United States. That decision rests upon the elemental proposition that the United States, being in all respects a coequal sovereignty with the states, and in its own sphere a superior sovereignty, is immune from taxation by the states. A municipality is in no sense a superior, or even a coequal, sovereignty with the state. It is a subordinate political entity, subject to the plenary control of the state. Constitution, art. 8. In the federal cases above cited, the court had under consideration the prohibitions of the Federal Constitution just above mentioned as affecting the power of the states in the imposition of taxes.

This case presents an altogether different question and considerations control here other than those involved in the federal cases just above cited. Here we are dealing with a question of exemption rather than a question of the power to impose a tax. The term 'exemption' presupposes the existence of a power to tax; the power being forestalled by some constitutional or statutory provision. Appellant concedes the power of the Legislature to tax municipalities. The question here is therefore one of statutory construction as to whether or not, if this be a tax which falls upon the municipality, it is one from which the municipality is exempt under section 897, supra, or by an implied exception to sections 1153 and 1164, supra.

When considering the taxation of individuals, the rule is that exemption provisions will not be enlarged by construction, nor can they rest upon implication. Texation is the rule; exemption is the exception which must be created by clear and definite terms.

In respect to taxation of cities, however, the rule is otherwise. Inasmuch as taxation of public property would necessarily involve other taxation for the payment of taxes so laid, such property is usually excluded by implication from the operation of laws imposing general taxes, unless there is a clear intent to include it. See Trustees v. City of Trenton, 30 N. J. Eq. 681; City of Jackson v. State, 156 Miss. 306, 126 So. 2; 2 Cooley, Taxation (4th Ed.) § 621. In this respect our statute, section 897, Comp. Gen. Laws 1927, in so far as it relates to cities and counties, is largely declaratory of the general rule independent of statute.

Our Constitution, art. 9, § 1, amongst other things, provides that the Legislature shall prescribe such regulations as shall secure a just valuation of all 'property,' both real and personal, excepting such 'property' as 'may' be exempted by law for municipal and other enumerated purposes. That provision is permissive and relates only to the 'property' of municipalities. Section 897, Comp. Gen. Laws 1927, passed pursuant thereto, exempts all public 'property' of municipalities from taxation. That is a general exemption from 'property' taxes which clearly does not exclude indirect excise taxes, which were not regarded as excluded under the general principles of law of which section 897, supra, is largely declaratory. City of Portland v. Kozer, 108 Or. 375, 217 P. 833; U.S. v. Perkins, 163 U.S. 625, 16 S.Ct. 1073, 41 L.Ed. 287; In re Merriam, 141 N.Y. 479, 36 N.E. 505; 1 Cooley, Taxation (3d Ed.) p. 357, 37 Cyc. 1572.

In Amos v. Matthews, 126 So. 308, and in Amos v Gunn, 84 Fla. 285, 94 So. 615, we held that this tax is an excise tax upon the privilege of selling gasoline. The tax is not upon the property, but is upon the privilege of selling it. It is the price exacted by the state for disposing of this class of property by sale. See U.S. v. Perkins, 163 U.S. 625, 16 S.Ct. 1073, 41 L.Ed. 287. In this respect to tax is analogous to an inheritance tax, which is not laid upon the property but upon the privilege of transmitting it by inheritance. This is not a tax upon 'public property' in the hands of the city. Liability of the dealer for the tax arises contemporaneously with the sale to the city. This tax, like other excise taxes, is not laid upon any particular property, nor does the amount of the tax depend upon the...