Powell v. Gleason

• Decision Date: 29 November 1937
• Docket Number: Civil 3933
• Citation: 74 P.2d 47,50 Ariz. 542
• Parties: JAMES L. POWELL, as Assessor of Cochise County, State of Arizona, and as Agent of the Motor Vehicle Division of the Arizona State Highway Department, Appellant, v. R. I. GLEASON, JOE COLFORD and SCHOOL DISTRICT NUMBER 2 of the County of Cochise, State of Arizona, Appellees
• Court: Arizona Supreme Court

74 P.2d 47

50 Ariz. 542

JAMES L. POWELL, as Assessor of Cochise County, State of Arizona, and as Agent of the Motor Vehicle Division of the Arizona State Highway Department, Appellant, v. R. I. GLEASON, JOE COLFORD and SCHOOL DISTRICT NUMBER 2 of the County of Cochise, State of Arizona, Appellees

Civil No. 3933

Supreme Court of Arizona

November 29, 1937

APPEAL from a judgment of the Superior Court of the County of Cochise. John Wilson Ross, Judge. Judgment affirmed.

Mr. Joe Conway, Attorney General, Mr. J. M. Johnson and Mr. W. E Polley, his Assistants, and Mr. Frank E. Thomas, County Attorney of Cochise County, for Appellant.

Messrs Sutter & Gentry, for Appellees.

OPINION

LOCKWOOD, J.

This is an appeal from a judgment of the superior court of Cochise county holding void, as unconstitutional, chapter 66 of the Regular Session of the Thirteenth Legislature of the state of Arizona. The chapter reads, so far as material to the issues of this case, as follows:

"1635a.... In addition to the fees provided by chapter 31, Revised Code of 1928, and amendments thereto, every owner of a motor vehicle, trailer or semi-trailer operated upon the highways of this state, if such vehicle be subject to a registration fee, shall pay annually to the county assessor, at the time of the application for registration, a tax on such motor vehicle, trailer or semi-trailer equal to three cents on each dollar on the full cash value of such vehicle, provided that the taxes on any motor vehicle, trailer or semi-trailer registered from any incorporated city or town in this state, shall be four cents on each dollar of full cash value of such vehicle, and provided further that such tax on any new vehicle or any vehicle not previously registered in this state, which shall be registered after the beginning of the registration year, shall be reduced by one-twelfth for each full month that shall have elapsed since the beginning of the registration year for which registration is sought at the time when such vehicle becomes subject to registration. No motor vehicle, trailer, or semi-trailer shall be registered without the tax herein provided shall have been paid.

"1635b.... The county assessor shall determine and fix the full cash value of such vehicle at the time the tax is paid. The prima facie full cash value shall be as follows:

"1. During the first calendar year of the life of the vehicle sixty per centum of the manufacturer's list price of a similar or corresponding model of the same make, plus the cost or manufacturer's list price of equipment, apparatus, hoists, other types of body, or other equipment attached to or added to the vehicle after its purchase, and not included in the manufacturer's list price of the vehicle.

"2.During each succeeding year thereafter the prima facie full cash value shall be determined by reducing the prima facie full cash value for the first calendar year of the life of the vehicle, one-fourth; provided, that the prima facie full cash value shall not be reduced below the sum of one hundred dollars.

"1635c.... The county assessor shall determine and fix the full cash value of such vehicle at the time the tax is paid. The prima facie full cash value shall be as follows:

"1. During the first calendar year of the life of the vehicle sixty per centum of the manufacturer's list price of a similar or corresponding model of the same make, plus the cost or manufacturer's list price of equipment, apparatus, hoists, other types of body, or other equipment attached to or added to the vehicle after its purchase, and not included in the manufacturer's list price of the vehicle.

"2. During each succeeding year thereafter the prima facie full cash value shall be determined by reducing the prima facie full cash value for the first calendar year of the vehicle thirty-three and one-third per cent. and thirty-three and one-third per cent. during each succeeding calendar year; provided, that the prima facie full cash value shall not be reduced below the sum of two hundred and fifty dollars.

" 3. Motor vehicles, trailers and semi-trailers, which are operated in this state in interstate commerce, shall be assessed, hereunder, by the vehicle superintendent at that proportion of such full cash value, as the whole number of miles travelled, or which it is estimated will be travelled annually in this state, bears to the total annual mileage so travelled, or which it is estimated will be travelled, by such vehicle. Such mileage shall be estimated and determined by the vehicle superintendent under such rules and regulations as he shall from time to time prescribe. All taxes collected under subsection 3 shall go to the state general fund.

"1635d.... For the purpose of ad valorem taxation, motor vehicles shall be deemed to constitute a class separate and distinct from other tangible personal property or classes thereof. The tax herein imposed shall be in lieu of all other taxes on any such motor vehicle as tangible personal property but shall not be deemed to affect any excise tax or tax based upon factors other than the value thereof. The tax on any motor vehicle shall never be charged against nor deemed to constitute a lien on the real property of the owner thereof.

"1635e.... The county assessor shall forthwith transmit from the taxes collected under the provisions of this act upon any vehicle, to the state treasurer an amount equal to one-fourth cent on each dollar of the full cash value of the vehicle together with a statement showing the vehicle taxed, its full cash value, the residence of the owner of said vehicle, the amount of the tax collected, and exemptions allowed. If the vehicle is registered from any incorporated city or town in this state the county assessor shall forthwith transmit to the treasurer of such city or town for the use of such city or town an amount equal to one cent on each dollar of the full cash value of such vehicle. The balance of the tax received by the county assessor shall be paid into the county treasury to be properly distributed by the county treasurer."

Briefly summarized, it provides as follows: When the owner of a motor vehicle applies for its annual registration he shall pay to the county assessor a tax thereon which is calculated in the following manner: The assessor fixes the prima facie cash value of the car, if it be of that year's model, at 60 per cent. of the manufacturer's list price, and for each succeeding year deducts one-fourth of the first year's valuation, but never reduces the prima facie cash value below the sum of $100. The owner is required to pay a tax equal to 4 cents on the dollar of valuation thus fixed, if he be a resident of an incorporated town or city in Arizona, otherwise at 3 cents on the dollar. If the application for registration be made at any time after the beginning of the calendar year, the tax paid is reduced by one-twelfth for each full month that has elapsed from the beginning of the year until the time of the application. This is the method under section 1635a which applies to motor vehicles not used as common carriers. The valuation of motor vehicles operating as common carriers is fixed under section 1635c, and is based upon a somewhat different method. Motor vehicles are declared to be a class separate from other tangible personal property for the purpose of ad valorem taxation. The tax so levied and collected is declared to be in lieu of all other taxes upon motor vehicles as tangible personal property, but does not exempt them from the payment of any excise tax or a tax based on factors other than the actual value thereof. This tax is distributed by the assessor to the state, the county treasurer, and the city or town in which the owner resides in the proportions fixed in the chapter.

It is claimed by appellees that this statute is unconstitutional for a number of different reasons, which we shall consider as seems advisable. We think the first thing for us to do is to determine the nature of the tax in question. Taxes fall into many different classes, and the tests as to their validity frequently differ in accordance with their nature. The three principal forms now in use are ad valorem property excise, and income taxes. The phrase "ad valorem" means, literally, "according to the value," and is used in taxation to designate an assessment of taxes against property at a certain rate upon its value. Webster's New International Dictionary. An ad valorem property tax is invariably based upon ownership of property, and is payable regardless of whether it be used or not, although of course the value may vary in accordance with such factor. It is neither intended nor expected that it be passed on, though under some circumstances, as with rental property, this may be done. It, for many years, has been the chief, and frequently the only, method of securing revenue for the states and their local subdivisions. An excise tax, on the other hand, is a direct tax laid on merchandise or commodities, which is generally meant to be passed on to the consumer. It may or may not have an ad valorem factor therein. Scholey v. Rew, 23 Wall. (90 U.S.) 331, 23 L.Ed. 99. Income taxes are precisely what the name signifies; taxes based on income in money, gross or net. We think the legislature has fixed the nature of the tax in question in section 1635d, supra. Motor vehicles are first placed in a separate class from other tangible personal property. It then is declared that this is done for the purpose of ad valorem taxation, and that the tax imposed by the act is in lieu of all other taxes on the property as tangible personal property, but that it shall not be deemed to relieve it of any excise tax or tax based on a factor other than its value. It would be difficult to...