Oregon v. Pacific States Tel. & Tel. Co.

Mr. Justice Bean

delivered the opinion of the court.

1. The question whether an initiative measure is subject to the veto power of the Governor was decided in State v. Kline, 50 Or. 426 (93 Pac. 237), and that case is conclusive here. What is said on the subject in Kadderly v. Portland, 44 Or. 118, 146 (74 Pac. 710: 75 Pac. 222), was in answer to the point that the initiative and referendum amendment deprived the Governor of a veto power over acts of the legislature and had no reference to measures proposed by the initiative.

2. The annual license fee required by the act of 1903 to be paid by corporations is a business or excise tax *165 on the right to be or exercise the powers of a corporation, and is in no sense a tax on property; nor is it a tax on the business or franchise which the corporation, when organized, may exercise. Am. S. & R. Co. v. People, 34 Colo. 240 (82 Pac. 531); Delaware R. Tax, 18 Wall. 206 (21 L. Ed. 888); Home Ins. Co. v. New York, 134 U. S. 594 (10 Sup. Ct. 593: 33 L. Ed. 1025). The right to be a corporation, or do business as such, rests entirely within the discretion of the State, and it may therefore require it to pay a specified sum each year, or at stated intervals, for the privilege. The payment of such fee or tax, however, does not exempt the corporation from other forms of taxation. It may be also required to pay a tax on its tangible property and a tax on its intangible property or franchise; the latter to be in proportion to, its income or measured in any other way the lawmaking power may adopt. 27 Am. & Eng. Enc. Law (2 ed.) 932; 57 L. R. A. 98, note. “The State,” says Mr. Justice Field, “may impose taxes upon the corporation as an entity existing under its laws, as well as upon the capital stock of the corporation, or its separate corporate property ; and the manner in which its value shall be assessed and the rate of taxation, however arbitrary or capricious, are mere matters of legislative discretion. It is not for us to suggest in any case that a more equitable mode of assessment or rate of taxation might be adopted than the one prescribed by the legislature of the State. Our only concern is with the validity of the tax. All else lies beyond the domain of our jurisdiction.” 18 Wall. 231 ( 21 L. Ed. 888). See, also, Maine v. Grand Trunk Ry. Co., 142 U. S. 217 (12 Sup. Ct. 121: 35 L. Ed. 994). Among the elements of corporate taxable values are' the franchise, capital stock in the hands of the corporation, the tangible corporate property, and shares of stock in the-hands of individual holders; and all of the authorities agree that a tax upon the franchise, whether based on income or measured in some other manner, and a tax *166 on the tangible corporate property, is not double taxation. Cooley, Taxation, 406; Com’rs v. Tobacco Co., 116 N. C. 441 (21 S. E. 423); Home Ins. Co. v. New York, 119 U. S. 129 (8 Sup. Ct. 1385: 30 L. Ed. 350); Commonwealth v. New England Slate & Tile Co., 13 Allen (Mass.) 391; Commonwealth v. Railroad Co., 150 Pa. 234 (24 Atl. 609); Wil. Col. & Augusta R. Co. v. Board of Commissioners of Brunswick County, 72 N. C. 10; State Tax Ry. on Gross Receipts, 15 Wall. 284 (21 L. Ed. 164).

3. Nor does the fact that plaintiff may have paid all taxes assessed and levied on its property, “including the value of its franchise,” render invalid the law levying a tax on its gross income. At the time the assessment and levy alluded to were made, there was no law .specifically requiring the franchise of a corporation to be assessed, nor providing the manner of estimating the value thereof, and clearly a law on the subject regularly enacted could not be rendered nugatory or invalid by local assessors including in the value of corporate property their estimate of the value of the franchise.

4. Whether the initiative and referendum amendment to the constitution is invalid, because repugnant to the provisions of the Constitution of the United States, was thoroughly argued to and considered by this court in Kadderly v. Portland, 44 Or. 118 (74 Pac. 710: 75 Pac. 222), and the views of the court as then and now entertained are indicated in the opinion filed in that case, and it is needless to re-state them at this time.

It follows from these views that the judgment of the court must be affirmed, and it is so ordered.

Affirmed.