187 Pa. Super. 387 | Pa. Super. Ct. | 1958
Opinion by
Albright and Friel, Inc., a firm of consulting engineers, maintains its office in Philadelphia. The company renders some of its service in Philadelphia and some outside of Philadelphia.
It filed general tax returns with the School District of Philadelphia for the years 1953 and 1954 which were based on the receipts for the years of 1952 and 1953. The tax was paid on the receipts which were received from clients located within the School District of Philadelphia. The School Revenue Commissioner made a demand for additional tax for each of the two years on total receipts regardless of where earned.
Appellant asked for an injunction to restrain the collection of the additional tax. After answer filed the case was heard by Judge Morgan Davis and an adjudication was rendered on March 28, 1957. Exceptions were dismissed and a final decree was entered on April 1, 1958. This appeal is from the final decree. We are called upon to determine whether all of the receipts, including services rendered outside the School District of Philadelphia but directed from appellant’s only office in Philadelphia are taxable under the provisions of the Act of May 23, 1949, P. L. 1669.
The company is engaged in designing and supervising of construction of sewer systems, bridges, water
Section 3 of the Act provides as follows:
“Every person engaged in any business in any school district of the first class shall pay an annual tax at the rate of one (1) mill on each dollar of the annual receipts thereof.” There is no doubt that the company is engaged in a business or profession in Philadelphia within the meaning of the Act; the only issue is the question whether or not all of the receipts are taxable under the Act. Appellant contends that, the only taxable receipts are receipts from business done within the district, and that the tax is a tax on transactions which occur within the district rather than a tax on the privilege of doing business in the district.
It is difficult to agree with this argument because the Act provides that the tax shall be paid on each dollar of the annual receipts and not on the transactions which occur within the district. The tax is on the privilege of doing business in the district and on the gross receipts of all persons engaged in business within the district. There are provisions in the Act which cover situations where companies have offices both within the district and outside, also to avoid problems involving the taxation of interstate commerce. Keystone Metal Company v. Pittsburgh, 374 Pa. 323, 97 A. 2d 797.
Among other questions we have considered the matter of allocation raised by the taxpayer in this case. Appellant has not established that, for purposes of allocation, the services rendered by its office in Philadelphia were not the decisive factors upon which the gross receipts were based. The drawings, specifications, and preparations for the projects were performed in Philadelphia.
The record clearly discloses that all of the company’s activities are directed from Philadelphia; and that no second tax was imposed by the same taxing authority.
It is quite logical to conclude that the legislature
Decree of the lower court is affirmed.