69 A.2d 405 | Pa. | 1949
The question is the extent to which certain meat-packing establishments in Allegheny County are subject to mercantile license taxes levied by the City of Pittsburgh and the School District of Pittsburgh for the year 1948.
The Act of June 25, 1947, P. L. 1145, gave authority to cities of the second class A and certain other political subdivisions to levy such taxes on persons, transactions, occupations, privileges, subjects and personal property within their limits as they should determine, but not on a privilege, transaction, subject, occupation or personal property which then was, or should thereafter become, subject to a State tax or license fee. In pursuance of this authority the City of Pittsburgh, on December 1, 1947, enacted an ordinance imposing annual mercantile license taxes upon persons engaged in certain occupations and businesses at the rate of one mill on each dollar of the volume of the annual gross business transacted by wholesale vendors and dealers and two mills in *112
the case of retail vendors and dealers; the terms "dealer" and "vendor" were not to include, however, persons vending articles of their own growth, production or manufacture thereof. The validity of this ordinance was upheld in Federal Drug Co. v.Pittsburgh,
The Act of June 20, 1947, P. L. 745, imposed upon wholesale and retail vendors and dealers in school districts of the first class (of which the School District of Pittsburgh is one) a mercantile license tax at the rate of one-half mill on each dollar of the volume of the annual gross business transacted by wholesale vendors and dealers and one mill in the case of retail vendors and dealers; the terms "dealer" and "vendor" were not to include, however, persons vending articles of their own growth, produce or manufacture.
The court below sustained the packers' claim to exemption from the City tax because of their payment to the Department of Agriculture of the annual fee of $10. We are not in accord with that conclusion. The mere name that may be given in a statute to a tax or a license fee is not determinative of its real nature, and we do not believe that the $10 fee prescribed in the Act of May 11, 1945, P. L. 454, to accompany the application "for registration and license" is a true "license fee" within the meaning of that term as employed in the Act of June 25, 1947, P. L. 1145. A license fee is one exacted for the purpose of regulating an occupation or privilege which *113
is deemed to be in need of public control, and, ordinarily, it is designed for the sole purpose of reimbursing the sovereign, in whole or in part, for the necessary expense of enforcing and administering such control; if it exceeded the amount required for that purpose it would become a tax for revenue and cease to be a valid license fee. "A license fee is a charge which is imposed by the sovereign, in the exercise of its police power, upon a person within its jurisdiction for the privilege of performing certain acts and which has for its purpose the defraying of the expense of the regulation of such acts for the benefit of the general public": Pennsylvania Liquor ControlBoard v. Publicker Commercial Alcohol Co.,
We come, then, to the question as to which of the operations carried on by these meat-packers are in the nature of manufacturing and therefore excluded from liability for the tax both under the ordinance of the City of Pittsburgh and under the Act imposing the mercantile license tax in school districts of the first class. The City ordinance exempts persons who vend articles "of their own growth, production or manufacture," the Act imposing the school district tax exempts persons who vend articles "of their own growth, produce or manufacture." The words "production" and "produce" were undoubtedly intended to have the same meaning, and it was held in Rieck-McJunkin DairyCo. v. Pittsburgh School District,
The court below held that certain articles produced by the packers were manufactured, — a ruling not contested by the City or by the School District; the items so characterized are soap, soap chips, soap flakes, bar soap, liquid soap, glue, sandpaper, cosmetics, animal shortening, vegetable shortening, oleomargarine, sausages, luncheon meats, liverwurst, puddings, bologna, glycerin, feed meal, fertilizer, butter, cheese, and ice cream.
The following items were held by the court not to be manufactured articles: — the principal cuts of meat, such as (in the case of hogs) hams (including boiled and baked hams), feet, backs, bacon, sides, butts, loins, spare ribs, and bellies, and the corresponding cuts from cattle, sheep and calves, also milk and milk products except cottage cheese, butter, and ice cream. The packers appeal from that ruling, but their attack upon it is unjustified. Of the animal carcasses handled in their establishments some, after being skinned and de-haired, are merely halved or quartered and then refrigerated for the purpose of preservation until sold as fresh, unprocessed meat, — beef, mutton, lamb or veal, as the case may be. Others are cut up into their various parts and the different portions subjected to such operations as cleaning, drying, pickling, salting, smoking, boiling, baking and the like, — all in order to prepare them for the market but without causing any appreciable alteration in their sizes, forms, textures, substance or composition. Such treatments do not constitute manufacturing as that term has been construed in repeated decisions of this Court, but are merely processing operations analogous to the milling of grain, the spinning of cotton, or the pasteurizing and homogenizing of milk; curing meat consists merely of drying, salting and smoking it in order to keep it indefinitely in an edible condition and impart to it a desired flavor; it is "the permanent *116
halting . . . of the destructive processes of nature":Commonwealth v. Clark,
In Commonwealth v. Consolidated Dressed Beef Co.,
There are four articles which the court below held to be manufactured products and which are the subject of appeals by the City and the School District, namely, lard, tallow, grease, and hides; its ruling that ice is "manufactured" is also questioned. In our opinion, none of these products is a manufactured article. Lard is hog fat cooked in tanks under steam pressure whereby the rendered fats are drawn off to the top and separated from the water and other residue; it is then refined, bleached, mixed with a preservative ingredient, textured and packaged; sometimes it is also hydrogenated. InCommonwealth v. Fried Reineman Packing Co.,
In Appeal No. 224, March Term, 1949, the decree is reversed and the bill dismissed at appellant's costs. In all the other appeals here involved the decrees are reversed in part and the record is remitted with instructions to enter decrees not inconsistent with this opinion; costs to be equally divided between the packers on the one side and the City and School District on the other.