*1 No. [File 7184] CO., Corporation, Appellant, v. JOHN F. W. WOOLWORTH of the State North as Tax Commissioner GRAY, Dakota, Respondent.
(46 295) NW2d Opinion February 5, filed
n *2 Bright, Vogel appellants. Vogel, for &
Wattorn, Attorney Warner., Sattire, E. General P. O. Wallace As- Attorney respondent. General, sistant
Cupler, Serhland, Tenneson & Amicus Curiae. plaintiff:,' corporation, J. The a New York Christianson, against brought this action the Tax Commissioner of the State which the sum of it is al- $1486.96 recover Dakota of North plaintiff corporation required the leged defendant provisions Chap- of Laws 1949, under pay exacted taxes as Chapter commonly Supp 1943, 57-39, NDRC -341, ter ; Tax Act. the Retail Sales as known complaint plaintiff alleges in that the is a plaintiff its existing organized foreign corporation and under laws of qualified duly regularly York of New the State in North do business the State Dakota to of the State the latvs merchandising That engaged business therein. in the duly qualified Tax Commissioner elected is defendant charged law with Dakota and such of North of the State Chapter commonly administering duty Laws plaintiff That Law. en- Retail Tax Sales known as i of North gaged the State Dakota of merchandise sale provisions qualified under the has cities and six different by obtaining permit Law from Retail Sales de- and all of stores. for each fendant provisions of Tax Law, said the terms Sales That under provided by plaintiff, in the manner law, to, the above referred Commissioner, the defendant here- to the Tax and returned made including period July up to and the 30th 1,1949, in, report September day and correct of all a true sales of during in this state said at its various sold merchandise stores period, *4 time to said defendant the total at the same and did on individual sales where the of the tax collected amount amount twenty-four exceeded the sum of cents. involved Chapter provisions of the terms and said of That under year North Dakota for Laws of the State of the Session permitted collect from the consumer a tax to no retailer is paid where the amount 'of merchandise sales individual twenty-five cents, and no retailer of is less than merchandise payment of North the State is liable for the merchandise twenty- any of less than tax individual sales of on such Dakota cents. five provisions plaintiff was law
. and of said That under terms any purchaser permitted or con- not collect from and did twenty-five tax on individual sales of than less sumer cents. provisions despite plaintiff, That, law, the terms and of said payment of the time amount at of full of collected provisions and in accordance of under with said law, was required by pay the defendant to the additional sum of $1486.96, being necessary the Tax amount claimed Commissioner as equal in order two on all within the cent State during period including North Dakota said the individual twenty-five than less cents. payment That the at time $1486.96 said was said made un- protest solely prosecution by written and in der order avoid invoking by against defendant and the the defendant as this penalties plaintiff provided. in said law specific plain provisions That under the and and terms of said Chapter 341 of Session Laws for no tax or was is due twenty-five on individual'sales less than and the cents, collec- by the of a tion defendant tax on such sales from the retailer, greater fact the collection of retailer than such lawfully permitted retailer under law said to collect from the purchaser illegal, or consumer is invalid, unreasonable, discrim- contrary inatory, rights wholly plaintiff, and un- owing reason lawful for the that the due and under said law solely only against against is a the consumer and not the retailer. plaintiff operated by
That at this each store owned it in kept the State of North an Dakota accurate correct record permitted' all tax which under said law it was to alleged, and, collect did hereinbefore remitted to the defend- the full amount of such tax so ant collected. wholly plaintiff during period
That said unable was bracket law, under so-called contained said to col- any part recoup portion of the excess tax in amount lect compelled by pay which the defendant $1486.96, protest. did plaintiff prior
That to the commencement of this action writing upon-the made defendant for a return said demand *5 unlawfully illegally from collected sum of so $1486.96 by the defendant was plaintiff defendant,.which demand things refused. in all prays judgment with interest for the sum of $1486.96
Plaintiff together payment legal thereof from the-date at rate thereon and disbursements. with costs' demurred, ground complaint
The defendant action. a cause of to constitute state facts sufficient does not sustaining and the the demurrer made an order trial court appealed. plaintiff has in in this state enacted law first was The Retail Sales — May two-year period, 1, 1935, to limited to a
1935 and was Chapter In 1937 an con- May 276. act 1935, 1, 1937. Laws pe- provisions substantially for a taining was enacted the same ending. beginning May 30, 1939. Laws June 1, 1937, riod two-year periods Chapter and con- similar 249. Acts for 1937, taining provisions substantially those as contained the same by legislative assemblies in 1935 were enacted law enacted Chapter 1939, 234; 1945, and 1947. Laws 1941, 1943, in 1939, Chapter Chapter 264; 1945, Laws 1941, 283; Laws 1943, Laws Chapter Chapter 1947, 308; Laws (Laws present Tax law Retail introduced the Sales
As years previous Chapter 341) sub- for the contains like the acts original provisions stantially in the those embodied the same change passage, however, In the course of enactment. oper- plaintiff Act, 6 of the 1949 which claims made in Sec. receipts exempt on all from the sales or exclude ates payment plaintiff purchaser paid and the received where the twenty-four or less. cents Assembly Legislative Tax law enacted
The Retail Sales Many adopted Iowa. the sec- in 1935was state slightest change. adopted That is true tions were without See, Laws of Iowa 7 of the 1935 enactment. of Sections 6 and Chapter Extraordinary IV, Div Session, 45th G. A. seq; Sec 329-F1, 37 et 6943-F37. Iowa-.1935, Sec Code of Ch provided: Chapter 276, Laws “ (f) receipts’ the- total amount of Sec. means ‘Gross money, money sales of whether received valued retailers, *6 provided,'however, any purposes otherwise, or for discounts and taken on allowed sales shall not be included, nor shall the by price property returned sale when customers the full sale price by thereof is refunded either in cash or credit.....” hereby imposed, beginning day
Sec. 2. “There is the first May, May ending (2%) 1937, a of two cent upon gross receipts tangible personal prop- from all sales- erty, consisting goods, except wares, or merchandise, as other- provided in wise division, this sold at retail in the State of North Dakota to users; consumers or . . . computed herein
“The tax levied shall be and collected as provided.” hereinafter Exemptions. exempted pro-
Sec. 3. This section from the computation of the act and from the visions of the amount imposed by gross receipts of tax from certain described sales gross receipts tangible personal such as prop- from sales of which, erty prohibited taxing the State is under-the Con- stitution or laws of the United or States under the Constitution State. provided paid
Sec. section This that taxes re- ceipts represented accounts found to be worthless and ac- tually charged purposes may off for income tax be credited subsequent payment of the tax and that if such accounts are paid upon collected the retailer a tax thereafter shall-be provisions the amount so collected and that the of the act shall apply gasoline, cigarettes, sales of etc. or other product, occupation upon business or which the State North may impose special now or hereafter Dakota tax, either in stamp form of tax, license tax or otherwise. Provided, may agency apply Sec. 5. relief to the com- paid upon missioner and receive a refund for taxes sales to it goods, or wares merchandise for free used distribution to the. poor needy.
Sec. reads as follows: practicable, “Retailers imposed shall, as far as add the tax average equivalent act, or thereof, to the sales charge when added such shall constitute a charge, a debt from consumer or user shall be of such paid, at law the same be recoverable until and shall to retailer other debts. manner as competing adoption
“Agreements retailers, between organizations regulations by appropriate or associa- rules adding provide uniform methods retailers to tions of *7 equivalent average and which not involve thereof, do tax or fixing agreements unlawful, and which shall otherwise expressly approval are the Commissioner, of have first any anti- not to be in violation of shall be held authorized and this laws of state.” trust as follows: 7 reads
Sec. any hold retailer to advertise of shall be unlawful for “It any directly public in- or consumer, or to out or to state by any imposed directly, di- this the tax or thereof by or that it will or absoi'bed the retailer be assumed vision will consumer, in the an element not be considered as any part will refunded.” it or thereof be added, if or required duty every to retailer “It 8. shall'be Sec. preserve pay any report division, this to tax under make a proceeds gross of sales Commissioner as records such every preserve duty may require retailer to and it be the shall goods, years period records of all invoices and other of two for a purchased books, such resale; for and all merchandise or wares, any open at examination shall be to and other records invoices duly any by authorized or one of his time the Commissioner agents.” day 20th before the shall, on or 9. “The retailer
Sec. period quarterly following de- as of the first the close month day the-following 20th or before section, fined in subsequent quarterly period following of three each of the month quarterly period preceding for the return make out a months, by may prescribed the Com- and manner as form such receipts showing the amount retailer, missioner, period further and such return, for the covered require may him enable to information the Commissioner as compute levied; . correctly tax herein . . and colle'ct “Thirty days after the effective date of act, Sec. this it' engage person unlawful for shall be or transact busi- permit permits a retailer within this ness as unless or state, prescribed. Every been him shall have issued to hereinafter person desiring engage in or conduct business as a retailer application within file this state shall with the an Commissioner permit permits. Every application permit for such a prescribed shall be made a form the Commissioner and applicant shall set forth the name under which transacts place places business, intends transact location of his business, such other information as the Commissioner may require. . .”.
Sec. 16. “The Tax Commissioner State of North Dakota hereby charged with the administration of act this and the imposed thereby. power taxes Such Commissioner shall have the authority prescribe regulations all rules and not incon- provisions necessary sistent with the act, and advisable *8 purposes, detailed its administration and to effectuate its including right provide by to for the issuance and sale coupons covering state of the amount of tax or taxes to be paid under if by act, such method is deemed advisable said Commissioner.”
According to its terms the North Dakota Retail Sales Tax operative imposed Act became and were taxes thereunder be- ginning day May, the first meeting 1935. On March 19,1935, of the North Dakota Retail Merchants Association was called Capitol large held at the State in which a number of merchants parts participated. meeting various the State held to consider methods for the collection of the retail sales meeting tax. The then Commissioner "Weeksaddressed the expressed preference system his for the Iowa of collection. Sec- tions 6 and 7 of the North Dakota Retail Sales Tax Act had been adopted bodily from the Iowa law. He discussed schedule adopted that had been for the collection of retail sales taxes Iowa which was identical with the one that later was recom- approved mended the merchants and the Commissioner. n coupon systems He also discussed the for use in the and token expen- clumsy were they that tax and stated of the collection should adopted system the view He stressed sive. to should strive the merchants the customer fair to There- no more.” “no tax but less cent two collect the reciting that a rule adopted the Tax Commissioner after Commissioner, approval “with the merchants retail for the application bracket following adopted tax: No tax 0.14 to $
“$0.01 tax .65 to $ .15 $ 1<¡¡ tax 1.24 .66 to $ $ 2‡ tax to 1.74 $ $1.25 3^ tax to 2.24 $ $1.75 ,$ tax 2.74 to $2.25 tax to 3.24 $ $2.75 ^ tax to 3.74 $ $3.25 7‡ tax 4.24 -to $ $3.75 8‡ tax 4.74 to $ $4.25 9‡ tax to 5.24 $ $4.75 10^ 11 tax to 5.74 $ $5.25 ‡ tax to 6.24 $ $5.75 12^ tax 6.74 $ $6.25 13‡ tax 7.24 to $ $6.75 14^ 7.74 $7.25 $ 15^ 8.24 $ $7.75 16^ 8.74 $8.25 $ 17^ 9.24 $ $8.75 18^ *9 tax 9.74 $9.25 $ 19‡ $9.75 $10.24 ‡ additional Each 50‡ 1‡ or more.” totaling the tax ALL sales Collect 15^
'767 Regu- Dakota Use Tax North Sales'and and Rule Rules See July 1, 1947. issued lations, application tax, and or bracket for the schedule
Such embodying, the same were Tax Commissioner the rule of change several enactments in force without continued including up enacted in 1947. the law Section to and from change enactment was reenacted without as during part enacted that time retail acts the several present including up retail 1947. When Assembly Legislative January 1949 in the in introduced act appeared of 1935 it had in the enactment 6 as Section said succeeding bill and read as follows r embodied laws was imposed or the Act, the tax under this shall add
“Retailers charge average equivalent to the thereof, constitute when added such taxes shall such charge, a debt user to retailer consumer or shall paid, at law in the and shall be recoverable same manner until other debt. “Agreements competing adoption retailers, between or the regulations by organizations appropriate rules and or associa- provide adding uniform tions retailers methods average equivalent'thereof, and which tax or do involve agreements price fixing unlawful, otherwise and which shall approval expressly of the commissioner, have the are au- first held hot thorized and shall be to be violation of anti-trust this state.” laws of Representatives of the House and of
The Journals respect disagreement arose with disclose Senate adopted applied during- bracket or schedule had been previous years brackets, on sales which fell within the lower passed by Representatives elimi- and the bill as the House of paragraph inserted lieu nated the second Section application the tax thereof a bracket or schedule for the *10 768 the first two lines in snch bracket
wherein or schedule read as follows: No $0.34
“$0.01 (cid:127) 1‡ .65 tax” .35 House Journal, 670. changes No were made in the bracket or schedule far so as exceeding on taxes 66 cents were concerned. The bill as passed by Representatives amended so was the House of on February 17, 1949,'with 89 votes-in the affirmative, votes-in negative voting. and 5 absent House Journal, 692- February bill 693. The was transmitted to the Senate on 17, House Journal, 706. striking by provision The Senate amended the bill out the paragraph that had been added the second Section passage Representatives the course of in the House of and in- serting language in lieu thereof the that had been stricken from as 629, bill introduced. Senate Journal 652. The bill as by passed by so amended the Senate was the Senate March 1, on being nega- there votes in the affirmative, .votesin the voting. tive, and absent and not Senate Journal 700. The passed by Repre- bill the Senate to the returned House of sentatives March 1949, Senate Journal 715, House Journal Representatives 1023. The House refused to concur appointed Senate amendments and conference committees were Representatives the House of the Senate. House Journal Senate Journal 742. The conference committees portion recommended that the controversial of Section 6 be following stricken out and that in lieu thereof the be inserted: adding charge, “In retailers shall adopt following application bracket for of the tax:
769 No tax 0.24 to $ $0.01 tax to .74 .25 1‡ tax to 1.24 .75 2‡ tax 1.25 to 1.74 3‡ tax to 2.24 1.75 4‡ tax to 2.74 2.25 tax 3.24 to 2.75 6‡ tax to ‘3.74 3.25 7f tax to 4.24 3.75 8‡ tax 4.25 to 4.74 9‡ tax 5.24 4.75 to 10^5 tax 5.25 to 5.74 11‡ tax 6.24 5.75 to 12^ n tax to 6.74 6.25 13^ tax to 7.24 6.75 14^ tax to 7.74 7.25 15^ tax to 8.24 7.75 16^ tax to 8.74 8.25 17‡ to 9.24 8.75 18^ 9.74 9.25 19‡ to 10.24 9.75 20^ tax” additional l(f Each additional 50^ 773-774. 1139-1140, Senate Journal House Journal and-on adopted, committees was report conference reports the hill amended pursuant March the House of duly passed the conference committees was 19 votes negative with affirmative votes and 78 Representatives 1140-1141, and by and not House Journal voting, absent with 42 affirmative .votes negative votes Senate Journal voting. absent and Senate made in'Section change
Plaintiff contends that out by striking Chapter 341, Laws Act, Retail Sales'Tax inserting introduced and the section as paragraph the second the following: in lieu thereof retailers shall charge adopt tax to
“In adding tax: for application bracket the following No tax to $0.24 $0.01 1‡ .74 .25 2‡ tax” to 1.24 .'75 the Act and exclude except operation from operated from all receipts all sales and exempt gross In 24 cents from tax under said act.' short, and less the item in tax” contended that the bracket “$0.01 $0.24—No and all legislative evidences a intention such sales exempted excluded and receipts from such sales shall be^ *12 and tax operation imposed of the act from the thereunder. It that the im- specifically is further contended sales and laid the consumer and that if posed purchaser or sales for less than 25 cents and the thereof are gross proceeds subject tax and retailer then the law against sales enforced violative of the arbitrary, confiscatory and due discriminatory, of the process clause Constitution of the United States and Sec- 20 of the of North Dakota. tions and Constitution The first question presented is one intention. legislative Did the legislature by employed intend Section language 6 to that and provide sales sales for less receipts gross than 25 think exempt cents should be from the sales tax? We not. noted,
As has been the Retail period entire during Sales laws of state had been in since operation May Retail 1935, up to the enactment of the Sales Tax Act of 1949 of the tax had been controlled application computation a bracket which that no tax should be system provided added to the sales and' collected from the item price purchaser for which of 14 cents was purchase price paid. or'less .But this entire a two cent retail im- during period per sales was from all posed upon including sales sales receipts or Every cents less. tax commissioner had so construed and never law, enforced such construction had been chal- in the it lenged appeared courts. As has been said Section in the Tax Act 1935 and acts enacted by Retail Sales and the or bracket which had subsequent legislatures schedule put in force under the 1935act was continued in been force under subsequent acts. Under the 1949 Act as introduced it would necessary system adopt plan ap- have been some or for the plication purchase price of the tax to where the was so only part that two cent thereof small would be a fractional likely system of a cent and seems that the same bracket as has prevailed adopted. under former acts would have been Representatives Journals House and of the Senate disclose there was some with, dissatisfaction or at least de- change, whereby sire the former bracket taxa of one cent might purchase price charge be added to and included in a to ‡ change proposed on a sale for and that a was 65^5 purpose changing system made in 6 for Section the former by inserting in the section a schedule or bracket and also to change formerly pro- the bracket which had been utilized so as to vide that the retail should not be added to made charge where the amount of the charge purchase or less. The Senate, however, 24^ apparently retain desired to that had been in effect under the former laws and amended the bill so as to strike out provision that had been inserted Section 6 the House of Representatives provision in lieu thereof inserted which *13 part in the bill when it was was introduced and which had been Retail controversy of the former Sales Tax laws. The between the two houses was referred to a conference committee and such committee recommended that a schedule or bracket be inserted change in bill, the in which a was made in the lower brackets originally proposed by from what had been the House. many
It will be noted that sections Retail Sales Tax specific subject. Act prescribed dealt with one Thus,.Section 2 imposed. the amount the tax and on what the tax shall be specified exemptions 3 Section from the tax. 4 Section upon subsequent dealt payments with allowance of credit paid receipts the tax for repre- taxes that had been on provided sented accounts found be worthless, and also that apply gasoline, the act cigarettes,, should not to sales of or etc., product,-business occupation other or on which-the State 772 might impose special or thereafter a
North. Dakota then tax. agency might apply provided the. that a relief com- Section paid a refund sales receive for.taxes missioner poor needy. goods free distribution to the for used for might provided that amount that be Section upon gross receipts resulting imposed a from sale should be charge, price or such tax the sales and when added added “to price charge, part or shall he debt constitute shall paid, until or user to retailer and shall be recov- consumer from in debts.” erable at law the same manner as other The second employed paragraph 6 related to to be of Section methods for application adding tax to the and the of such sales or purchased. .charge property provision It under this was adopted or had been under the that the schedule bracket former provided purchase price that on where the laws and which sales or less that no be amounted to cents should collected and purchase price amounted to that on where cents tax be added to 65 cents a one-cent and included in the to price paragraph, charge. It was under which such sched- adopted, legislature that or bracket had been struck ule out fixing in lieu of which it inserted schedule or bracket might charge added to the sales rate which computed tax wholly at the rate two cent where the would re- parts in in fractional of a cent. either sult only change legislature that the It clear seems intended change made make in the law was in Section especially in the in first three items and first item in was applied computation or bracket to be schedule and. remaining schedule or of the tax. items collection precisely they in the left had been bracket were bracket adopted in succeed- in 1935 and had force been continued change legislature ing years. made a further It is true the leaving bracket for consideration the schedule or instead of approval organizations and the of retailers associations *14 formulated themselves lawmakers of commissioner applied agreed upon of in the collection to be the bracket This in the law. was doubtless the same the tax and included legislature de- which the had that schedule insure done applied computation proper be in the should to be termined clearly was intention on tax. There no of the sales collection legislature gross proceeds from sales of less of that exempted the retail tax. Sec- be (cid:127)than 25 cents should hereby imposed, beginning provided “there is tion 2 of the act ending day day July, June, the 30th 1949 and the first percent upon gross receipts from all of two a consisting goods, tangible personal property, wares, or except provided in this at .sold merchandise, act, otherwise of North Dakota to users.” retail in state consumers or Sec- specified exemptions; 4.provided tion 3 Section taxes receipts paid gross represented on accounts found be actually purposes may charged worthless and off for income tax upon subsequent payments tax; be credited and Section provided might apply agency relief for and a receive a imposed paid refund the amount of tax act and under.the goods poor it for used for free distribution to needy. “except provided The clause as otherwise Act” this every the same as had been included in act from 1935 and specificprovisions exemptions had reference to the in the for law and deductions. perplexing-
A somewhat arises situation where retail sales imposed personal property all on sales of and where the is so small that the tax or on sale proceeds only will amount fraction of a for, cent course, legal may there no employed unit paying tender that overpaying difficulty tax without To it. obviate this various paying methods of the tax have been devised. In some instances coupons adopted, tokens have been others schedule bracket as has been in force state has been adopted. If there no schedule or bracket in were this state plan possible other to make the collection of a sales' tax amount- ing only apparent annoying a fraction of a cent it is em- barrassing might Thus, situations arise. if there were no sched- plan ule or other in the State for the collection a sales amounting only a fraction aof cent and the law otherwise re-
774 purchased purchaser an the article for is, it and if as mained 24(5 to the sales would amount which the sales namely, of Under the law cent, .48 a cent. half of a less than “you 24(5 say, I for the article to which me the vendor could owe of tax, of amount the sales which cent, have .48 one added part purchase price. you 24 cents.” owe me So 48/100 pay you reply, .48 how I to but am “True, The vendee could remedy that the himself of a cent?” If the seller avails of pur- provides of tax from the amount to collect statute part amount of the sales chaser and adds the of such as 24(5 brings charge cent, to recover and .48 of action judgment he .48 of a cent, would not be rendered impracticable impossible to collect such would find jurisprudence of It a maxim of our minor fraction a cent. requires impossibilities.” 31- law never that “the NDEC (22). applica question computation The of a sales where the would in a tion of the tax rate individual transactions result Supreme fraction considered Court of Utah of a cent was Candy 90 Utah Commission, in F. Co. W. Jensen v. State in that 107 ALR The statute involved case 61 P2d every provided on retail which for a tax of two cent sale might, he from the but fit, if saw collect vendee the vendor (without collecting prohibited a tax an him from amount cent) parts regard in fractional excess of tax com prescribed. puted that the rates It was contended the statute at exempted involving parts all fractional from the tax of 50 rejected cents. court contention and held that 'the tax paid every exception being provided alike, sale no should be where the amount than statute was less involving than 50 cents where the con cents, more expressed even in was not in units of cents or sideration difficulty collecting Eeferring encountered dollars. of a of 1 cent the court from the vendee a tax fractional adopted people apparently “The had the common sense said, absorbing 1 cent the minor fraction of solution of vendor paying im- rate when the sales tax the vendee major part passed posed fraction a cent.” It will namely plaintiff complains, item which the be noted provides application schedule, item the the first *16 on of 24 no tax sháll be collected sales cents or less. the tax per for 24 at two to on cents cent would amount sales Taxes only a minor is, that to fraction cent cent, .48 a a and sales only provision in less are the sales to. which the for 24 cents or applies. tax shall' that no be collected On the schedule major the tax hand all where amounts to the other on sales permitted 1 cent be a is to collected. cent, of a Thus per in for 25 cents there is to allowed be collected a four cent tax. probable system
It that is no has will been devised that make possible pay percent it to the exact amount of a one or two necessary all In tax on to sales. order do so it would be to utilize coupon token some other means of that character in de- nominations low one a as as hundredths of cent. The result expensive process. be would an and cumbersome Even where are used that the tokens seems minimum denomination is one recognized dealing problem It mill. has been in with this may adopt practical system the lawmakers some means or to computation facilitate the and collection of the tax and that the purpose merely system adopted is not defeated because does permit imposed tax for a a minor fraction of a cent to upon particular and collected a in sale. Thus Morrow v. Henne- 182 Wash 47 P2d ford, a had been established supplement whereby purchase Retail Sales Act a purchaser required pay of five cents the a cent token 1/5 imposing percent which resulted tax of four instead of two percent provided. (This pre- the Retail as Tax Act Sales is cisely happens ap- what under the schedule or bracket for plication present tax in Retail Sales Tax Act of North purchases on Dakota claim was made that the ac- 25‡.) attempt purchaser an tion of commission was force the pay percent prescribed by a tax in excess of two the statute. In upholding the use tokens court said:
“The the tax commission schedule issued is for convenience pur- computing 5-cent it is true the tax.' While paid, necessity arises its use out cent token chase 1/5 n the case.” ALR it is 1488, 1489, “In 110 said: exempt sales which the tax does not
“Where statute it im result finds cent, be less than as a seller would purchaser, impracticable possible the tax from the to collect uniformity question whether the tax as to lacks arises requirements equality constitutional under to violate uniformity of taxation. In stores which laws of problem normally cents, becomes a are for 5 or serious cent, because the the usual tax.-rate of or legal purchaser no tender with which the small that there is so pay rightly tax, a full it, cent as since can and he refuses may by comparison greatly exceed the actual tax. Yet that sum *17 tax on all these transactions, if the bears the burden the seller steadily such, with the volume sales. The loss mounts his uniformly the tax notwith sustained sales courts, however, have standing objection, saying ‘breakdown’ schedules or pass the tax on to the other means the seller can consumer. Drugs App2d 1936, 720, 13 37 P2d Johnson, 1022; Roth v. Cal Candy 1936, v. Tax Commission, F. Jensen Co. State 90 W. 261; 61 107 ALR State Tax P2d Commission v. Utah Logan, 406, 54 1197.” P2d 1936, Utah 88 contention
Plaintiff’s next is-that “and the whole clearly unmistakably is of the thereof Section act upon imposed consumer;” if it and that is held indi- excepted” “entirely than “are.not vidual sales of less 25^ plaintiff tax then the is, from the sales effect, eliminated” compulsion specifically pay upon compelled “to a tax laid wholly plaintiff which unable collect the consumer and or consequently recoup” “portion and that such manner confiscatory arbitrary, discriminatory, and violative” the law is process of the United States of the due clause the Constitution of the Constitution State and Section and Section contemplates true the Betail Sales Act North Dakota. It is upon purchaser but tax shall laid that the burden of the be tax'upon purchaser legal impose the or not create does part pay obligation pro- on his the tax to the State. The act purchase price retailer that the shall add to- on each vides equal required amount will sale an which he he pay upon gross receipts against hut the tax not assessed purchaser. (Section 6) provides The act that “retailers shall average equivalent price tax or add the thereof to the sales charge, part or and when added -such shall constitute a price charge, or shall be a debt the consumer user paid, to the retailer until be at law in the shall recoverable manner other same as debt.” contemplates
While the.act
that the burden of the tax shall
imposed upon
purchaser,
obligation
the tax is
the.
upon
purchaser.
upon
laid
In Re
seller,
See,
Atlas
obligation
Co.,
Television
273 NY
The act hereby imposed, beginning day July, “There is the first ending day percent the 30th a tax June, 1951, of two gross receipts tangible personal property, from all sales of consisting of-goods, except wares, or merchandise, as otherwise *18 provided act, in in sold at retail the state of North Dakota users; to or consumers . Sec 2. . . day following
“On or before the twentieth of the month the period quarterly following- close the first as defined in the day section, and or on before the twentieth of the month follow- ing subsequent quarterly period each of three months, the re- preceding quarterly pe- tailer shall make aout return for the may prescribed by in riod form such and manner as the com- showing gross receipts missioner, retailer, of the the amount period of the tax for the covered and return, such further may require information as the commissioner enable him to correctly compute tax herein levied. . . collect the . to and 9. Sec provides: act further penalty any pay im- taxpayer a tax or liable
“Whenever including neglects amount, posed same, refuses together any with the penalty, tax, to such interest, or addition lien favor may in shall be thereto, addition in accrue costs rights property and all North Dakota of the state of taxpayer. belonging personal, said property, whether real or the tax becomes at time lien attach “The aforesaid shall liability payable for such shall continue until due and amount is satisfied. subsequent against preserve the lien
“In order to aforesaid judgment mortgages, purchasers, value creditors, county, any property in a of the situated lien, without notice register of of the deeds file with the the tax commissioner shall county property lien. notice said located, in which said is county prepare keep register of deeds of shall
“The each Liens,’ of Tax so ruled as to his office book known as ‘Index following appropriate data, show columns arranged alphabetically: taxpayers, names .taxpayer; 1. The name of claimant;
2. North The name ‘State Dakota’ as received; 3. Time notice lien was of notice; 4. Date due;
5. lien Amount of then
6. . When satisfied . . request attorney, general, upon the tax
“The commis- bring equity, may an action law in shall at facts sioner, justify, payment any taxes and without bond to enforce penalties, in such he shall have action assistance of attorney county pending. which action state’s . . .” Sec may appeal taxpayer be taken
“An the district court county principal place resides, in which he or in which his sixty days after he shall have re- located, within business
779' pro- from the notice commissioner'of his determination ceived as preceding for in the section; vided appeal
“The shall be taken written notice to the com- original and served as an missioner notice. said When notice' is served it shall be filed so with the return thereon in the of- fice clerk of court, of the said district and docketed other as taxpayer plaintiff with the cases, as and the commissioner as de- . .” 14.- fendant. . Sec provisions provide
. These of the Eetail Tax Sales Act against provision enforcement the retailer. No is by. made for enforcement the State of retail sales tax against purchaser. obligation purchaser of the for a upon the sale is not to the State but to the retailer obligation being and under the statute the comes into when the purchase price charge the tax amount of thereby added is purchaser becomes a debt to the retailer and obliga- as is enforceable such. While the retail sales tax an is tion of the retailer is nevertheless true that where the re- part purchase tailer the amount includes as a of the purchaser and collects the same from the aas purchase price at the time the sale made, statute contemplates apparent although it is done, should obligation purchaser tax is an the burden of the tax very upon imposed upon purchaser in a real sense laid completed moment the at the transaction is and hence it is not Strange imposed upon that it has been said that the tax is purchaser, placed upon because incidence the tax is purchaser at the time the sale is made and the retailer is at subsequently once imbursed for the retail tax- which he pay. must
Plaintiff contends, however, that this court has held that the
upon
only
retail
is a tax
the consumer
and not
support
In
retailer.
of this contention he cites: Jewel Tea
Gray,
v. Co. Tax
70 ND
Commissioner,
386;
293 NW Voss v.
ND
1;
Federal
727, NW
Land Bank v. Bismarck Lumber
Co.,
It true is the burden of the tax been said that it has these decisions imposed upon upon purchaser the that the tax is- also the laid is pointed the retail sales purchaser; out where has been and as by purchase price the retailer and collected to the added tax is thus the sales transaction-and as of the time and a part at the immediately purchaser placed upon the of the tax is incidence may year, each well be of transactions in millions is true as upon purchaser though imposed even the the tax that is said upon payment duty laid the and not the tax is seller the liability purchaser purchaser debt upon the of the is a liability for a In re a State. retailer and not holding- supra. no However, there is. Co., Television Atlas upon any a tax that the retail sales is cases cited in judgments only and the rendered two of consumer against the retailer. enforced cases plaintiff court cited do not hold of this The decisions only upon purchaser a tax or that is a retail sales that against obligation purchaser enforceable at an tax is such question presented not involved or was- or such Indeed, all. any cases. decided supra, Company Tax the re Commissioner, v. Tea
In Jewel purchasers tax from collect a sales failed to tailer price charge. consequently tax to the or not add such could against assessed sales taxes however, Commissioner, The together Company aggregating with Tea cer $5105.42 the Jewel Company applied statutory penalties. The Tea for Jewel tain provided by hearing the Retail the commissioner before Chapter 249, 12; Sec then in force. Laws Tax Act Sales 13). Chapter (Laws after Sec commissioner plaintiff tax with hearing for this “the is liable decided appealed Whereupon plaintiff to the district court penalty.” judgment was rendered order of the commissioner from against for the Company Tea the Jewel district court for addition taxes and the retail sales for sum $5105.42 in. statutory penalties. decision in that in the It true certain imposed the con- the tax as made to reference is case provision reference further made to "but sumer imposed that “retailers shall . . add the tax statute . -equivalent average act, thereof, or the the.
charge and when added such tax constitute shall (cid:127) charge, shall be debt consumer user to paid, retailer until and shall be recoverable at law in the same judgment- manner as other debts.” The decision in the liability Co. case Jewel Tea enforced' the the tax and the *21 obligation payment against to make thereof the retailer. No question presented respect was the case with to whether against against- purchaser. the tax was one the retailer or only question presented relating liability The of the plaintiff for the tax that was the contention the business trans- plaintiff acted between and the was State interstate commerce; sought imposed that the retail awas tax on inter- consequently commerce, state that the transaction ex- was empted provisions from of the Retail Sales Act under provides: 3 of the act which Section hereby specifically exempted provisions
“There are from the computation imposed Act and from of this the amount of tax by following: it,
“(a) gross receipts tangible personal from prop- sales of erty prohibited taxing which this State from under the Con- stitution or laws of the United States or under the Constitution of this State.” Gray, supra, v.
In pho Voss the Tax Commissioner ruled that by tographs patrons made photographs Voss- who sat for to- tangible personal be made on their order constituted a sale of property meaning within the of the Retail Sales Tax Act. The against an commissioner made assessment in the Voss sum of protested hearing. some $496.11. Voss and demanded a Such hearing protest was had. The commissioner denied and af Thereupon appeal fii’med assessment. Voss took an to pursuant Chapter district court the Laws Sec (Laws Chapter 14) provides tion 13 341,Section which appeal may taxpayer “an be taken to the District Court county of the in which he resides” from the the Com- decision of' the contentions court sustained The district missioner. appealed. This court plaintiff, The Tax Commissioner Voss. plain- judgment that the trial court and held reversed subject to the tax. tiff was Voss supra, the Co., Bismarck Lumber Federal Land Bank v.
In building Company material to the Federal certain sold Lumber buildings upon repairing that had lands Land Bank be used acquired by Lumber Bank. The Com- the Federal Land been pany tax to the salé of the retail the amount added prescribed Land Bank The Federal act. Section ground the tax added on the amount of refused to 3 of the Section of the United States under laws receipts from the sale of Act Eetail Sales Tax property exempt the retail Land Bank to the Federal the contention of the Lum- trial court tax. The sustained judgment against Company the Federal Land rendered ber so added to the the amount of the which had been Bank for appealed price. Bank court af- The Federal Land sale questions presented judgment. The sole involved firmed the *22 the to the Federal Land were, first, whether sale in that case receipts exempt such sales were from the the of Bank and Congress second, could and, whether constitution- retail sales ally activities of the Federal Land immunize State.taxation purchase repair buildings of material for of the Bank such as acquired by carrying the bank on its business in fur- on lands lending of the bank. The functions Federal of the therance controversy Supreme brought before the Bank the Court Land Land Bank on writ of certiorari. Federal of the United States L In et 314 US ed 65. its al, Bismarck Lumber Co. v. Supreme opinion the United case the Court of the States said: questions: with are confronted two First —Does “We #26 Act) (The within its ban state Federal Farm Loan include that it does. Second: Can sales this? hold We constitutionally Congress immunize from state taxation activ- lending land functions of federal in furtherance of the ities banks?” supra, the Commissioner,
In v. Standard Oil Co. State contended that the Federal Tax Commissioner excise taxes paid by gasoline purchaser that had'been of to the sales seller payment latter to the Federal Government constituted gross receipts part purview within Tax law. This court held that the Retail Sales amount of the paid so to the Federal not excise tax Government did constitute 'price gross receipts received seller. question It will be noted that in none the cases cited was imposed'upon whether the retail involved was purchaser anything might seller or have been said, opinions having any in the course reference authority to this would not constitute under the doctrine precedents. stare decisis
Corpus says: Juris Secundum authority precedent “The of a former decision aas must be points actually limited to decided on the facts before the p 380. court.” CJS judicial opinion
“It well
that a
settled
must be construed
with
language
reference to the facts on which it is
based,
referring
particular
used must be held as
case, and read-
light
in the
circumstances under which it is
and of
used,
”
questions presented.
the issues or
409-412.
CJS
judicial opinion
authority only
“A
actually
for what is
de
cided.”
v.
Rolfe,
Hewitt,
Admrx.
227 NY
“Nothing actually can be ‘stare decisis’ which .con- Brolasky’s sidered determined.” In re Pa Estate, A153
“Language opinion of an must be confined to the facts before opinion authority beyond court, point no is an ac tually Dougherty Equitable decided.” v. Life Assur. Soc. *23 S.,U. 266 NY 193 NE 71, 897. “ disregarded, general expres ‘It a maxim is not to be every opinion, sions, are to be taken in connection with the expressions beyond they go case which those are used. If they may respected, ought case, be not but control to judgment subsequent very point presented in a suit when the is Virginia, decision.’ v. 399, Cohens 6 5 L ed 264, 257, Wheat
78á
general
(Ogden
‘It
Chief
rule,’
290.
said
Justice Marshall
is
647)
positive
6 L ed
333,
12
. . . ‘that the
v.
Wheat
Saunders,
only
,
authority-
with
a decision is co-extensive
the facts on
of
”
Mortgage Corp.
it
Farm
Falk,
made.’
Federal
v.
which
155,
ND
“The say argument may happen cause, to in a discursive of a court regard only points adjudi- to causes, even but has several actually questions elements in the involved as essential cations controversy.” Ingham Harper Son, v. & in actual 71 Wash 128P 675. expressions opinion permitted in a
Isolated former cannot be express language being ,to override the the act construed. In 121 277 Pa A 35. re Frick’s Estate, (cid:127) opinion employed expressions in an are not to Isolated be plain import expand opinion holding than more its into interpreted deciding questions not essential .to the determina as People ex rel. Yohnka v. tion of the issues before the court. Kennedy, Ill NE2d application noted for the
As has- been a bracket adopted in 1935 tax was which recited “$0.01 $0.14— sales change for tax.” bracket remained in without No This force years Tax the 1949 Retail Act more than fourteen until Sales During bracket was construed took effect. all this time such applicable only by and that the sales Tax Commissioner as the re- or less tenn tax” meant that on cents “No sales pur- price per cent of sales to- tailer should not add two exempting- price. At no time construed as chase prescribed 2 of from the section cents less during all the Retail short, In such time Sales the-act. receipts per two cent was measured tangible specified property while the in section of the act as stating system adopted provision section 6 in the bracket was con- $0.14 in which the sales was $0.01- required meaning purchaser should that the strued as of the sales two cent to the retailer during transpired price. apparent It what
785 passage of 1949 Retail Sales Tax Act that course legislators were mind it was unfair that some purchaser a where the 15 cents the on sale sales was should required price. purchase to have added to 1 cent be as per to an addition of would more than six cent of the amount required pay price, only the retailer would whereas receipts. per gross leg- cent on the clear that the two It seems merely intention to insert new islative a bracket as the law and increase the amount of the sales might which the tax not be added retailer from 14 cents 24 cents and otherwise law remain as it had would operation applied previous during years. been plaintiff if contends, however, that statute is con- requiring per the retailer to strued two cent on receipts receipts including from all sales of 24 permitted cents and less on which the retailer not collect .price purchase two cent of add the same to the price at the time the statute sale, is violative of 11 Section provides, Constitution of this state which “All laws- of general operation;” nature shall have a uniform and of Sec- provides, 20 tion of the State Constitution which “Nor shall granted privileges citizen or class citizens be or immunities granted which the same tennis shall not be to all citizens;” of Fourteenth Amendment Constitution United States.
Plaintiff’s well contention is not founded. The statute does uniform, operation. applies uniformly generally have It throughout operates similarly upon persons the State and all similarly equally similarly situated All affected. who are similarly seq; p are situated 59 treated. CJ Sec et Gunn Minneapolis, St. Railway v. Paul & Sault Marie Co., Ste. ND 318, 158 Sears, NW In Nelson v. & Co., Roebuck L 359, 363, ed US said: Court passing constitutionality “In on the a tax ‘we are law only practical operation, concerned with its definition its *25 applied may descriptive precise which words form of to it.” do not nor does 20 Constitution 11 of State
Sections of the United Amendment to the the Fourteenth Constitution prevent provided prohibit clas- classification such States legislation, purpose of is for the is reasonable sification considering justifiable proper distinctions based arbitrary, clearly purpose not a sub- of not is law, is op- terfuge toor class or to burden another to shield one' p unlawfully press 722; in its administration. CJ Sec legis- pp 140-142. -The Law, Sec Jur, Am Constitutional question placed the sales in sales where lature the bracket separate provided price in a classification and 24 cents or less is per two cent retailer not add a tax of on such sales the shall upon price. to which such bracket The tax the sales to there a rea- applies a cent and was would be a minor fraction of legislature. classifying did for basis sonable providing a should not a a minor fraction of cent tax of against purchase and made a debt be added purchaser. object within an reasonable relation to there “Where is legislative authority, discretion governmental the exercise of the scope judicial inquiry judicial subject The review. is not question power deciding- confused with the is not to be in dealing legislative with the matter in scope considerations unwise, wise or policy. whether the enactment Whether theory, is the whether it best on sound economic it is based leg- short, result, whether, the desired means achieve prescribed limits should be exer- its within islative discretion judgment particular for the are matters manner, cised in opinion legislature, serious does the earnest conflict of range judicial cognizance bring them within not sufficeto legislature, being is, conditions, local familiar with . The . . . necessity primarily, judge The enactments. of such may legislature in its views differ with the mere fact that court judges may public policy, with inconsistent or that hold views legislation, propriety question, ground affords no judicial question interference, unmistakably unless the act in legislative palpably power. Chicago, excess . . .and v. Q. McQuire, & R. Co. L B. US 55 ed 337, 31 S Ct According plaintiff’s complaint the tax commissioner re- quired plaintiff pay tax of two cent its re- ceipts including gross receipts from all sales from sales where the sale was cents less. The tax commis- right doing. plaintiff was in so sioner This was what the required provisions under the of the Retail Sales Act. complaint does state facts sufficientto constitute a-cause *26 against of action the defendant and the trial court was correct in sustaining the demurrer. appealed
The order from is affirmed. J., Dist. concurs.
Miller, (concurring specially) J. I concur in the conclusion Burke, liability that the the measure' of retailer’s to the state, under provisions Chapter (Sales the of 341, Laws of ND -1949 Act) per gross' exemptions spe- cent of two his sales, less the cifically Accordingly, set forth in the act. I concur the' af- firmance syllabus of the order of the District Court and the prepared by this Court.
I opinion am also of the that the former decisions of this (Jewel Court Tea Co. v. Tax Commissioner, ND 229, 70 293 Gray, NW 386; Voss v. 70 ND 727, NW 1; State, Isakson v. 70 ND 505, 192; 296 NW and Federal Land Bank v. Bismarck Co., Lumber 70 ND 607, 1105, NW Ct S US 1518) holding 85 L ed (Chapter that the sales tax, 276 Laws subsequent of thereof) 1935 and primarily reenactments a upon correctly the consumer were dfefcided. legislature levy When upon decided, upon retail purchaser sales and to make that tax taxa at such sales, was confronted with a serious administrativé problem. Obviously, attempt directly an collect the purchaser upon purchases each the total of cumulative his would administratively impossible. inefficient wasteful, if not efficiency legislature made administrative the interest
In purchasers duty tax from the collect the the sellers to it the required upon state, remit to the sellers each sale In the amount of the tax collected. intervals, the' stated at making simplicity purpose the burden for the interest of light possible upon bookkeeping sellers, as of additional liability provided sellers’ legislature that the measure of their sales. cent be two should among things, provided, other of the 1935 Act Section 6 adoption completing “Agreements retailers, or between by organizations regulations of retailers appropriate rules and average adding provide tax or the methods for uniform approval equivalent first have . which shall thereof, . . expressly authorized.” Commissioner, are authorization retailers met to this and with Pursuant agreed approval the Tax to uniform method Commissioner equivalent average upon adding or the thereof the tax each system agreed The method to was a bracket sale. retail charging Under this the lowést sale taxed was the tax. fifteen which a tax of one in the amount of cents sale charged. An additional of one cent was to be to be cent was fifty increase in cents- above for each added *27 time 1935 Act Prom the the of fifteen cents. went amount base until'July May 1, 1949, the administrative on effect into subsequent interpretation 1935 Act the and the enactments of duty the of that was retailers collect the thereof, been has according ap- purchasers sales, retail at to the the tax liability of that the measure proved retailers’ schedule gross per two cent their sales. tax was. of Such for the collected holdings interpretation with of this court consistent an purchaser. seeming The a tax the tax levied was on saying collecting agent liable, paradox that the exists in gross per sales, collects, for two cent his not for what he but. substantially equal other. to each Cer- two are if the vanishes tainly legislative that the 1947 intended acts from the' upon substantially conferred same, two be should approval Commissioner, right, of the Tax with retailers adopt Presump- which would secure methods that result. adopted tively fully did the method secure which, results at least, recompensed the for in far I retailer, so as know there were no during period complaints they from retailers the schedule agreed in force. was to, legislature incorporated however, the
In into the re- of the sales its own schedule of the enactment amount of n might purchaser. the retailer which collect from the Under might sale a minimum which one this schedule cent twenty-five charged was a sale in the amount of An cents. fifty one cent was allowed for each additional in- cents twenty-five sale above the crease in base cents. parts cognate the 1949 All other Act are identical with prior sections of sales tax acts. nothing legislative
There is the 1949 Act which indicates change liability intent to the measure retailers’ Presumptively legislature state. was aware that the admin- interpretation prior interpretation istrative an acts, of four- years liability duration, teen thht of the .retailer was light two cent of the sales. In the of this circumstance change I do not see how an intent to the measure of a retailer’s liability adoption can he inferred from the schedule that might permit not in some instances the retailer to collect the may full amount which he must to the state. It he that in such case the tax levied is in a tax the retailer, hut legislature power is, if it it is one which it was within the levy. Judge say G-rimsonhas authorized me that he concurs expressed opinion. the views in this (dissenting) plaintiff brings
Morris, C. J. this action to paid by recover protest $1,486.96 sum of it under as sales provisions taxes Chapter exacted under the Laws Session *28 (Chapter Supp ND 1949 1943). 57-39,1949 In RCND its com- plaint plaintiff alleges engaged the that it sale is in the of mer- qual- chandise in six cities the State of North and Dakota has obtaining by provisions law for tax of the sales ified under permits retailer. business to transact of its stores each alleges: plaintiff then provisions law, said sales of “That terms and under the by provided plaintiff, law, manner in the referred to, above fhe defendant Commissioner, made and returned to the Tax including July period up to and 1, 1949 for from herein, report day September, all correct of and 1949, of a true 30th dur- in this state stores of sold at its various merchandise pay ing period, defendant to said at the same time and did said sales where individual amount tax collected on the total twenty-four cents. exceeded sum the amount involved Chapter provisions of said “That under the and terms year Dakota for of North Laws of the Session State permitted from the a tax to collect consumer no retailer is paid for the amount where on individual sales merchandise twenty-five retailer and no cents, than such merchandise is less payment North to the State of liable for the of merchandise is twenty- any than on individual sales less Dakota of five cents. plaintiff provisions law
“That under the of said was terms any permitted purchaser not or con- and did collect twenty-five than tax on individual of.less cents. sumer despite plaintiff, provisions law, said That, terms payment the full un- at the time of amount-of collected provisions- re- law, der and quired accordance with said was by $1486.96, additional the .defendant to sum of necessary being the amount claimed the Tax Commissioner as equal in order to two cent all on sales within State during period including of North Dakota said the individual twenty-five than sales of less cents.- provisions specific plain terms “That under Chapter no Laws 341 of the Session said twenty-five cents, than individual sales of-less due aof tax on such sales from the the defendant collection greater tax from the retailer in fact the collection retailer, or lawfully permitted to collect under said law than such retailer
'791 illegal, purchaser invalid, unreasonable, or consumer is the plaintiff, contrary rights discriminatory, wholly to the the owing the tax due and under the reason that said unlawful for only solely against against and not consumer law is a the retailer. plaintiff operated by at each
“That this store owned kept an of North Dakota acurate and correct State record permitted tax which under said law it was of all sales to and alleged, and, did collect as hereinbefore remitted to the defend- amount of tax so ant full collected. plaintiff during period wholly
“That this said was unable un- system der the bracket contained in so-called said law, collect portion recoup excess tax in amount compelled by pay $1486.96, which it was the defendant to protest.” and did complaint ground
The defendant to the demurred on the it did not state facts sufficient constitute cause of action. The district court sustained the demurrer, and from an order sustaining plaintiff appeals demurrer, to this court. originally
The sales tax law was enacted in this state as Chapter substantially 276, 1935, in Session Laws the same form appears, exception in which it now with of Section 6 of the 1949 specifying act, which was inserted bracket charged detail the tax to be the consumer. (Chapter
The 1937Sales Tax
1937)
Act
249,Session Laws
impose
upon
held
upon
court to
tax the consumer and not
though
required
retailer, even
the retailer is
to add the
average equivalent
price,
its
collect
and remit
same
commissioner. Jewel Tea Co. v.
State
70
Commissioner,
229,
ND
386;
NW
Voss v.
Gray, 70 ND
727,
1; Isakson v. State,
NW
70 ND 505, 296
192; NW
Federal Land Bank v. Bismarck
Co.,
Lumber
607,
ND
42,
Section 1943) Supp follows: reads as to BOND 1949 3902, July, day hereby imposed, beginning the first “There is day ending percent two June, a tax of the 30th and tangible personal gross receipts prop- upon from all sales of except consisting goods, erty, wares, or other- merchandise, as provided at retail in the state of North act, in this sold wise upon gross like users; or a rate of tax Dakota consumers furnishing gas, receipts service of sales, from the or .steam, including gross electricity, service, and communication water by any municipal corporation receipts from such sales furnish- electricity, ing gas, water communication service to steam, capacity, except pro- proprietary public as otherwise in its in act, in when at retail the state of North Dakota this sold vided tax users; a like rate of or consumers places receipts or all tickets admissions playing and the a and athletic events record on amusement response except vending placed machine, in in slot, to a coin provided in otherwise act. The herein levied shall this as computed provided.” collected as hereinafter Chapter 276, with Section Session identical This section portion. except That the italicized the dates and for Laws Chapter N. D. portion 308, Session Laws in added Section subsequent law. of the sales enactments in 1945 and retained provided: Chapter 276, N. Laws D. Session Section imposed practicable, far shall, as add “Retailers average equivalent to .the sales thereof, act, or under price charge when added shall constitute or such charge, shall debt from consumer user be a of such paid, at law the until and shall be recoverable same retailer other debts. manner as
“Agreements competing adoption' retailers,- between or the regulations by organizations appropriate associa- rules provide adding tions of retailers uniform methods equivalent average or the do thereof, tax price fixing agreements and which not involve unlawful, and which
otherwise shall approval expressly first have the are au- Commissioner, thorized and shall be held not to be in violation of anti-trust laws of this state.” provision, substantially language, appears
This same all reenactments of sales tax law until 1949. Section 6 of *31 Chapter provides: Session Laws N. D. imposed
“Retailers shall add the tax act, under this or the average equivalent price charge thereof, to the sales and when charge, added such taxes shall constitute a such be a paid, shall debt from the consumer or user to retailer until and shall be recoverable at law the same manner as other debts. adding charge,
“In tax to adopt the retailers shall following system application the bracket for the the tax: to
$0.01 no $00.24 ........................ tax .25 to .74 tax ............................ l^S 2‡ .75 to 1.24 . ..'......................... 20‡ 9.75 to 10.24 . . .'.........................
Each additional 50‡
1‡
..............
additional tax”
by demurring
complaint,
to the
defendant,
The
admits the
pleaded.
relevant material
well
truth
all issuable
facts
Stern
allegations
complaint
Gray,
ND
419. The
of a
v.
NW
liberally
Security
by
are to be
attacked
demurrer
construed.
Applying
Bank
49 ND
It *32 plain- language the of the the amount of the statute subject nonexempt tax, are to the sales includ- retail sales tiff’s twenty-four ing that the insertion cents, of one cent to items an intention in on of the bracket the statute indicates part legislature replace own method for the to with its the adding average equivalent it the method which tax, the of the ap- formerly permitted with the had the formulate retailers to proval of the tax commissioner. ambiguous some sections statute are the
Portions seemingly here the issues Under it are inconsistent with others. presented duty it doing is onr to statute, construe the and in so,- possible, if to avoid, construction that would render the statute constitutionality validity. of doubtful duty to
“it
of courts
reconcile
with the
is
statutes
constitu
doing
tion when that can be done
to
without
violence
the lan
.
guage
Tyler,
Martin v.
4 ND
either,”
I start with the that the tax is lev- upon the ied consumer. required plaintiff to collect the tax
“What to do is employees duty It in the it is to remit. has state whose collect them, goods requires price delivered. The state to collecting It will be that assist in revenue. noted our statute imposes upon goods sold, be collected with the to payment purchase price, and this becomes debt ‘a paid, or consumer user to retailer until and shall be recoverable (Sec. 6.) at law the same manner as debts.’ The retailer other average equivalent charge. the tax must add or its or pays' provisions It is the consumer tax, who and under the any of Sec. it is made ‘unlawful for retailer advertise or public hold directly out state to the or to consumer, indirectly, any part imposed by that the tax or thereof Act this will be assumed or absorbed the retailer or it that will not an considered as element in the consumer, or if any it added, thereof will be refunded.’ sight pri- “We must not lose the fact that this tax is laid marily plaintiff consumer. fact failed duty.' collect this tax state does not absolve from its There no discrimination between nonresident and resident place so as to an retailers unshared burden on former. The only buy state; is laid on those who within the but order to insure collection of tax, resort is had the records of the retailer. To obviate manifest difficulties assessment and gross receipts collection, the of- retailer are made basis to; (Sec. 2) (Sec. price. 6.) adds the tax and he his cost To (cid:127) liability assure him that the will not fall he him, cannot *33 competition compelled pressure other or method to (Section quoted permitted to do He is not so.. the tax. absorb above.)” Tea v. State 70 ND Commissioner, Jewel Co. 386. 293NW 229, Gray, involving tax, the v. 70 ND
In next case the Voss quoting portion a after the 1937 727, 1, act, 298 NW the majority of court said: provisions reciting enough act further the it is
“Without imposed say tax the that the thus is a tax on consumer.” now to dissenting opinion, Judge in his Christianson And said: imposes upon pur- Act of- “The Sales Tax this state the duty consumer, chaser or and makes it seller add price charge or the amount of the tax to the sales and to collect the tax to tax commissioner. Jewel v. and remit Tea Co. may ante, Tax Comr. 386. The retailer not State NW pay required to the tax tax, or but is add or assume equivalent its charge, or the tax so added charge. It unlawful for constitutes directly retailer to rectly or to hold out or state or indi- any part that he will thereof, absorb the or make any part a refund the tax.” language statutory referred to has been carried into the
The it did then. Great North- present means same now as It act. County, Ry. 54 ND NW 768; Gimble v. Ward ern Co. 581, 44 198. Co., Utilities ante NW2d v. Montana-Dakota of a it is to statute, construction be assumed aid in the an “As acquainted legislature presumed with, and had that the judicial former sub- statutes construction mind, judicial light ject, was enacted that the statute prior or in the had received, enactment construction bearing* judicial existing light a direct as have decisions of such Page upon Jur, Statutes, Section it.” 50 Am clearly spoken the effect that the sales has This court thereby leaving retailer, on the on the levied consumer hybrid tax it is no alternative construction room an syllabi appear strongest expressions levied both. *34 797 syllabus by paragraph 2 in tbe court. In of the Jewel Tea Oo. supra, Commissioner, Tax we State said: v.
“Chapter 249 the 1937, known as the Session Laws ‘Sales imposes upon Tax the tax the in this Act,’ state, consumer upon though required the retailer, not even the retailer is add to average equivalent, price charge, tax, the its or or to the sales to and to collect the same and remit the tax the commis- sioner.” syllabus paragraph
In of1 the in Federal Land Bank Bis- v. Co., marck Lumber 70 ND we 607, 42, 297 NW said: imposed by (Sess “The tax the State Sáles Tax Act Laws chap 249) upon buyer upon 1937, is laid the and not the seller.” emphasized correctness in these statements is the dis- opinion senting Judge Christianson in Federal Land Bank v. Bismarck Lumber Co., wherein he said: imposed upon
“The state
not a tax
is
the retailer for
privilege
engaging
privilege
the
in
for
or
the
business
making
lays
the sale. The
law
the burden
the tax
purchaser.
Jewel Tea Co. v.
Tax
State
Commissioner, ante,
places upon
duty
229,
“The state sales an enforced contribution exacted taxing power provide State the exercise of its to support government. pp It substantial, CJ is a imposed upon purchaser per- direct and discernible tax property, required sonal which the seller is collect from the purchaser over to State Commissioner.”
n provides now that: which In addition Section 7
(cid:127) public state or hold out or “No retailer shall advertise any indirectly, directly that the tax or consumer, imposed by assumed or absorbed this act shall be thereof element that it not be considered as an the retailer or will any part if it or thereof consumer, added, be refunded.” will act) meaning
(which with Section identical *35 the inten- it was not that indicate that there other sections are require legislature absorb retailer to assume or tion of the to required only pay that he he the tax tax, that should but the consumer. to collect primarily But to definitions. the act devoted is
Section provisions adhere that an intention to indicate there are some strictly and to of the from the-consumer the'collection to bearing any portion burden, retailer from exclude the of. remittance. defi- that incident to collection and The than other receipts gross provides: nition of for taken shall
“discounts allowed and on sales purposes price by property included, be nor shall the sale returned not n when the is either full sale thereof refunded customers byor credit.” in cash provided payment
It that where is further sale is period longer sixty days, than over a the retailer re- extended is upon quired only to remit the sales tax during the actual cash received quarterly period. by him each may purports impose
It be noted also that Section which imposition by qualifies “except tax, the statement provided by act” otherwise the further statement computed herein that “The tax levied shall be collected as provided.” hereinafter paid receipts .repre-
In find Section 4 we that “Taxes actually charged be accounts found to worthless sented may subsequent purposes be off, income credited payment provided;” we have the tax herein Section which only quoted or absorb above, not forbids retailer assume provides he be tax, if he does Section “shall so, but
n guilty punishment a misdemeanor, for which shall he a fine imprisonment one not more than thousand dollars or for not year, imprisonment, more than one or both such fine and in the clearly discretion court. . . The tenor of these sections indicates that the retailer must collect and but remit, not pocket. tax out his own controversy
The heart of this failure of collections made system pursuant produce schedule, to the bracket an amount equal gross nonexempt two cent of the sales made plaintiff. prior per Under our tax statutes, Section voluntary adopted, by mitted schedule the retailers, n subject approval of the tax commissioner. The 1949 act an contains inflexible schedule. This schedule' must be consid portions par ered connection with the other of the act, and ticularly paragraph with first of Section 6 of which the part. paragraph requires schedule .a This retailers to add equivalent” “average price. tax or the tax to the sale adoption of the bracket does denote an intention on legislature any part to shift of the tax-burden from the consumer to the .retailer, but rather to fix a schedule *36 judgment would in its that cause the consumer to a tax of per aggregate nonexempt in the two cent on all sales. In this pleaded complaint, the application facts as in the case, the produce of the schedule has failed to that intended result and the are per $1,486.96 collections less than the desired two cent. discrepancy But this between the intended and the actual result taxpayer require not create new does the retailer to make up the difference from his own funds. It is clear that our statute levy separate does not taxes the on consumer and the retailer, Wyoming as did the statute under Walgreen consideration in Equalization, Wyo Co. v. State Board of 288, 166 Pac2d equivalent which levied a per sales tax of of two cent amounting twenty-five paid by cents or over to be per twenty-four consumer and a tax of one cent on sales of cents purchaser required or less which pay, was not but which paid by was assumed and the retailer. Neither is ours an exer privilege operating cise tax on the a retail mercantile busi as Drugs ness, was California tax considered in Roth v. App2d Johnson, Cal 720, 57 Pac2d 1022.
Under our statute the retailer is made the medium of collec- tion and nonexempt not the source of the tax. It all covers tangible personal property. exemptions Various are forth set in the act in providing sections other than the one for the bracket system. They upon are based the nature of the transaction, the property buyer kind of involved, or the classification of the suggested exemption It seller. that the 1949 act extends twenty-four cents or less because first item of the governing bracket schedule the collection of the tax from provides the consumer no shall collected on those clearly sales. But schedule not intended as a statement levy exemption. monetary system The units of our not do possible exactly make collection of a tax consumer of only per .monetary cent on all If two sales. units are to be with reference to amounts, used small the choice must be made collecting up per from the consumer between an exaction to 100 making no collection at all. To cent avoid both horns of this legislature substantially dilemma, the devised the inexact but just collecting equivalent.” “average purpose method of The average process an in the to reach device was collection of this generally bring bear consumer would a tax of “average equivalent” per In former acts the left cent. two retailers the tax determination commissioner. equivalent” “average statutory to a 1949 act reduced judgment legislature, pro- which, would schedule equivalent average of two cent of the duce on the nonexempt twenty-four one sales. Sales from cent to cents were excepted They schedule, in the from it. included are a “average equivalent” for the determined of the basis exemption legislature and not an from the the other tax. On *37 adoption imposes it that hand, cannot be said of the schedule liability any deficiency resulting from the on retailer for application, produce the actual of the of the schedule to failure equivalent gross per non- and exact of two of the retailers cent exempt I reconcile sales. consider the entire act and When
801 provisions, that the conclusion give I reach various effect to its bracket, belongs system to the under the collected all of the tax gross, per though cent the retailers two it exceeds state, even only act- retailer,- collected sales, taxable belongs compliance ing and must to state law, in with full the tax commissioner. be remitted to in in form and tax, both “The ultimate burden substance* tangible per consumption, buyer, thus laid
is Only price. property, in event the sales and measured sonal city pay. tax collected or- to the that the seller fails to over charge requires, is the burden cast the statute collect as 309 Co., Min. US on him.” McGoldrick v. Berwind-White Coal ALR 33, 565, 388, 84 L Ed 60 128 S Ct buttressed-by
My respect fact in is further conclusion this require the retailer that a construction of the which would act pocket pay the tax own the difference between out his according he allowed to collect from the consumer per schedule two cent of the taxable bracket -under, compel pleaded com him, sales would facts as plaint, to the consumers and'would result constitutionality of the statute. doubt as to See Winslow- Spacarb Evatt, 471, Inc. v. 144 59 National 924; Ohio St NE2d Storage Express 11 Co., Ice and Cold Co. v. Pacific Fruit Cal2d Pac2d 380. 283,79 my question of the statute is the
Inherent in construction proof. general rule that tax It is statutes are- the burden of strictly against government favor of’ construed most Gray, Goldberg 297 124. On the the citizen. v. ND NW 663, exempt property from taxation will laws which hand, other against In the claimant. re receive a strict construction Engstad 797; ND v. Estate, 545, NW2d Grand McKee’s Bridge County, American v. 577; 10 ND 84 NW Co. Forks ALR 798 and annotation. 352 Mo Smith, SW2d levy purpose a tax of act consideration .is to nonexempt tangible personal property two cent order, facilitate the the consumer. In collected from required report to» retailer his collection, .taxable *38 prima per is, and two cent of amount the tax commissioner bracket schedule The he has collected. facie, sum .the pay legislature judgment represents as to consumer “average yield of an that amount on basis that will ments plaintiff alleges application equivalent.” The per (the plaintiff) produced the full two cent. It has not schedule per taxpayer cent its taxable excess of two is not exemption. is not an But schedule sales over collections presented analogous a tax to that the situation is somewhat liability exemption presumptive two A retailer’s claim. liability actu If that his his taxable sales. he claims cent of ally proving amount, than the burden of less he has liability Mathe to the extent of a amount. lesser substantial requirement uniformity. not a Blauaer’s, matical exactness is Philadelphia, 330 Pa Atl 889. The law disre 340, 198 Inc. v. gards Zahl, ND 549;
trifles. Baird NW Robert v. 43 Minn Ass’n, 668; v. Land NW Western Land Western 41 Minn McComber, v. 42 NW Ass’n complaint go a cause states of action the case should the district trial on the court merits. back [File 7219] No. corporation, NORTHERN RAILWAY COMPANY,
GREAT Appellant, v. C. W. Ben C. Larkin McDONNELL, ElmerCart as members of the Public Service Commission Highway Jones, N. O. State Commissioner of the State of Respondents. Dakota, North
(45 721) NW2d