140 S.W.2d 420 | Ark. | 1940
Questions for decision are: (1) Was the method by which the General Assembly of 1939 undertook to continue in force the Arkansas Retail Sales Tax Law violative of 23, art. 5, of the constitution?1 (2) Did appellant purchase the merchandise for sale at retail and become liable under 9 of act 154 of 1937 through failure to collect the tax required to be paid by the consumer?
Appellant is an Arkansas corporation dealing in mill supplies, selling at wholesale and retail. When the commissioner of revenues presented a tax bill of $2,865.73 in addition to amounts declared and paid by appellant, injunctive relief was sought. This appeal is from the court's action in sustaining a demurrer to the complaint.
Plaintiff alleged that prior to notice of the contested assessment it had fully reported all taxes collected by it under mandates of the Sales Tax Act of 1937; that the claimed deficiency represents 2 per cent. of the price *525 of merchandise shipped in interstate commerce; that all sales involved were upon orders placed with it by the purchaser who specified what items were desired, and that in each instance the requirement was for merchandise not carried in stock, in consequence of which the order was directed to dealer or manufacturer in another state. The nonresident manufacturer or dealer charged appellant with the amount involved, and appellant, in turn, billed its customer within the state and collected therefor.
In urging that the general assembly's method of extending the sales tax was unconstitutional, appellant's position is this: Section 24 of act 154 of 1937 declared the state's right to collect the tax should expire July 1, 1939.
Nothing could be clearer than the intent of the general assembly to extend indefinitely the sales tax law as enacted in 1937. The means to that end constituted a short cut to the objective, but the constitution does not prohibit the repeal of a section of a statute. It does provide that no law shall be revived, amended, or the provisions thereof extended or conferred by reference to its title only, and directs that so much of the law as it is sought to revive, amend, extend, or confer shall be reenacted and published at length. Act 364 makes no reference to the title of act 154. When act 364 was approved March 16, 1939, act 154 was still in effect. Therefore, it was not "revived." Nothing was "conferred" by reference; nor was the 1937 enactment "extended" within the meaning of the constitution. The term "extended," as used in 23 of art. 5 of the constitution has reference to an attempt by the law-making body (a) to add something to the text of a pre-existing law, or (b) to impose conditions upon another statute. *526
In White v. Loughborough,
In Taylor v. J.A. Riggs Tractor Company2 the language used by Chief Justice Cockrill in Scales v. State,
When the section of act 154 limiting the life of the sales tax to July 1, 1939, was repealed, the general assembly was not acting without purpose. This is clearly indicated by the emergency clause, which says: "Said act now furnishes funds essential for education, relief, and general welfare of the people of the state of Arkansas, [and] it is imperative that said law remain in effect."
We hold that 24 of act 154 was repealed, and that the remainder of the act was not impaired. *527
Nor (in view of decisions of the Supreme Court of the United States) do we think the sales made by appellant were transactions in interstate commerce. McGoldrick, Comptroller of the City of New York v. Berwind-White Coal Mining Company,
That appellant in the case before us did not carry certain articles of merchandise or machinery in stock and ordered from distributors or manufacturers in other states, with directions that shipments be made to its customers, does not relieve the transactions of their essential intrastate characteristics. The contracts of purchase were made in this state. In each case appellant's undertaking was to supply the merchandise and the customer's obligation was to pay appellant. The transaction was consummated in Arkansas. The point from which shipment was made was merely incidental, and of no concern to appellant's customer. The customer was not obligated to the nonresident shipper. Appellant profited to the extent of the difference between the price charged it and the price it in turn charged the customer.
Assuming there was no intent to defeat payment of the tax, and that only merchandise not carried in stock by appellant was ordered shipped direct to the customer-consumer, it is obvious that if responsibility for collecting sales tax may be evaded by ordering goods shipped directly to the customer from another state, hundreds of thousands of dollars in tax funds may be lost by the simple process of accepting orders and directing shipments from points without the state.
It is insisted that, if the act be held valid, and if the transactions are not classified as interstate and *528
therefore not taxable, 13899 of Pope's Digest5 precludes collection of the tax for prior years. That the sales tax is an excise was decided in Wiseman v. Phillips,
If the tax was collectible from appellant on the transactions involved (and we hold that it was), it was appellant's duty to report these sales to the commissioner of revenues. That settlements were made from month to month without mention of the items now in controversy is a reasonable inference to be drawn from the circumstances. If this is true, and there was no disclosure by appellant, the state is not estopped to collect on the undisclosed sales.
The complaint, however, alleges that from time to time audits of appellant's business were made by state agents. If in consequence of such audits appellant made an assessment of the items in question, but did not pay the tax because of the commissioner's ruling that it was not to be included in the declarations, then, under authority of the New York Life insurance Company Case, supra, and Superior Bath House Co. v. McCarroll, Commissioner,6 (the tax for disclosed and reported periods would not be assessable.
Since the 1939 tax alone is involved in this appeal, and allegations of the complaint relating to prior transactions were not determinable in the claim appellant undertook to circumvent by injunction, the demurrer was properly sustained. If, however, the commissioner should seek to collect taxes alleged to be due on transactions consummated in former years, a question of fact might arise in respect of disclosures in the report or audit.
Affirmed.