67 Md. 290 | Md. | 1887
Lead Opinion
delivered the opinion of the Court.
This suit is brought to recover the tax assessed by the Act of 1814, chap. 483, which in sec. 85, provides:
“The president or other proper officer of any Savings Bank, institution or corporation which shall receive deposits and allow interest thereon, shall furnish to the Comptroller on or before the first day of July in each year, the aggregate amount of deposits in such corporation ; and shall pay to the Treasurer on or before the first day of January succeeding, out of the interest due to the depositors, the State tax on said deposits.”
The question is whether the deposits of the appellee invested in ground rents, reserved under leases of ninety-nine years renewable forever, on property, which, by the law of this State is assessed to, and the taxes thereon paid by, the leasehold owner, are within the operation of this Act. The contention is that the tax thereby imposed is in effect a tax on property held by the appellee in trust for its depositors, and to hold that the deposits invested in ground rents are liable to the payment of this tax, would he to subject the same property to double taxation, which is forbidden by the State Constitution. And in view of the decision in State vs. Sterling, 20 Md., 502, this contention is, we think, well founded. The pre
Nor do-we see the force of the argument that in directing the tax to be paid out of the interest, due to depositors, it thereby becomes a tax on property. Savings Banks are not Banks of discount, nor have they any capital stock. The interest, therefore, due the depositors- is derived solely from the use or investment of deposits, and any tax imposed on such Banks, must necessarily, to some extent, diminish the interest to he received ,by depositors, and may he said therefore to be paid out of the interest due to them. So the tax imposed by the Act in Sterling’s Oase, and the tax assessed by the Act of 1874, are not in our opinion taxes on the property of Savings Banks held by them in trust for depositors, hut a tax on the franchises which such institutions enjoy through the favor of
Entertaining these views, we should hold that the deposits of the appellee invested in ground rents are not exempt from the operation of the Act of 1874, but for the fact that the Act was passed after the decision in Sterling’s Oase, upon the construction of a prior Act identical in terms with the Act of 1874. If by the latter Act, the Legislature meant to tax the deposits, whether invested in non-taxable securities, or ground rents on which taxes were paid by the leasehold owner, this intention, in view of the decision in Sterling’s Oase, ought to have been expressed in clear and explicit terms.
The decision in Mayor, &c., of Baltimore vs. Canton Company of Baltimore, 63 Md., 218, rests altogether on ■different principles. It was decided under the Act of' 1880, chap. 20, which required that the real estate belonging to corporations should be valued and assessed to-such corporations, and that the taxes thus levied should be paid by them, and that the Tax Commissioners should deduct the assessed value of such real property from the aggregate value of the shares of stock. The Canton Company, being the owner of certain ground rents, claimed that the value of the ground rents should be deducted from the assessed value of its shares of stock. But the Court-said no, under our forms of leases for ninety-nine years renewable for ever, the law treats the tenant as owner, and the taxes levied on the premises are assessed to and paid bv him. The Act of 1880 allows deductions only for real estate owned by and assessed to the corporation, and on which it pays taxes. “Those corporations only,” say the Court, “are to be regarded as owners of real estate, the valuation of which is to be deducted from the valuation of their stock, to whom the land is directly assessable, and who are primarily chargeable with the taxes thereon.”
Judgment affirmed.
Concurrence Opinion
filed the following opinion:
I fully concur in the affirmance of the judgment of the • Court below, and for the reasons assigned by the learned Judge of that Court, as we have them set out in the record. I am opposed to overruling the case of State vs. Sterling, 20 Md., 502, and, in this case, it is wholly unnecessary to the conclusion reached. That case was very fully and ably argued, and it appears to have been carefully considered by the Court. It involved simply th.e construction of a local revenue statute of our own State, and I can see no propriety in overruling the decision
(Filed 23rd June, 1887.)
filed the following opinion:
The requirement of the Act of 1874, chapter 483, section 85, is that the president or other proper officer of a-
The record shows that the deposits on which taxes are claimed in this suit are invested in ground rents in the City of Baltimore, reserved on leases for ninety-nine years renewable forever; and that the respective tenants of the leasehold interests in the lots of ground on which the
The case of the Provident Institution arose in Massachusetts. The decision of the Supreme Court of the State is reported in 12 Allen, 312; but the Court refer to and adopt their previous opinion in Commomoealth vs. People’s Five Cents Savings Bank, in 5 Allen, 428. A statute required every Savings Bank to pay to the Treasurer of' the commonwealth a tax on account of its depositors of one-half of one per cent, per annum on the amount of its deposits, to be assessed, one-half of the tax on the average amount of its deposits for the six months preceding the first day of May, and the other half on the average amount of its deposits for the six months preceding the first day of November. And it provided that, if in default, the corporation should be liable to an action of contract for the amount of the tax ; and that it might be enjoined from the exercise of its franchise until all taxes-were paid. The Court held that if regarded as laying a tax on money in the hands of the corporation belonging to depositors, the statute would be contrary to the Constitution of Massachusetts; but that if it could be regarded as an excise or duty levied on the privilege or franchise of' the corporation, it would be' valid. It said that it would not declare the statute to be a violation of the funda
It will be seen that the statutes which have been mentioned differ in some material respects from ours. But if they were identical, I think it would be our duty to maintain the law as decided by our own Court. The decision in State vs. Sterling, meets with my entire approval. In no portion of the Act of 1874, chapter 483, do the Legislature use terms which indicate a purpose to require payment of money for the privilege of carrying on business either by an individual or a corporation. By other statutes, however, licenses are required for various descriptions of.business. Savings Banks have no peculiar or exclusive privileges. • They receive money and lend it out for the benefit of the depositors, without any profit to the corporations. Their whole purpose is in the highest degree beneficent. Any private individual is at liberty to devote his time and labor to the public good in the same way, if he feels disposed to do so. A tax on the franchise of a Savings Bank may be laid by statute ; that is to say a tribute may be exacted for the privilege of existing, and exercising its functions. It is for the Legislature to decide whether this shall be done. But in all discussions on this subject, it is well to bear in mind the wise and weighty words of the learned Cooley: “ A tax on a corporate franchise may or may not be just or politic. If the business is one of which corporations have a monopoly, a tax on their franchises, however heavy, would not be burdensome, be
(Filed 7th November, 1887.)