are cases decided by it which it has had to carefully distinguish from the one under consideration. There are others of its cases which, alleged to be conflicting, it has had to reconcile. And there are still other cases, in which it has pronounced judgment, which it has recognized, either at the time they were decided or subsequently thereto, as being on the border line. Undoubtedly, there inheres in the subject unusual difficulty. The maintenance of the supremacy of the Federal Constitution is necessary to the existence of the Union, but the power of taxation is necessary to the existence of the states that compose the Union. The taxing power of the state must not be restricted short of the farthest limit to which it constitutionally extends; no exercise of that power, however, can be sustained when to sustain it will be to sanction a direct violation of the Federal Constitution to some extent, be it however slight. That facts alter cases and will be recognized as altering cases is peculiarly true when the cases are ones involving the validity, under the commerce clause, of state taxes. This does not mean that sophistries will be indulged nor that decisions will be made to turn on metaphysical distinctions. It means only that a distinction with a basis in fact will not be brushed aside with any broad generalization based on specious similarity. Indeed, it is this duty, devolving on the Federal Supreme Court, of maintaining the nice adjustment between the respective powers of the state and federal governments that justifies the "necessary caution" of Mr. Justice Hughes that "every case involving the validity of a tax must be decided upon its own facts." ,, 33 § 4586. Property taxes. Recognizing the immunity of interstate and foreign commerce from state taxation,34 it is one thing to impose a tax on such commerce or on the carrying on thereof, and quite another thing to impose a tax on locally situated property which belongs to a corporation engaged in interstate or foreign commerce and which is employed by such corporation in the carrying on of such commerce. The fact that no state can compel a corporation to pay for its right to carry on interstate or foreign commerce 35 does not prevent a state from imposing ordinary property taxes on property which is employed in such commerce but which has a situs within the state's territorial boundaries.36 33 Kansas City, Ft. S. & M. R. Co. v. Botkin, 240 U. S. 227, 60 L. Ed. 617, quoting Baltic Min. Co. v. Massachusetts, 231 U. S. 68, 58 L. Ed. 127. See also Kansas City, M. & B. R. Co. v. Stiles, 242 U. S. 111, 61 L. Ed. 176. 36 Atlantic & P. Tel. Co. v. Philadelphia, 190 U. S. 160, 47 L. Ed. 995. Corporations, although engaged in interstate commerce, should bear their proper proportions of the burdens of the governments under the protection of which they conduct their business,37 and the Federal Supreme Court has, throughout the years, consistently declared that the mere fact that property, which is otherwise within the state's taxing power, is owned by a corporation engaged in interstate or foreign commerce 38 and is used by such corporation in carrying on such commerce, does not exempt it from state taxation.39 No doubt "state taxation of interstate commerce, directly placed upon the articles or subjects of such commerce, or upon the necessary means of their transportation, may be used to restrict or regulate such commerce, and, more than once, this court has been obliged to pronounce invalid state legislation respecting such matters. On the other hand, we have frequently had occasion to show that the existence of federal supervision over interstate commerce and the consequent obligation upon the federal courts to protect that right of control from encroachment on the part of the states, are not inconsistent with the power of each state to control its own internal commerce, and to tax the franchises, property, or business of its own corporations engaged in such commerce nor with its power to tax foreign corporations on account of their property within the state." New York, L. E. & W. R. Co. v. Pennsylvania, 158 U. S. 431, 39 L. Ed. 1043. The rule that a state may tax personal property which is within its jurisdiction even though such property is employed in interstate or foreign transportation holds good regardless of whether such transportation be by land or by water. Old Dominion S. S. Co. v. Virginia, 193 U. S. 299, 49 L. Ed. 1059, 3 Ann. Cas. 1100. 37 Adams Exp. Co. v. Ohio State Auditor, 165 U. S. 194, 41 L. Ed. 683. 38 Baltic Min. Co. v. Massachusetts, 231 U. S. 68, 58 L. Ed. 127. "Although the transportation of the subjects of interstate commerce, or the receipts received therefrom, or the occupation or business of carrying it on, cannot be directly subjected to state taxation, yet property belonging to corporations or companies engaged in such commerce may be." Adams Exp. Co. v. Ohio State Auditor, 165 U. S. 194, 41 L. Ed. 683. The "exemption of interstate and foreign commerce from state regulation does not prevent the state from taxing the property of those engaged in such commerce located within the state as the property of other citizens is taxed." Leloup v. Port of Mobile, 127 U. S. 640, 32 L. Ed. 311. 39 United States Exp. Co. v. Minnesota, 223 U. S. 335, 56 L. Ed. 459. "It is not and cannot be doubted that each state of the Union may tax all property, real and personal, within its borders, belonging to persons or corporations, although employed in interstate or foreign commerce, provided the rights and powers of the national government are not interfered with." Western U. Tel. Co. v. Taggart, 163 U. S. 1, 14, 41 L. Ed. 49. "It is well settled that there is nothing in the Constitution or laws of the United States which prevents a state from taxing personal property, employed in interstate or foreign commerce, like other personal property within its jurisdiction." * "It is settled," says such court, "that where by way of duties laid on the transportation of the subjects of interstate commerce, or on the receipts derived therefrom, or on the occupation or business of carrying it on, a tax is levied by a state on interstate commerce, such taxation amounts to a regulation of such commerce and cannot be sustained. But property in a state belonging to a corporation, whether foreign or domestic, engaged in foreign or interstate commerce, may be taxed, or a tax may be imposed on the corporation on account of its property within a state, and may take the form of a tax for the privilege of exercising its franchises within the state, if the ascertainment of the amount is made dependent in fact on the value of its property situated within the state (the exaction, therefore, not being susceptible of exceeding the sum which might be leviable directly thereon), and if payment be not made a condition precedent to the right to carry on the business, but its enforcement left to the ordinary means devised for the collection of taxes. The corporation is thus made to bear its proper proportion of the burdens of the government under whose protection it conducts its operations, while interstate commerce is not in itself subjected to restraint or impediment." 40 Pullman's Palace Car Co. v. Pennsylvania, 141 U. S. 18, 35 L. Ed. 613. A state may tax property which is permanently located within its territorial limits even though such property be employed in interstate commerce. Henderson Bridge Co. v. Henderson, 173 U. S. 592, 43 L. Ed. 823. The general rule that tangible personal property is taxable by the state in which it is situated, regardless of the state in which its owner has his domicile, is not affected by the fact that such property is employed in interstate transportation. Old Dominion S. S. Co. v. Virginia, 198 U. S. 299, 49 L. Ed. 1059, 3 Ann. Cas. 1100. A state "can tax property permanently within its jurisdiction although belonging to persons domiciled elsewhere and used in commerce among the states." Fargo v. Hart, 193 U. S. 490, 48 L. Ed. 761. "It has been again and again said by this court that while no state could impose any tax or burden upon the privilege of doing the business of interstate commerce, yet it had the unquestioned right to place a property tax on the instrumentalities engaged in such commerce." Cleveland, C., C. & St. L. R. Co. v. Backus, 154 U. S. 439, 38 L. Ed. 1041. The restriction upon the power of a state to interfere with interstate commerce does not in the least degree abridge the right of a state to tax at their full value all the instrumentalities used for such commerce." Adams Exp. Co. v. Ohio State Auditor, 166 U. S. 185, 41 L. Ed. 965. The mere fact that vehicles of transportation are employed in interstate commerce does not render invalid their taxation by a state. Marye v. Baltimore & O. R. Co., 127 U. S. 117, 32 L. Ed. 94. 40 Postal Tel. Cable Co. v. Adams, 155 U. S. 688, 39 L. Ed. 311, quoted in New York, L. E. & W. R. Co. v. 41 If the exaction, whatever its form, is essentially only property taxation, and is not discriminatory, it does not violate the commerce clause of the Federal Constitution. "Taxation on property, collectible by the ordinary means, does not affect interstate commerce otherwise than incidentally as all business is affected by the necessity of contributing to the support of government." 43 it is held that railroad companies, telegraph companies, Commonwealth of Pennsylvania, 158 U. S. 431, 39 L. Ed. 1043. See also St. Louis Southwestern Ry. Co. v. Arkansas, 235 U. S. 350, 59 L. Ed. 265. 41 Adams Exp. Co. v. Ohio State Auditor, 165 U. S. 194, 41 L. Ed. 683. * 42"No doubt the capital stock of [domestic carrying corporations engaged in interstate or foreign commerce] regarded as inhabitants of the state, or their property, may be taxed as other corporations and inhabitants are, provided no discrimination be made against them as corporations carrying on foreign or interstate commerce, so as to make the tax, in effect, a tax on such commerce. But their business as carriers in foreign or interstate commerce cannot be taxed by the state under the plea that they are exercising a franchise.'' Philadelphia & S. Mail Steamship Co. v. Pennsylvania, 122 U. S. 326, 30 L. Ed. 1200. 43 Adams Exp. Co. v. Ohio State Auditor, 165 U. S. 194, 41 L. Ed. 683. Undoubtedly "every tax upon personal property or upon occupations, business or franchises, affects more or less the subjects and the operations of commerce. Yet it is not everything that affects commerce that amounts to a regulation of it, within the meaning of the Constitution. We think it may safely be asserted that the states have authority to tax the estate, real and personal, of all their corporations, including carrying companies, precisely as they may tax similar property when belonging to Thus, express natural persons, and to the same extent. We think also that such taxation may be laid upon a valuation, or may be an excise; and that, in exacting an excise tax from their corporations, the states are not obliged to impose a fixed sum upon the franchises or upon the value of them, but they may demand a graduated contribution proportioned either to the value of the privileges granted, or to the extent of their exercise, or to the results of such exercise. No mode of effecting this and no forms of expression which have not meaning beyond this can be regarded as violating the Constitution. A power to tax to this extent may be essential to the healthy existence of the state governments, and the Federal Constitution ought not to be construed as to impair, much less destroy, anything that is necessary to their efficient existence." Philadelphia & R. R. Co. v. Commonwealth of Pennsylvania (State Tax on Railway Gross Receipts), 15 Wall. (U. S.) 284, 21 L. Ed. 164. 44 See § 4588, infra. 45 A tax, which, although nominally a tax upon the shares of capital stock of a foreign telegraph company, is in effect a tax upon the company on account of property owned and used by it in the state, the value of which property is to be ascertained on the basis of the proportional length of the company's lines within the state, does not offend against the commerce clause. Western U. Tel. Co. v. Attorney-General of Commonwealth of Massachusetts, 125 U. S. 530, 31 L. Ed. companies, and interstate bridge companies,47 may be required by a state to pay a tax on such of their property as is within the state's territorial boundaries, and the commerce clause, so often enlisted as the great deliverer from such a tax, will continue to be impotent in the matter of winning the release that is sought. § 4587. Franchise and license taxes. The imposition of a license or privilege tax upon the carrying on of interstate or foreign commerce is obviously a regulation of such commerce as well as a burden thereupon, and a state statute imposing such a tax is necessarily invalid.48 But "it is * manifest that the state is not debarred from imposing a tax upon the granted privilege of being a corporation, because the corporation is engaged in interstate as well as intrastate commerce. 49 790, followed in Attorney General v. Western U. Tel. Co., 141 U. S. 40, 35 L. Ed. 628. See also St. Louis Southwestern R. Co. v. Arkansas, 235 U. S. 350, 59 L. Ed. 265 (aff'g 106 Ark. 321, 152 S. W. 110), sustaining Arkansas franchise tax on foreign corporations. 46 See § 4588, infra. 47 The fact that an interstate bridge is used by the corporation controlling it for purposes of interstate commerce does not exempt it from proportionate taxation by a state within whose limits it is, in part, permanently located although such state cannot impose direct burdens upon the conduct of the interstate commerce carried on over the bridge. Henderson Bridge Co. v. Henderson, 173 U. S. 592, 43 L. Ed. 823. See also § 4587, infra. 48 Crutcher v. Kentucky, 141 U. S. 47, 35 L. Ed. 649; Lyng v. Michigan, 135 U. S. 161, 34 L. Ed. 150; Leloup v. Port of Mobile, 127 U. S. 640, 32 L. Ed. 311. "It must be taken to be firmly established that one otherwise enjoying full capacity for the purpose cannot be compelled to take out a local license for the mere privilege of carrying on interstate or foreign commerce." Sault Ste. Marie v. International Transit Co., 234 U. S. 333, 58 L. Ed. 1337, 52 L. R. A. (N. S.) 574. 49 Kansas City, Ft. S. & M. R. Co. v. Botkin, 240 U. S. 227, 60 L. Ed. 617. "The right of a state to tax the franchise or privilege of being a corporation, as personal property, has been repeatedly recognized by this [Federal Supreme] court, and this whether the corporation be domestic or a foreign corporation doing business by its permission within the state. But a state cannot exclude from its limits a corporation engaged in interstate or foreign commerce or a corporation in the employment of the general government, either directly in terms or indirectly by the imposition of inadmissible conditions." Postal Tel. Cable Co. v. Alams, 155 U. S. 688, 39 L. Ed. 311. The New York tax on the primary franchise of navigation companies, which tax is to equal a certain fractional part of the gross earnings of such companies from intrastate business, is not invalid. New York v. Sohmer, 235 U. S. 549, 59 L. Ed. 355, aff'g 206 N. Y. 651, 99 N. E. 1115, and distinguishing Harmon v. Chicago, 147 U. S. 396, 37 L. Ed. 216. |