ceipts of its earnings in Michigan was at its chief office in the City of New York.

The business by which all right to such earnings accrued was completed within the State of Michigan; and according to the ordinary course of such business, any suit to collect such earnings must be brought in Michigan, where the contracts therefor were made and fulfilled.

Philadelphia. It merely obtained a lease of a | tion in Michigan, merely because the final resufficient landing place on the Pennsylvania shore; 114 U. S. 205 (Bk. 29: 162) and on page 203 this court uses the following language: "The business of landing and receiving passengers and freight at the wharf in Philadelphia is a necessary incident to, indeed is a part of, their transportation across the Delaware River from New Jersey. Without it that transportation would be impossible. Transportation implies the taking up of persons or property at some point and putting them down at another. A tax, therefore, upon such receiving and landing of passengers and freight is a tax upon their transportation; that is, upon the commerce between the two States involved in such transportation."

The case of Pickard v. Pullman Palace Car Co. 117 U. S. 34 (Bk. 29, L. ed. 785), is distinguishable. In that case the company had no office in the State (Tenn.) through which its

cars ran.

A corporation which seeks by its agents to establish a domicil of business in a State other than that of its own creation must take that domicil, subject to the responsibilities and burdens imposed by the laws which it finds in force there.

Atty-Gen. v. Bay State Min. Co. 99 Mass. 153; Ricker v. American etc. Co. 140 Mass. 350; Carron Iron Co. v. McLaren, 5 H. L. Cas. 416, 449. The Tennessee Statute imposing the tax in Pickard v. Pullman Palace Car Co. supra, was objectionable because it purported to make entirely illegal certain interstate commerce, except on payment of the license fee as a condition precedent, and was therefore no better than a statute to collect, at the state line, duties on in

terstate commerce.

The method of ascertaining taxes measured by gross receipts has been approved by this court and by the Supreme Court of Michigan. State Taxon Railway Gross Receipts, 15 Wall. 284 (82 U. S. bk. 21, L. ed. 164); Delaware R. R. Tax, 18 Wall. 206 (85 U. S. bk. 21, L. ed. 888); Erie R. Co. v. Pa. 21 Wall. 492 (88 U. S. bk. 22, L. ed. 595); State Treasurer v. AuditorGen. 46 Mich. 231, 232; Chicago etc. R. Co. v. Auditor-Gen. 53 Mich. 79. In this connection see Woodruff v. Parham, 8 Wall. 123 (75 U. S. bk. 19, L. ed. 382); Savings Society v. Coite, 6 Wall. 594 (73 U. S. bk. 18, L. ed. 897); Provident Sav. Institution v. Mass. 6 Wall. 611 (73 U. S. bk. 18, L. ed. 907).

Summary. The tax in question is valid for the following reasons:

The tax is on business done in the exercise of corporate franchises, introduced by permission of the State of Michigan.

The tax is on such business done by means of the complainant's permanently established local agents and offices in Michigan, with every facility for carrying on business between places within the State, whenever profitable.

The tax is necessary to the safety of the State's revenue, from railroad companies aud express companies.

The tax is upon railroad business so affecting and controlling public interests of the people of the State of Michigan that such business ought not to escape taxation in the State.

Mr. Justice Miller delivered the opinion of the court:

This is a writ of error to the Supreme Court of the State of Michigan to bring here for review a decree sustaining a demurrer to the complainant's bill in chancery, and dismissing the bill. The complainant brought suit as President of the Merchants' Dispatch Transportation Company, averring that said company is a joint stock association, organized and existing under the laws of the State of New York, and by the laws of that State authorized to sue in the name of its president. The bill, so far as it presents the questions on which this court can have jurisdiction, charges as follows:

"Second. That during the year ending with the 31st day of December, A. D. 1883, the said Transportation Company was engaged in the business of soliciting and contracting for the transportation of freight required to be carried over connecting lines of railroad in order to reach its destination, and, for the prosecution of its said business, it had agencies located generally throughout the United States and the Dominion of Canada; the said Transportation Company issued through bills of lading for such freight, and caused the same to be carried by the appropriate railroad companies; and, as compensation for its service in the premises, the said Transportation Company was paid by the said railroad companies a definite proportion of the through rate charged and collected by said companies for the carriage of said freights.

"Third. That during the said year the said Transportation Company was possessed of certain freight cars which were used and run_by the railroad companies in whose possession they chanced from time to time to be for the transportation, upon their own and connecting lines of railroad, of through freight, principally between the City of New York, in the State of New York, and Boston, in the State of Massachusetts, and Chicago, in the State of Illinois, and other points and commercial centers in the West, Northwest and Southwest, without the said State of Michigan; that said cars were not used for the carriage of freight between points situate within the said State of Michigan, but wholly for the transportation of freight, either passing through the State or originating at points without said State and destined to points within, or originating at points within said State and destined to points without; that the said several railroad companies thus making use of said cars during the said year paid to the said Transportation Company as compensation therefor a definite sum per mile for the distance traveled by the said cars over their respective lines.

"Fourth. That the said Transportation ComThe complainant ought not to escape taxa-pany during the said year was not running or

The contention of the plaintiff in error is the Auditor-General, on the first day of June that the Statute of Michigan, the material parts of each year, a computation of the amount of of which are recited in the bill, is void as a tax which would become due on the first day regulation of commerce among the States, of July next suceeding from each person, aswhich, by the Constitution of the United States, sociation, or corporation liable to pay such is confided exclusively to Congress. Art. 1, taxes. Each one of these is by section 5 re§8, clause 3. It will be observed that the bill quired to pay to the State Treasurer, upon the shows that the tax finally assessed by the Aud-statement of the Auditor-General, an annual itor of State, against the Transportation Com- tax of 2 per cent upon its gross receipts, pany, was for the $28,890.01 of the gross as computed by the Commissioner of Railreceipts which the Company had returned to the commissioner as money received for the transportation of freight from points without to points within the State of Michigan, and from points within to points without that State; and that no tax was assessed on the $95,714.50 received for transportation passing entirely through the State to and from other States.

There is nothing in the opinion of the Supreme Court of the State, which is found in the transcript of the record, to explain this discrimination. There is nothing in the Statute of the State on which this tax rests which makes such a distinction; nor is there anything in the commissioner's requirement for a report which suggests it. It must have been, therefore, upon some idea of the authorities of the State that the one was interstate commerce and the other was not, which we are at a loss to comprehend. Freight carried from a point without the State to some point within the State of Michigan as the end of its voyage; and freight carried from some point within that State to other States is as much commerce among the States as that which passes entirely throught he State from its point of original shipment to its destination. This is clearly stated and decided in the case of Phila. & Reading Railroad Co. v. Pa. commonly called the case of The State Freight Tax, 15 Wall. 232 [82 U. S. bk. 21, L. ed. 146], in which it is held that a tax upon freight taken up within the State and carried out of it, or taken up without the State and brought within it, is a burden on interstate commerce, and therefore a violation of the constitutional provision that Congress shall have power to regulate commerce with foreign nations and among the several States. And in Wabash R. Co. v. Ill. 118 U. S. 557 (Bk. 30, L. ed. 244], it is held that a statute attempting to regulate the rates of compensation for transportation of freight from New York to Peoria, in the State of Illinois, or from Peoria, to New York, is a regulation of commerce among the States. The same principle is established in Crandall v. Nevada, 6 Wall. 35 [73 U. S. bk. 18, L. ed. 745].

roads.

It will thus be seen that the Act imposed a tax upon all the gross receipts of the Merchants Dispatch Transportation Company, a corporation under the laws of the State of New York, and with its principal place of business in that State, on account of goods transported by it in the State of Michigan; and the bill states that the Company carried no freight, the transportation of which was between points exclusively within that State.

The subject of the attempts by the States to impose burdens upon what has come to be known as interstate commerce or traffic, and which is called in the Constitution of the United States "commerce among the States," by statutes which endeavor to regulate the exercise of that commerce, as to the mode by which it shall be conducted, or by the imposition of taxes upon the articles of commerce, or upon the transportation of those articles, has been very much agitated of late years. It has received the attentive consideration of this court in many cases, and especially within the last five years, and has occupied Congress for a time quite as long. The recent Act, approved February 4, 1887, entitled An Act to Regulate Commerce," passed after many years of effort in that body, is evidence that Congress has at last undertaken a duty imposed upon it by the Constitution of the United States, in the declaration that it shall have power "to regulate commerce with foreign Nations, and among the several States, and with the Indian Tribes.' Congress has freely exercised this power so far as relates to commerce with foreign Nations and with Indian Tribes, but in regard to commerce among the several States it bas, until this Act, refrained from the passage of any very important regulation upon this subject, except perhaps the statutes regulating steamboats and their occupation upon the navigable waters of the country.

With reference to the utterances of this court until within a very short time past, as to what constitutes commerce among the several States, and also as to what enactments by the State The Statute of the State of Michigan of 1883, Legislatures are in violation of the constituunder which this tax is imposed, is entitled tional provision on that subject, it may be ad"An Act to Provide for the Taxations of Per-mitted that the court has not always employed sons, Copartnerships, Associations, Carloaning the same language, and that all of the judges Companies, Corporations, and Fast Freight of the court who have written opinions for it Lines Engaged in the Business of Running Cars over Any of the Railroads of This State, and Not Being Exclusively the Property of any Railroad Company Paying Taxes on Their Gross Receipts." Sections 1 and 2 require reports to be made to the commissioner of railroads of the gross amount of their receipts for freight earned within the limits of The State from all persons and corporations running railroad cars within the State. The commissioner is by section 4 required to make and file with

may not have meant precisely the same thing. Still, we think the more recent opinions of the court have pretty clearly established principles upon that subject which can be readily applied to most cases requiring the construction of the constitutional provision, and that these recent decisions leave no room to doubt that the Statute of Michigan, as interpreted by its supreme court in the present case, is forbidden as a regulation of commerce among the States, the power to make which is withheld from the State.

66

The whole question has been so fully consid-State the nature of the exaction is not changed ered in these decisions, and the cases themselves by adding to it similar conditions for allowing so carefully reviewed that it would be doing transportation wholly within the State." little more than repeating the language of the In the case of The Erie Railway Company (a arguments used in them to go over the ground corporation of the State of New York) v. again. The cases of The State Freight Tax and Pennsylvania, decided at the same time, it apState Tax on Railway Gross Receipts, which peared that the road of that company was conwere considered together and decided at the structed for a short distance through a part of December Term, 1872, and reported in 15 Wal- the State of Pennsylvania, and that a similar lace, pp. 232 to 328 [82 U. S. bk. 21, 146-189], tax was levied upon it for freight carried over present the points in the case now before us its road. This was held to be invalid for the perhaps as clearly as any which have been be- reasons given in the case of the Reading Road. fore this court. A Statute of the State of Penn- In the other case of State Tax on Railway sylvania imposed upon all the railroad corpora- Gross Receipts, which was also a suit between tions doing business within that State, as well the Reading Railway Company and the Stateas steamboat companies and others engaged in of Pennsylvania, an Act of the Legislature of the carrying trade, a specific tax on each that State was relied on which declared that 2,000 pounds of freight carried, graduated ac- 'In addition to the taxes now provided by law, cording to the articles transported. These were every railroad, canal and transportation comarranged into three classes, on the first of which pany incorporated under the laws of this Coma tax of two cents per ton was laid, upon the monwealth, and not liable to the tax upon insecond three cents, and upon the third five come under existing laws, shall pay to the cents. The Reading Railroad Company, a Commonwealth a tax of three fourths of 1 per party to the suit, in making its report under centum upon the gross receipts of said comthis statute, divided its freight on which the pany; and the said tax shall be paid semi-antax was to be levied into two classes, namely: nually upon the first days of July and Janufreight transported between points within the ary, commencing on the first day of July, 1866." State and freight which either passed from within the State out of it or from without the State into it. The Supreme Court of the State of Pennsylvania decided that all the freight carried, without regard to its destination, was liable to the tax imposed by the statute. This court, however, held that freight carried entirely through the State from without, and the other class of freight brought into the State from without or carried from within to points without, all came under the description of commerce among the States," within the meaning of the Constitution of the United States; and it held also that freight transported from and to points exclusively within the limits of the State, was internal commerce and not commerce among the States. The taxing law of the State was, therefore, valid as to the latter class of transportation; but with regard to the others it was invalid, because it was interstate commerce, and the State could lay no tax upon it. In that case, which was very thoroughly argued and very fully considered, the case of Crandall v. Nevada, 6 Wall. 35 [73 U. S. bk. 18, L. ed. 745], was cited as showing, in regard to transportation, what was strictly internal commerce of a State and what was interstate commerce. The court said: "It is not at all material that the tax is levied upon all freight, as well that which is wholly internal as that embarked in interstate trade. We are not at this moment inquiring further than whether taxing goods carried because they are carried, is a regulation of carriage. The State may tax its internal commerce; but if an Act to tax interstate or foreign commerce is unconstitutional, it is not cured by including in its provisions subjects within the domain of the State. Nor is a rule prescribed for carriage of goods through, out of, or into a State any less a regulation of transportation because the same rule may be applied to carriage which is wholly internal. Doubtless a State may regulate its internal commerce as it pleases. If a State chooses to exact conditions for allowing the passage or carriage of persons or freight through it into another

This tax was held to be valid. The grounds upon which it was distinguished from the one in the preceding case upon freight were, that the corporation, being a creation of the Legislature of Pennsylvania and holding and enjoying all its franchises under the authority of that. State, this was a tax upon the franchises which it derived from the State, and was for that reason within the power of the State, and that, in determining the mode in which the State could tax the franchises which it had conferred, it was not limited to a fixed sum upon the value of them, but it could be graduated by and proportioned to either the value of the privileges. granted or the extent or results of their exercise. "Very manifestly," said the court, "this is a tax upon the railroad company, measured. in amount by the extent of its business, or the degree to which its franchise is exercised." Another reason given for the distinction is that "The tax is not levied, and, indeed such a tax cannot be, until the expiration of each half year, and until the money received for freights, and from other sources of income, has actually come into the company's hands. Then it has lost its distinctive character as freight earned, by having become incorporated into the general mass of the company's property. While it must be conceded that a tax upon interstatetransportation is invalid, there seems to be no stronger reason for denying the power of a State to tax the fruits of such transportation after they have become intermingled with the general property of the carrier, than there is for denying her power to tax goods which have been imported, after their original packages have been broken, and after they have been mixed with the mass of personal property in the country. Brown v. Md. 12 Wheat. 420 [25 U. S. bk. 6, L. ed. 678].

The distinction between that case, which is mainly relied upon by the Supreme Court of Michigan in support of its decree, and the one which we now have before us, is very obvious, and is twofold: first, the corporation which was the subject of that taxation was a Pennsylvania

and the City of Philadelphia, in the State of Pennsylvania. It had no property within the State of Pennsylvania, but it leased a landing place or wharf in that city for its business. The Auditor-General and Treasurer of the State of Pennsylvania assessed a tax upon the capital stock of this corporation under the laws of that State, which the company refused to pay. Its validity was sustained by the State Su

corporation, having the situs of its business | tion chartered by the State of New Jersey to within the State which created it and endowed run a ferry carrying passengers and freight beit with its franchises. Upon these franchises tween the Town of Gloucester, in that State, thus conferred by the State, it was asserted, the State had a right to levy a tax; second, this tax was levied upon money in the treasury of the corporation, upon property within the limits of the State, which had passed beyond the stage of compensation for freight and had become like any other property or money liable to taxation by the State. The case before us has neither of these qualities. The Corporation upon which this tax is levied is not a Corpora-preme Court, and the question was brought to tion of the State of Michigan, and has never been organized or acknowledged as a corporation of that State. The money which it received for freight carried within the State probably never was within the State, being paid to the Company either at the beginning or the end of its route; and certainly at the time the tax was levied it was neither money nor property of the Corporation within the State of Michi

gan.

The proposition that the States can, by way of a tax upon business transacted within their limits, or upon the franchises of corporations which they have chartered, regulate such business or the affairs of such corporations, has often been set up as a defense to the allegation that the taxation was such an interference with commerce as violated the constitutional provisions now under consideration. But where the business so taxed is commerce itself, and is commerce among the States or with foreign Nations, the constitutional provision cannot thereby be evaded; nor can the States, by granting franchises to corporations engaged in the business of the transportation of persons or merchandise among them, which is itself interstate commerce, acquire the right to regulate that commerce, either by taxation or in any other way.

this court by a writ of error. It was insisted that the tax was justified as a tax upon the business of the corporation, which, it was claimed, was largely transacted in the City of Philadelphia. The Supreme Court of the State, in giving its decision, stated that the single question presented for consideration was whether the company did business within the State of Pennsylvania within the period for which the taxes were imposed; and it held that it did because it received and landed passengers and freight at its wharf in the City of Philadelphia. The argument was very much urged in this court that the licensing of ferries across navigable rivers, whether dividing two States or otherwise, had always been within the control of the States, and that this, being a mere tax upon the business of that corporation carried on largely within the State of Pennsylvania, was within the power of that State to regulate. But this court held, after an extensive review of the previous cases, that the business of ferrying across a navigable stream between two States was necessarily commerce among the States, and could not be taxed as was attempted in that case.

In the case of Pickard v. Pullman Southern Car Co. 117 U. S. 34 [Bk. 29, L. ed. 785], decided at the last term of the court, it was shown This is illustrated in the case of Cook v. Pa. that the Legislature of Tennessee had imposed 97 U.S. 566 [Bk. 24, L. ed. 1015]. The State what it called a privilege tax under the constiof Pennsylvania, by her laws, had laid a tax tution of that State of $50 per annum upon upon the amount of sales of goods made by every sleeping car or coach run or used upon a auctioneers, and had so modified and amended railroad in that State, not owned by the railroad this class of taxes that in the end it remained company so running or using it. This, it will be a discriminating tax upon goods so sold and perceived, is very much like the tax in the case imported from abroad. This court held that before us, except that it is a specific tax of $50 the tax which the auctioneer was required to per annum upon the car instead of a tax upon pay into the treasury was a tax upon the goods the gross receipts arising from the use of the sold, and, as this tax was three quarters of 1 car by its owner. In that case, after an exper cent upon foreign drugs, glass, earthen- haustive review of the previous decisions in ware, hides, marble work and dye woods, that this class of cases by Mr. Justice Blatchford, it was a tax upon the goods so described for the who delivered the opinion of the court, it was privilege of selling them at auction. The ar- held that, as these cars were not property logument was made that this was a tax exclus-cated within the State, it was a tax for the privively upon the business of the auctioneer, which the State had a right to levy. In that case, as in others, it was claimed that the privilege of being an auctioneer derived from the State by license, was subject to such taxation as the State chose to impose, but the proposition was overruled; and this court held that the tax was a regulation of commerce with foreign Nations, and that the fact that it was a tax upon the business of an auctioneer did not relieve it from the objection arising from the constitutional provision.

The same question arose in the case of The Gloucester Ferry Co. v. Pa. 114 U. S. 196 [Bk. 29. L. ed. 158]. That company was a corpora

ilege of carrying passengers in that class of cars through the State, which was interstate commerce, and for that reason the tax could not be sustained.

Two cases have been decided at the present term of the court in which these questions have been considered, one of them at least involving the subject now under consideration, namely, that of Sabine Robbins v. Taxing District of Shelby Co. Tenn. [ante, 45]. A Statute of that State declared that "All drummers, and all persons not having a regular licensed house of business in the taxing district, offering for sale or selling goods, wares, or merchandise therein by sample, shall be required to pay to the