classification of certificates of stock in corporations and associations, or a classification based on an immaterial circumstance like the separation of sales plus a trading stamp from all other sales. (O'Keefe v. Somerville, 190 Mass. 110, 112.) It seems probable that such a classification would be held unconstitutional. It would certainly afford justification for the contention that the real purpose was not to raise revenue by taxation but to avoid constitutional limitations preventing extermination of billboards by regulation. Occupation and License Taxes.-A license tax is doubtless permissible as an excise under the State Constitution. Even the judges who favored the narrow interpretation of the constitutional right to levy excises on commodities recognized that a license tax might be imposed upon an occupation which the State might regulate. "There is a large class of occupations in regard to which the State may well legislate by regulation in the public interest and they frequently have been subjected to excise taxes in this Commonwealth and elsewhere. Attorneys at law, auctioneers, tavern keepers and retailers of spirituous liquors are among those engaged in occupations of this class." (Opinion of Justices, 196 Mass. 603, 625.) As has been previously stated, regulation seems clearly within the scope of the police power. It is well settled under other Constitutions, however, that a license tax, unless levied on a business that can be wholly prohibited under the police power, must be limited approximately to the cost of regulation (Gaynor v. Roll, 75 At. 179 (N. J.)); and even if such were not the decision under our State Constitution, the Supreme Court of the United States has held that a license tax, justified solely on the ground of the police power, to avoid the prohibitions of the Fourteenth Amendment requiring equal protection of the laws, must not exceed approximately the cost of regulation. (Atlantic, etc., Tel. Co. v. Philadelphia, 190 U. S. 160, 164.) If the business licensed is one which the State under the police power may wholly prohibit, such as the liquor business, so-called license fees required as a condition of carrying it on may exceed the cost of regulation even if justified under the police power and not as a revenue measure. (Gray, Limitation of the Taxing Power, Sec. 1452; Howes v. Maxwell, 157 Mass. 333, 334.) This exception does not concern us here, for it is plain that under our present Constitution outdoor advertising cannot be absolutely prohibited. (Bryan v. Chester, 212 Pa. 259.) A license tax owing to this constitutional limitation would probably in no way satisfy the advocates of taxation. Apart from license taxes, justified rather under the police power than under the taxing power, the only possibility is an occupation tax upon the business of outdoor advertising. If upheld by our own Supreme Court under the clause permitting an excise on commodities, it clearly would be upheld by the Supreme Court of the United States, for it has been decided several times that occupation taxes enacted by the States are not repugnant to the Fourteenth Amendment, and very broad powers as to the rate and method of assessment have been upheld. The only limitation is that the Court shall not be able to say that the method of classification adopted could not have been deemed reasonable by the Legislature. Classifications within an occupation based on the amount of business done with a different rate of tax for each class and even with progressive rates have been upheld in occupation taxes as in inheritance taxes. (Bradley v. Richmond, 227 U. S. 477; Clark v. Titusville, 184 U. S. 329, 334; Quong Wing v. Kirkendall, 223 U. S. 59, 62, 64; Singer Sewing Machine Co. v. Brickell, 34 Sup. Ct. Rep. 493, 497; Ohio Tax Cases, 34 Sup. Ct. Rep. 372, 376.) If an excise on this occupation can be levied in this State, it would seem from the language of some of our decisions that there would be little difficulty with the question of classification or measure or rate of tax. (Conn. Insurance Co. v. Comm., 133 Mass. 161; Boston Elevated Ry. Co. v. Comm., 199 Mass. 96, 98.) If the Pennsylvania decision above referred to is followed, however, it might be impossible to levy an occupation tax the rate of which should be measured by the size of the billboards. A license fee of 50 cents per square foot on all existing signs beyond a certain size and height was held unreasonable because the proprietor of the billboard would pay under it nearly twice its gross income. (Chicago v. Gunning System, 214 Ill. 628.) It is a most difficult problem to predict what the Supreme Judicial Court of Massachusetts would say as to the validity under the State Constitution of an occupation tax limited to outdoor advertising. It is not clear from the Opinion of the Justices in 196 Mass. 603 that even those who favored strict construction meant to limit the right of the State to levy an occupation tax under the clause permitting excises on commodities. The court was then specifically considering an excise on the commodity of transfer of title to shares of stock in corporations and associations. Judges Knowlton, Morton and Braley recognized that some occupation taxes might be assessed. It is possible that they would have held, if the question had been before them, that such an excise could only be levied on occupations which derived some privilege from the State, or must be treated as identical with a license tax upon a business that could be regulated. They mentioned attorneys, auctioneers and innkeepers as engaged in occupations that had been subjected to such excises. A few lines above they said, "an excise tax, under our Constitution, cannot be imposed upon the mere exercise of a natural right which is not a proper subject for governmental regulation." (196 Mass. 603, 625.) Judges Hammond, Loring and Sheldon, who took the broad view of the power conferred by this clause of the Constitution, held that under it the Legislature had the same power to levy excises as the Legislature of New York or the Congress of the United States. (196 Mass. 618.) If this view is sustained there is undoubted power to levy such an occupation tax. Judge Rugg, who differed from all the others, said nothing which throws light on his views on this particular subject. (196 Mass. 619.) In the previous decisions of the court there have been noticeable swings on the one hand toward strict construction, and, on the other hand, toward liberal construction of this clause. The earliest important decision laid down a liberal interpretation. (Portland Bank v. Apthorp, 12 Mass. 252, 254.) Judge Knowlton and his associates thought this had been limited by the case of Gleason v. McKay, 134 Mass. 419, 424, as followed in O'Keefe v. Somerville, 190 Mass. 110, 112. (196 Mass. 629.) The problem is one of interpretation of the word "commodity," to which a somewhat strained interpretation has always been given in this State in order to justify taxes which had been customary. The only limitation on an excise on a commodity is that it shall be reasonable, but the courts seem to have treated the definition of the word "commodity" and the limitations imposed by the word "reasonable" as substantially the same problem. V. CONCLUSION. The Commission on the Taxation of Signs did not feel able to recommend any special tax that would positively be sustained by the courts under the present Constitution of Massachusetts. Within certain limits regulation was found to be possible, and the Commission presented a draft of a bill designed to give effect to such action. The Commission recommended, however, as the most advisable step to be taken, the adoption of the amendment already cited conferring upon the General Court full power and authority to deal with the subject. NOTE. Since the foregoing account was prepared the Constitutional Convention of Massachusetts submitted to the people the following amendment and it was ratified November 5, 1918: Advertising on public ways, in public places and on private property within public view may be regulated and restricted by law. BIBLIOGRAPHY. Evans, L. B. Leading Cases on American Constitutional Law. Chicago, 1916. Chicago. The City Club Bulletin, City Club of Chicago. "Billboard and Other Forms of Outdoor Advertising." Chicago, 1912. Massachusetts. "Report of the Massachusetts Commission on the Taxation of Signs." Boston, January, 1915. House Document, 1637. New York. Raymond B. Fosdick. "A Report on an Investigation of Billboard Advertising in New York City." New York City, 1912. New York. "Report of the Mayor's Billboard Advertising Commission of the City of New York." New York City, August 1, 1913. Springfield. "Report on Billboard Advertising in Springfield, Massachusetts." Springfield, Mass., 1915. St. Louis. Signs and Billboards Committee of the Civic League of St. Louis. "Billboard Advertising in St. Louis." St. Louis, 1910. Great Britain. Home Department. Laws of France, Germany, Austria, Italy, Belgium, Holland, Switzerland and United States for the Regulation and Taxation of Public Advertisements. Parliament, 1903. House of Commons, Reports and Papers, No. 323. Evans, R. "Advertising as a Trespass on the Public," Nineteenth Century, xxxvii, 968 (1895). Millard, E. L. "Present Legal Aspect of the Billboard Problem," Illinois Law Review, xi, 29 (1916). "Municipal Regulation of Bill Boards," Minnesota Law Review, I, 441 (1917). |