exercised by Congress in the various acts encouraging immigration without regard to nationality, and all State laws on the subject are invalid. Field, J., dissented, regarding the tax as a poll-tax on residents. The title of the act no doubt influenced the majority in not regarding it as a poll-tax on residents. It was "an act to protect free white labor against competition with Chinese coolie labor and to discourage the immigration of the Chinese into the State of California." 1

An apparent exception to the foregoing cases is a case that arose in Maryland. The charter of the Washington branch of the Baltimore and Ohio Railroad allowed it to charge a fixed rate for passengers, and required the railroad to pay one-fifth of the passage money into the treasury of the State. The charter was accepted, at various periods it was modified, but the feature requiring the payment of one-fifth of the passage money to the State was not changed. In 1868, the company refused to pay the one-fifth of the passage money, claiming that it was a regulation of interstate commerce, and void. The Court of Appeals of Maryland decided against the railroad, holding that the payment of this sum annually was not a regulation of commerce, and if it was, that it was waived by the railroad; and further holding that, if the act was unconstitutional, the money in the hands of the company was collected for the State, as its agent, and that it could not resist the claim of the principal, even if the act was unconstitutional. In the Supreme Court of the United States, the payment of the one-fifth of the passage money was regarded as a bonus paid by the company for the franchise; and while the State could not interfere with interstate commerce in the movement of persons or property, yet its right to charter railroads, and to impose terms for the privilege granted, was a clear and undoubted right. The railroad having accepted the charter, must accept it as a whole. It cannot receive the benefits and repudiate the burdens of the contract made with the State. The court repudiate the idea that the money was received by the railroad as the agent of the State."

A tax of ten cents on every passenger transported by common carriers (except sailors and soldiers of the United States) is a regulation of interstate commerce.5

(e) Transit of Freight.—The transportation of freight, or of the subjects of commerce, is a constituent part of commerce, and a tax

1 Lin Sing v. Washburn, 20 Cal. 534. See also the case of Ah Fong and Ah Fook, 1 Cent. L. J. 515, 516.

2 State v. Balt, & Ohio R. R. Co. 34 Md. 344.

3 34 Md. 344.

4 Railroad Company . Maryland, 21 Wall, 456.

* Clarke v. Philadelphia, 4 Houston, 158.

upon freight transported from State to State is a regulation of commerce among the States. The leading case on this subject arose out of a statute of Pennsylvania, requiring the officers of all transportation companies doing business in the State, and upon whose works freight may be transported, to make to the auditor of the State quarterly reports of the number of tons of freight carried over their works, and at the same time to pay to the treasurer of the State a tax ranging from two to five cents per ton, according to the class of the article, for each ton of freight transported. Where freight was carried upon different but continuous lines, it was chargeable as if upon one line, the whole tax to be paid by such one of the companies as the treasurer of the State might select. Corporations whose lines of improvement were used by others for transportation of freight, and whose only earnings arose from tolls charged for use, were authorized to add the tax to the tolls, and collect it therewith. Corporations whose lines extended into any other State, were to pay for the freight carried over that portion of their lines within the State. It was claimed that this was a legitimate exercise of the power of taxation, bona fide in its character, making no discrimination against nonresidents, and levied on the franchise of every corporation, in proportion to its business; that the law does not regulate the intercourse of the people of Pennsylvania with other States; that it neither regulates the carrier, nor the shipper, nor the purchaser of the goods transported; that the tax might be regarded as one imposed by the State as compensation for the use of artificial works created by her authority, and in the exercise of her right of eminent domain. But these views did not prevail; the act was held to be a regulation of commerce, and void as to the tax upon freight brought within the State or taken out of it. Strong, J., in a most elaborate opinion, concurred in by all the judges except Swayne and Davis, held that the constitutionality or unconstitutionality of a State tax is to be determined, not by the form or agency through which it is collected, but by the subject upon which the burden is laid; that in this case the burden of the tax was not upon the franchise of the company, it was not even in proportion to the business of the company; the same tax was paid by the freight carried one mile, and that carried one hundred miles. And where the company was one whose lines of improvement were used by others for which it received tolls, it was authorized to add the tax to the tolls, thus relieving the company from the tax, and exacting it in reality from the goods carried. The burden of the tax was thus placed upon the freight carried because of its carriage; the companies were mere tax-gatherers for the State;

their position is likened to that of one to whom public taxes are farmed out, who undertakes to advance to the State a required revenue, with power by suit or distress to collect a like amount out of those upon whom the tax is laid. The transportation of articles of trade from State to State, free from embarrassing restrictions by the several States, was the prominent idea in the minds of the framers of the Constitution, in committing to Congress the power to regulate commerce among the States under this law. Not a ton of freight can be taken up within the State and carried out of it, or taken up in other States and brought within it, until it shall pay the specified tax. It is the same in principle as if the State of Pennsylvania had established custom houses wherever the transportation companies pass the State line, and demanded there a duty for allowing merchandise to enter or leave the State. The tax cannot be regarded as a compensation for the use of the artificial highways of the State; for the use of these works a toll is paid to the owners of the franchises; nor is this a tax upon the franchise; it goes beyond the toll or franchise, and is a burden upon the freight. So far as the act affected freight carried from point to point within the State, it was a regulation of its internal commerce, and valid. But this gives no validity to that part of the act that affects the carriage of goods from State to State.1 So an act imposing a transit duty of three cents on every passenger, and two cents on every ton of freight carried by foreign transportation companies doing business in the State, is a regulation of commerce; though in form it is a tax on the business of the companies, it is in substance a tax on the commodities transported; and an act imposing a stamp duty upon bills of lading for goods transported from the State to any port or place out of the State, is void. And where a coal company chartered in Pennsylvania had coal lying on a pier at Elizabethport, New Jersey, mined on their lands in Pennsylvania, sent there to be shipped by water to other markets for purposes of sale, the custom of the company was when the coal arrived, to have it separated according to sizes, and when a cargo of one size was obtained, it was shipped to points in New England and along the Hudson as soon as a vessel could be obtained. None of the coal was sold at Elizabethport for consumption. It was claimed that the coal was

'Case of the State Freight Tax, 15 Wall. 232, 272, 279. Erie Railroad Co. v. State, 31 N. J. L. (2 Vroom), 531.

3 Almy v. State of California, 24 How. 168. The ground on which this decision was rested was, that it was a tax upon exports; but in subsequent cases the court say, the true ground is that it is a regulation of commerce. Woodruff v. Parham, 3 Wall. 173,

and 15 Wall. 280.

liable to tax in the hands of the agent of the company at Elizabethport, under a statute of New Jersey making a person liable to be taxed in the township or ward in which he resides for all property in his possession or under his control as trustee, guardian, executor, or agent. It was held that the property was not in the State under such circumstances as to be liable to taxation. "The power of the State to tax subjects of commerce, when the purposes of commerce have ceased, and they have become incorporated and mixed up with the mass of the property of the community, is well settled. But that a tax on the property belonging to a citizen of another State in its transit to market in other States, which is delayed in this State not for purposes of sale, but merely for separation and assortment for convenience of shipment to its destination, is a tax on commerce among the States, is too plain for argument." 2

The Pennsylvania act heretofore mentioned was passed in 1864. In 1866 another act was passed, imposing a tax of three-fourths of one per centum upon the gross receipts of certain transportation companies. The Reading Railroad was one of these companies. A large source of its profit was the transportation of coal from the coal regions to a place near Philadelphia, called Port Richmond, or to the Schuylkill Canal, from both which places most of it went to States other than Pennsylvania. In the opinion of the majority of the court, this act was not a regulation of commerce. Although the gross receipts are made up in part from freights received for transportation of merchandise from one State to another, a distinction was taken between a tax taken upon freights carried between States, because of their carriage, and a tax upon the fruits of such transportation after they have become intermingled with the other property of the carrier. It was regarded as a tax upon the franchises of the corporations, measured by the amount of business of the company. It is true that its ultimate effect may be to increase the cost of transportation. So the tax upon any article of personal property that may become the subject of commerce, or upon any instrument of commerce, affects commerce itself. A tax on steamboats or stage coaches has a tendency to increase the cost of transportation, but it is not a tax on commerce. A tax upon landlords as such affects rents, but it is not a tax upon tenants. A tax on the income of attorneys and physicians is not a tax on their clients or patients, although the burden ultimately falls on them. So a tax upon the gross receipts of the companies, while it

1 State v. Eagle, 34 N. J. L. (5 Vroom), 425.

* State Tax on Gross Railway Receipts, 15 Wall. 284, 292.

2 Beasley, J., Id. 427.

affects the cost of transportation, is not a tax upon the thing transported. The freight when received by the company has lost its distinctive character as freight earned, by having become incorporated into the general mass of the company's property. Judges Miller, Field and Hunt dissented, Miller, J., using this strong language: "I lay down the broad proposition that by no device or evasion, by no form of statutory words, can a State compel citizens of other States to pay it a tax, contribution or toll, for the privilege of having their goods transported through that State by ordinary channels of

The legislature of Connecticut incorporated a company to deepen and improve the channel of the river Thames, with authority to take tolls. Congress established a port of delivery on this river at Norwich. After the company had completed their work, additional sums were granted by the State and by Congress to improve the navigation of the river. This was not an act regulating commerce. It was an act imposing reasonable tolls as a compensation for rendering navigable or more extensively so a river within the borders of the State. It only extends the facilities for commercial intercourse by rendering the river navigable to a certain class of vessels, to which it was not navigable before. These tolls were likened to the "light money" paid to the Danes by the commercial world.

A license tax imposed on foreign insurance companies for the privilege of doing business in the State, is not a regulation of commerce. A tax on coal mined in the State, and transported to any place in the State or elsewhere for sale, is a regulation of commerce.5 So a tax on all ores mined in the State and exported before smelting, and exempting all ores smelted in the State, regulates commerce, and is void. 6

Conclusions. That while a State may tax all persons and property within its limits, and has complete control over its internal commerce, and may tax in its discretion the instruments of commerce, and its subjects, whether freight or passengers, yet whenever the commerce is between the States, or with foreign nations, the power of Congress when exercised is exclusive. And although the power has not been exercised directly, if the subjects over which the State

'Id. 293-295.

The Thame; Bank v. Lowell et al. 18 Conn. 500.

2 Id. 299.

4 Paul v. Virginia, 8 Wall. 168; Ducat v. Chicago, 10 Wall. 410; Liverpool Insurance Co. v. Massachusetts, Id. 566.

5 State v.

Cumberland R. R. Co. 40 Md. 22.

Jackson Mining Co. v. The Auditor General, 32 Mich. 488.