a manufacturing company, so as to render the pipes, the apparatus of gates, shut-offs, cocks and faucets, which it uses to conduct and distribute water in a town, taxable as machinery, although in the gatehouse adjoining the pond from which the water is taken, there are chambers and passages fitted with filters and screens to purify the water and keep it free from foreign substances.1

By statute, "the personal property of every company, firm, and body politic or corporate, shall be listed by the president or principal accounting officer, partner or agent thereof." The Pomeroy Salt Company, and a number of other incorporated companies, were engaged in the manufacture of salt in West Virginia. These companies united in the formation of an unincorporated company, The Ohio Salt River Company, and they are its sole members. The latter company bought a large number of boats, barges, &c., in its own name, to be used in the shipment of salt by the members of the company, appointed agents at Louisville, Cincinnati and St. Louis, to whom the salt was shipped, and by whom it was sold. These sub-agents made monthly returns to the managing agent at the home office. The proceeds of sale were divided pro rata according to the number of bushels shipped by each, after payment of expenses. All purchases and contracts were made by the company. The members individually had no control over property used by the company. Notes were executed by it in its own name, and were taken and indorsed in the same way. The boats, barges, &c., were held to be properly listed and taxed in its name in the district of its home office, where the managing agent resides. It was considered such a company as contemplated by the statute.?

But where persons associate themselves together to hold property and carry on business without being incorporated, although they may agree that the share or interest of each shall be transferable, they are to be taxed as copartners, each for his interest therein, and not as owners of shares in a corporation.3

Deposit of Insurance Companies.-The deposits of securities made with the treasurer or other officer of the State where the corporation is doing business, are liable to taxation as personal estate of the corporation. So under a general law taxing personal estate, the surplus fund of a corporation invested in mortgages and stocks is liable

1 Dudley v. Jamaica Pond Aqueduct Corp. 100 Mass. 183.

* Pomeroy Salt Co. v. Davis, 21 Ohio, N. S. 555.

3 Hoadly & Co. v. Com'rs, 105 Mass. 526.

4 State v. Haight, 35 N. J. Law (6 Vroom), 279.

to tax, although the dividends of the corporation are also taxed, unless there is a clear intent in the act imposing tax on the dividends to exempt the corporation from all other tax.1

In Missouri, railroad companies are required to give to the auditor a statement of all their property, giving location and length in each county by miles. The whole property is then valued, and apportioned to each county according to the number of miles of road in the county, and this amount thus ascertained is taxable in the county. A similar mode has been adopted in Kansas, and it is not considered as violating the provision in the Constitution as to uniformity of taxation.3

The legislature may direct the appraisal, in fixing the value of the property of railroads, to include all rolling stock, also to regard, in valuing its real estate, the location of the road for business, its net earnings, future prospects, and competition with other roads. Such an act does not conflict with the Constitution, which requires a just valuation of property, but does not require a uniform method of valuation.1

At one time in Illinois, the track and superstructure of railroads were denominated "fixed and stationary personal property," and for non-payment of taxes the rails could be levied on and removed." Subsequently the rolling stock was directed to be listed in the proportion which the length of the main track in each county bore to the length of the whole track. In ascertaining the whole length of the main track, a road leased by a railway company could be included, but not one on which its cars only ran occasionally, under a license." When the stock of a railroad is taxed, the fact that a part of the road is equipped and operated by a foreign company, does not prevent its being taxed; the stock is that of the home company.

On a mandamus against a railroad, to compel the payment of the tax thereon, it is not a good return, that it has leased its road, providing that the entire rents and profits should go to creditors and corporators.8 Mandamus, is the proper remedy when the tax is payable directly to the treasurer.9

1 Easton Bridge v. Northampton County, 9 Penn. St. 415.

State v. Severance, 55 Mo. 378.

Missouri River, Fort Scott & Gulf R. R. Co. v. Morris, 7 Kansas, 210. 4 Louisville, New Albany & Chicago R. R. Co. v. State, 25 Ind. 888.

› Maus v. Logansport & Peoria R. R. Co. 27 Ill. 34.

• Cook Co. v. Chicago B. &c. R. R. Co. 35 Ill. 460.

'Michigan Cent. R. R. Co. v. Porter, 17 Ind. 380.

The Constitution of Illinois requires taxation to be uniform and by valuation so that every person or corporation shall pay a tax in proportion to the value of his, her or its property. In 1872, a new system of taxing railroads was adopted, similar to that in Missouri. The officials were required to make each year detailed statements of all the property, owned by the road, and its situation and value, also the number of shares of capital stock and its value, and the amount of indebtedness of the road.

The right of way of the road, including all superstructures on the main and side tracks and turnouts, are deemed real estate, and denominated "railroad track;" all movable property belonging to the road is deemed personal estate and denominated "rolling stock." This property known as railroad track and rolling stock, is listed in each county or village, in the proportion which the length of the track in such village bears to the length of the whole road, whether owned or leased by it. All real estate other than that known as railroad track, the tools and materials for repair, and any personal property other than that known as rolling stock, is listed and taxed according to value, where they are situated. In addition, the board of equalization were authorized to ascertain the fair cash value of the capital stock of corporations, and a tax was laid on this. The board, in carrying out this law, added the fair cash value of the shares of stock, to the cash value of the indebtedness of the company; from this sum they deducted the aggregate value of the tangible property of the company, and the balance was taken as the fair cash value of the capital stock, including the franchise of the company. The taxation of the property of the road in each county, in the proportion that its length in the county bears to the whole length, while a different mode from that adopted as to individuals, was considered not to violate the principle of uniformity; it is uniform as to the class upon which it operates. The tax on the capital stock is a tax on the franchise of the road, the price paid by the road for its existence, and the mode of ascertaining that value was not considered as inequitable. Indeed, it was thought that as it was based, to some extent, upon the opinion of those who held the securities which were liens. on the road, it was one of the fairest modes of ascertaining the real value of the franchise.1

1 State Railroad Tax Cases, 2 Otto, 575, affirming the opinion of the Court of Appeals of Illinois, in Porter v. Rockford, &c. R. R. Co. at January term, 1874, and The Chicago, Burlington, &c. v. Cole, &c. at June term, 1875. See ante, § 54, and State v. South Carolina R. R. Co. 4 S. C. 376, where a similar tax was declared void, as not being uniform.

In the celebrated Credit Mobilier, the question was whether property was to be taxed to the corporation or to the individuals interested therein. Oakes Ames owned a construction contract with the Union Pacific Railroad Company. He entered into a tripartite agreement, in which he was party of the first part, seven trustees parties of the second part, and the Credit Mobilier a corporation of Pennsylvania, party of the third part. The trustees agreed to build the road, receive the price, and pay over the surplus profits to the persons who were stockholders in the Credit Mobilier in proportion to their stock. The Credit Mobilier agreed to furnish the funds to construct the road,, at seven per cent. interest. Ames then assigned his construction contract to the trustees, and agreed that they should receive the price of construction, and pay the profits to the stockholders as stated in the agreement. The trustees paid in cash and securities nine millions. of dollars to stockholders as profits, between October, 1867, and the 3d of July, 1868. The State claimed a tax on the capital of the Credit Mobilier measured by the dividends for the year 1868. The court held that the contract for construction was not that of the corporation, nor did the profits belong to it; that the corporation was not liable to the tax; and that Oakes Ames, the trustees and the stockholders were partners in the transaction, and each personally liable to be taxed for his interest in the contract.1

1 Credit Mobilier v. Commonwealth, 67 Penn. St. 233.

13

CHAPTER XI.

THE LEVY AND ASSESSMENT OF THE TAX.

§ 91. The Levy of the Tax.-No tax can be levied without the authority of the legislature of the State. The power to tax is vested in this branch of the government, and this power is exercised either directly by the legislature, or indirectly, as in the cases where it is delegated to subordinate political divisions of the State, such as counties or cities.

In most of the States, certain amounts of money are appropriated to specified objects, and to raise the amount necessary for the various objects, a tax bill is enacted. This bill fixes the amount of specific tax to be paid by each person on his head or poll, the amounts to be paid for license for the privilege of pursuing various occupations, the rate on each hundred dollars worth of real or personal estate, and upon incomes, legacies, &c. This is the levy of the tax, or the imposition of the rate of tax on property, or income, and the specific taxes on other subjects; for this there must be legislative authority.1 The assessors then ascertain the persons who are to pay the specific taxes, or who are to be taxed for real or personal property according to value. Usually the same officers perform this duty for the State, the county and the township. When the value of the property is ascertained, the rate or percentage fixed by the tax bill is extended in the column for State taxes, the rate fixed by the supervisors of the county is extended in the column for the county tax, and the rate fixed by the township board is extended in the column for the township taxes.

In other States, as New York, Michigan and Wisconsin, the legislature appropriates the sum to be raised, for State purposes, the supervisors of the counties report to the auditor of the State, or some similar officer, the value of the real and personal estate in their

1 Cooley on Const. Limitations, p. 517. The question is well discussed in the late case of Morton v. Comptroller General, 4 S. Car. 430, in which it is held, that the legislature must impose the tax on the tax-payers as a collective body, but the apportionment of the amount to be raised, so that each individual may know his share of burden, may be delegated to a ministerial officer where the data for the confputation are furnished by the tax act.