U. S, Supreme Court Okehs California Tax Laws on Gasoline-Motor Vehicles
◂◂◂◂◂◂ THE UNITED States Supreme Court on November 25, 1929, handed down a decision upholding the legality of California’s gasoline tax laws. The decision, which was rendered by Justice McReynolds. was as follows:
By acts approved July 11, 1916, chapter 211, 39 Stat. 355, and November 9. 1921. chapter 119, 42 Stat. 212 (23 USCA § 1 et seq.). Congress provided for aid to the states in roadmaking and directed that “all highways constructed or reconstructed under the provisions of this act shall be free from tolls of all kinds.” 23 USCA § 9. California assented to the provisions of these acts and under them received large sums of money from the United States.
By the motor vehicle fuel tax statutes, chapter 267, Acts 1923, chapter 359, Acts 1925, and chapters 716, 795, Acts 1927, the California Legislature defined motor vehicle fuel, and directed that all distributors of it should be licensed and pay taxes to the controller of the state, amounting to three cents per gallon sold, less an allowance of 1 per centum. These statutes further provide for reimbursing purchasers of fuel not used for operating vehicles upon public highways.
Appellants, along with thousands of other citizens and taxpayers of California, operate motor vehicles along the highways. They have procured and must hereafter procure the necessary fuel from licensed distributors at prices enhanced by the amount of the three-cent tax.
The original bill, filed in the District Court of the United States, August 4, 192S, names as the only defendant the State Controller—the officer charged with the duty of enforcing the motor vehicle fuel tax statutes. It proceeds upon the theory that those statutes, under the form of taxing dealers from whom appellants and all other operators of motor vehicles must buy, in effect exact tolls for the use of the highways, also grant certain favors to the distributors, and deprive all such purchasers of their property without due process of law. Therefore, it is said, they conflict with the Fourteenth Amendment, the Federal Highway Acts, and the Constitution of California. The prayer is for a decree declaring their invalidity and for an injunction restraining defendant from attempting to enforce them, etc.
In the court below—three judges sitting—the bill was dismissed, without written opinion.
(1) Appellants may not undertake to test the validity of the questioned acts by a proceeding of this character. Frothnqham vs. Mellon., Sec’y of the Treasury, 262 U. S. 447, 4S7, 4S8, 43 S. Ct. 597, 601, 67 L. Ed. 1078, announces the applicable doctrine:
“The administration of any statute, likely to produce additional taxation to be imposed upon a vast number of taxpayers, the extent of whose several liability is indefinite and constantly changing, is essentially a matter of public and not of individual concern.”
The Federal courts have no power per se to review and annul acts of state legislatures upon the ground that they conflict with the Federal or state constitution. “That question may be considered only when the justification for some direct injury suffered or threatened, presenting a justifiable issue, is made to rest upon such an act.”
The decree below is affirmed.
The Chief Justice, Mr. Justice Van Devanter and Mr. Justice Butler are of opinion that the appellants’ status is such as entitles them to test the validity of the California statutes in question; that these statutes do not exact tolls for the use of highways within the meaning of the limitation contained in the Federal Highway Acts, and are not subject to the other objections urged against them: and that for these reasons the decree below should be affirmed.
TRANSPORTATION TAX UPHELD
On the same day the Supreme Court of the United States also upheld the legality of the tax imposed by California on carriers by motor vehicles over regular routes. In this decision the Supreme Court held that “A state statute imposing upon common carriers engaged in transporting freight by motor vehicles along public highways between fixed termini and over regular routes a tax of 5 per cent of their gross receipts, in lieu of all other taxes, is not unconstitutional as class legislation, though other freight carriers, common and private, by motor vehicles, are subjected to different and less burdensome taxation.”
TEXT OF DECISION
The decision in full follows:
Appellants, as common carriers, are engaged in transporting freight by motor vehicles for hire along public highways between fixed termini and over regular routes within California. The 1926 amendment to the constitution and the statutes of that state lay upon such carriers a tax of 5 per cent of their gross receipts in lieu of all other taxes, while other freight carriers, common and private, by motor vehicles, are subjected to different and, it is alleged, less burdensome taxation. Cal. Const, art 13, § 15; March 5, 1927, chap. 19, 1927 Cal. Stat.
By this proceeding, instituted July 21, 1928, appellants ask that the constitutional amendment and the statute which undertake to lay such tax upon them be declared discriminatory and in conflict with section 1 of the fourteenth amendment: also, that an injunction issue against the State Comptroller, forbidding him from attempting to enforce payment.
Upon motion, without written opinion, the district court—three judges sitting—dismissed the bill. The
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