which business shall be taxed are also in the legislative discretion. The taxes which are most customary are: 1. On the privilege of carrying on the business. 2. On the amount of business done. 3. On the gross profits of the business. 4. On the net profits or profits divided. But the tax may be measured by other standards prescribed for the purpose as well as by these. The follow ing of one of the ordinary employments of life is not to be regarded as a privilege unless expressly made so by statute; and authority conferred by a municipal charter to tax privileges could not, therefore, without further designation, be held to embrace such employments. And when employments are expressly permitted to be taxed as privileges, the burden is usually restricted to those which in some particular are exceptional, either because they are thought to be specially profitable, or because they require special regulations, or because the privilege is in the nature of a franchise, or because they supply a general demand, so that the burden imposed will those planters who granulate syrup for other planters during the rolling season," the discrimination made being based on a reasonable distinction in principle. American Sugar Refining Co. v. Louisiana, 179 U. S. 89, 45 L. Ed. 102. the right to manufacture or produce, and it is at least a question for the legislature to determine whether any. thing done to prepare a product most perfectly for the needs of the market shall not be treated as an incident to its growth or production. The act is not one exempting planters who use their sugar in the manufacture of articles of a wholly different description, such as confectionery, preserves, or pastry, or such as one which should exempt the farmer who devoted his corn or rye to the making of whisky, while other manufacturers of these articles were subjected to a tax. A somewhat different question might arise in such case, since none of these articles are the natural products of the farm, such products only becom favoritism, and a denial of the equal ing useful by being commingled with Such statute "does undoubtedly discriminate in favor of a certain class of refiners, but this discrimination, if founded upon a reasonable distinction in principle, is valid. Of course, if such discrimination were purely arbitrary, oppressive, or capricious, and made to depend upon differences of color, race, nativity, religious opinions, political affiliations, or other considerations having no possible connection with the duties of citizens as taxpayers, such exemption would be pure protection of the laws to the less favored classes. But from time out of mind it has been the policy of this government, not only to classify for purposes of taxation, but to exempt producers from the taxation of the methods employed by them to put their products upon the market. The right to sell is clearly an incident to various other ingredients. Refined sugar, how- product to the original American Sugar Refining Co. v. Louisiana, 179 U. S. 89, 45 L. Ed. 102. be generally distributed. But no employment is absolutely exempt from the liability to be taxed. The necessities of the government may require that the lowest employment as well as the most lucrative shall contribute to its support, and if any is exempted, motives of policy will govern the discrimination. When the tax takes the form of a tax on the privilege of following an employment, convenience in collection will commonly dictate the requirement of a license, and the person taxed will be compelled to pay the tax as a condition to the right to carry on the business at all. In such a case the business carried on without a license will be illegal, and no recovery can be had upon contracts made in the course of it. This distinguishes such a case from one of neglect to pay taxes in general; for except where payment is thus made a condition to the right to transact business, a default therein cannot affect the validity of business transactions. But license and tax do not necessarily go together; a license may be required when no tax is imposed, and an unconditional license does not exempt the licensee from being taxed upon the privilege it gives him. In this particular all valuable privileges stand upon the same footing; they are all liable to taxation at the will of the state, unless the state has bargained to exempt them. As is said in one case, 'there is a clear distinction recognized between a license granted or required as a condition precedent, before a certain thing can be done, and a tax assessed on the business which that license may authorize one to engage in. A license is a right granted by some competent authority to do an act which, without such authority, would be illegal. A tax is a rate or sum of money assessed upon the person, property, etc., of the citizen.' 69 The privilege obtained by the license may therefore be taxed in consideration of the property value it possesses, and this not only by the state directly, but by the county and town also, if proper authority has been conferred upon them for the purpose; but where one is licensed by the state to carry on any particular business he cannot, without legislation expressly permitting it, be compelled by a county, city, or town to take out a further license as a condition of doing business in such municipality. It is generally held that occupation taxes must be uniform upon the same class of subjects. It is also held that license laws cannot be extended by construction, that omissions cannot be supplied by the courts, and that no license-tax can be exacted which is not imposed by the 69 The distinction here indicated is, terms "occupation tax" and "lilike other distinctions, often ignored cense" indiscriminately. by the courts, in that they use the words of the statute or ordinance. The general rule that to be construed with the powers of a municipal corporation are strictness is peculiarly applicable to the case of taxes on occupations, and the authorities concur in holding that if it is not manifest that there has been a purpose by the legislature to give authority for collecting a revenue by taxes on specified occupations, any exaction for that purpose will be illegal. If a minimum tax is prescribed by statute, one measured by the business, and which may exceed the sum named, is unauthorized and void; but where a discretionary power is conferred, its exercise will not be interfered with, unless it clearly appears to have been abused; and if a city has power to require a license, it may, generally speaking, fix within reasonable limits the amount of the fee or tax." 70 More particularly on the subject of licenses, Judge Cooley, after discussing generally taxes under the police power, says: "License fees may be imposed: 1. For regulation. 2. For revenue. give monopolies.71 4. For prohibition. 3. To In general * when license fees or similar burdens are imposed the state has in view either the regulation of that in respect of which the exaction is made, or it contemplates a revenue therefrom; or it may intend both regulation and revenue. The requirement of a license fee, as a condition to carrying on an occupation requiring regulation, cannot be objected to as a restraint of trade, however necessary may be the employment; and the legislature must be the judge when regulation is needful. A license is a privilege granted by the state, usually on payment of a valuable consideration, though this is not essential. To constitute a privilege the grant must confer authority to do something which without the grant would be illegal; for if what is to be done under the license is open to every one without it, the grant would be merely idle and nugatory, conferring no privilege whatever. But the thing to be done may be something lawful in itself, and only prohibited for the pur poses of the license; that is to say, prohibited in order to compel the taking out of a license. This is always the case where that which is licensed was not unlawful at the common law. The grant of a license may be made by the state directly, or it may be made indi rectly through one of the municipal corporations of the state. Of the indirect grant it is to be observed that a municipal corporation as such has no inherent power to grant licenses or exact license fees; it must derive all its authority in this regard from the state, and the power must come by direct grant and cannot be taken by implication." Such, then, are the general principles and rules which underlie the law of privilege taxes and licenses. Of the fact that private corporations, equally with natural persons, are subject to the operation of this law, there can be no doubt. In other words, a private corporation is not, on account of its artificial character, immune from the requirements that it take out a license as a condition precedent to its right to carry on its business, and that it pay a privilege tax on such business. It is a general rule, and a rule which in some of the states has been given statutory form, that the word "person" as used in legislation may be construed to embrace a private corporation whenever such construction is necessary in order for the legislation to have its intended effect.72 Hence it is not necessary that a privilege-tax or license statute or ordinance include corporations within its terms eo nomine in order for it to be held that such "persons" come within its operation.73 Nor does the grant of a corporate charter whereby the corporation is authorized to carry on a certain business import that it may engage therein without contributing to the sup 72 § 54, supra. 73 In some states, at least, corporations are regarded as persons within the meaning of the liquor license laws. Connecticut. Connecticut Breweries Co. v. Murphy, 81 Conn. 145, 70 Atl. 450. Delaware. In re D. W. Lynch Co., 24 Del. 104, 75 Atl. 41. Idaho. Ada County v. Boise Commercial Club, 20 Idaho 421, 38 L. R. A. (N. S.) 101, 118 Pac. 1086. Illinois. People v. Heidelberg Garden Co., 233 Ill. 290, 84 N. E. 230. Maryland. Conococheague Club of Washington County v. State, 116 Ma. 317, 81 Atl. 602. Minnesota. State V. Minnesota Club, 106 Minn. 515, 20 L. R. A. (N. S.) 1101, 119 N. W. 494. South Dakota. State v. Mudie, 22 S. D. 41, 115 N. W. 107. Compare State v. St. Louis Club, 125 Mo. 308, 26 L. R. A. 573, 28 S. W. 604. See also State v. Robinson, 163 Mo. App. 221, 146 S. W. 456. In a Maryland case it was held that a corporation was a person within the meaning of the Maryland statute imposing a license tax on persons keeping billiard tables. The Germania v. State, 7 Md. 1. A corporation is a person within the meaning of the English Hawkers' Act, and may be proceeded against when it carries on the business of hawking without having procured the required license. Co-operative Drapery & Furnishing Soc., Ltd. v. Bligh, 39 Scot. L. Rep. 500. port of the government by the payment of a privilege-tax. So, in a case decided by the Federal Supreme Court, it was held that an exemption of a gas light company from the payment of a license tax cannot be read into the company's charter, which does not expressly grant such an exemption, merely because to permit the state to impose such a tax would be to destroy the privilege granted by the charter.75 § 4652. Incorporation and stock-increase fees. As is stated in an earlier chapter of this work,76 a fee for the filing of the articles or certificate of incorporation is generally required to be paid to the secretary of state or other officer in whose office the filing is done.77 Under the statutes of some of the states, the payment of such fee is a condition precedent to corporate existence. So, under the Maryland statute, which prohibits the having or exercising of any cor porate powers before payment of the bonus tax imposed, a corporation has no capacity to sue and cannot be sued (except by the state for the recovery of the tax as authorized by the statute) until it has paid such tax, and the defendant in a suit brought by it may defend on the ground of its incapacity. Nor will payment of the tax after the bringing of the suit be effective to prevent the dismissal of the bill.78 Under the Alabama statute, however, the failure to pay the fee does not, of itself, prevent the corporation from having a de facto existence, nor render the stockholders who have acted in good faith liable as partners.79 But, condition precedent or not, payment of the fee cannot be avoided by subterfuge. So, a constitutional provision that no corporation other than one formed for 1 |