employed outside the State. Thus where a domestic railroad company owned cars which were sometimes within and sometimes outside the State, it was held by a majority of the court that the whole value of the cars was capital employed within the State.305 Haight, J., said: "True, the cars are transferred onto other roads, and are run outside of the state, for the purpose of facilitating the transportation of persons and freight without change of cars or of breaking bulk; but the use of the cars outside of the state is but temporary, for they are returned as soon as reloaded, and are again used in the transportation of persons and property within this state. It seems to me, therefore, that, under a fair and reasonable construction of the statute, this item should have been included as capital employed within this state." 306 This decision is by its terms applied only to the case of a domestic corporation. How the court will deal with the case of a foreign corporation remains to be seen; but there would seem to be no tenable ground for distinction. It is clear that rolling stock permanently employed outside the State cannot form part of the capital invested in business within the State.307 $545. North Carolina. Both the State and local taxing districts impose an ad 305 P. v. Knight, 173 N. Y. 255, 65 N. E. 1102. 306 There was a vigorous dissent. O'Brien, J., held that it was proper to include as capital employed within the State only a part of the value of the cars, in proportion to the length of road within and outside the State. He said: "It is obvious that since the relator is a great interstate railroad, traversing the continent, a large proportion, or at least some, of its rolling stock must be always employed outside of the state. It may be that the situs of all the relator's property is in the state of its creation, but, as already remarked, the question is not where the situs is, but where the property is employed. It may be that various states through which the relator's railroad is operated impose taxes upon such part of its property as upon the basis adopted here is found to be employed in these states, respectively; so we think that the learned court below was correct in excluding this item from the estimate of the relator's property employed within this State." 307 P. v. Campbell, 88 Hun, 544, 34 N. Y. S. 801. valorem tax on the property of a corporation; certain corporations pay a local license tax; and all corporations pay a franchise tax to the State. The property tax is governed by the following provisions as to rate: "There shall be levied and collected annually an ad valorem tax of twenty-one cents for State purposes, four cents for pensions, and eighteen cents for public schools—making fortythree cents on every one hundred dollars value of real and personal property in this State required to be listed in 'An Act to provide for the assessment of property and collection of taxes,' subject to exemption made by law, and no city or other municipal corporation shall have power to impose, levy or collect any greater sum on real and personal property than one per centum of the value thereof, except by special authority from the General Assembly." "7 308 All exemptions from taxation contained in charters or former laws are repealed.309 An annual report in writing must be made by domestic corporations, showing the authorized capital stock, the number and par value of shares issued, the amount paid into the Treasury, the amount of dividends paid, and the highest, lowest and average price of shares during the year; together with an official estimate of the value of the capital stock, which may be revised by the Auditor and State Treasurer, subject to appeal. Corporations liable to tax on capital stock shall not be required to pay any further State tax on the mortgages, bonds, or other securities owned by them in their own right. The Corporation Commission, the Treasurer and the Auditor are forbidden to divulge or make public any report of a corporation required to be made to them or either of them by this section. The auditor shall prepare and keep a record book upon which he shall enter a corporate list of all the corpora 308 N. Car. Revenue Laws of 1903, § 3. 309 Ibid. § 5. tions and banks which he has assessed for taxation, and said. record shall show the assessed valuation placed upon same by him.310 "Every corporation, joint stock association, limited partnership or company whatsoever from which a report is required under the sixth section hereof, shall be subject to and pay to the State Treasurer annually a tax as prescribed in section three upon each one hundred dollars of the actual value of its whole capital stock of all kinds, including common, special and preferred, as ascertained in the manner prescribed by law. . . . Provided, that for the purposes of this act, interests in limited partnerships or joint stock associations shall be deemed to be capital stock and taxable accordingly: Provided, also, that corporations, limited partnerships and joint stock associations, liable to tax on capital stock under this section, shall not be required to make any report or pay any further tax on mortgages, bonds, other securities and credits owned by them in their own right; but corporations, limited partnerships and joint stock associations, holding such securities as trustees, executors, administrators, guardians, or in any other manner, shall return and pay the tax imposed by this act upon all securities so held by them, as in the case of individuals. Individual stockholders in any corporation, joint stock association, limited partnership or company paying a tax on its capital stock under this section shall not be required to pay any tax on said stock or list the same." 311 This tax applies to foreign corporations doing business in the State, as well as to domestic corporations.312 Nothing in this act shall be construed to exempt from taxation at its real value any property situate in this State belonging to any foreign corporation.313 All building and loan associations organized in North Caro 310 N. Car. Machinery Act of 1903, § 34. 311 N. Car. Revenue Law of 1903, § 4. 312 State v. Armour Packing Co., (N. C.) 47 S. E. 411. 313 N. Car. Machinery Act of 1903, § 36. lina "shall list for taxation on the first Monday in June of each year the shares of stock of such association at their actual value, as shown by the books of said association. He shall deduct from such valuation the actual value of the shares upon which said association has made loans, and which have been pledged to such association as security therefor. But it is expressly provided that the secretary of each association shall show in detail, or by series on the tax list, the actual value of all shares, and also the actual value of shares upon which loans have been made, and which have been pledged to the association as security therefor. The secretary of such association shall pay to the State Treasurer by the first day of July of each year the State tax, and to the Sheriff or Tax Collector of each county in which such association is located, the county and school tax by the fifteenth day of September of each year. No other tax or assessment shall be charged or levied on said association or the shares therein." 314 "All foreign building and loan associations doing business in this State shall list for taxation through its agent its stock held by citizens of this State, in the county, city or town where the owners of said stock reside. In listing said stock for taxation the withdrawal value as fixed by the by-laws of each company shall be furnished the list taker, and the stock shall be valued for taxation as other moneyed investments of citizens of this State. All of said taxes shall be paid by the association listing said stock." 315 A State license tax for the privilege of carrying on business within the State is exacted as follows: "On each and every corporation organized under the laws of this State or doing business in this State (railroads, banks, building and loan associations, insurance companies, telegraph companies, express companies and telephone companies excepted), an annual franchise tax in proportion to the amount of its capital stock, according to the following graduated scale, 314 Ibid. § 35. 315 Ibid. § 39. to-wit: On corporations having a capital stock paid in or subscribed of twenty-five thousand dollars or less, five dollars; over twenty-five thousand dollars and not exceeding fifty thousand dollars, ten dollars; over fifty thousand dollars and not exceeding one hundred thousand dollars, twenty-five dollars; over one hundred thousand dollars and not exceeding two hundred and fifty thousand dollars, fifty dollars; over two hundred and fifty thousand dollars and not exceeding five hundred thousand dollars, one hundred dollars; over five hundred thousand dollars and not exceeding one million dollars, two hundred dollars; over one million dollars, five hundred dollars. In addition to the penalties otherwise provided in this act, the failure for three consecutive years to pay the franchise tax by this section shall cause a forfeiture of the charter of such defaulting corporation, and its charter in that event shall be and the same is hereby repealed. If such defaulting corporation is a foreign corporation, its permission to do business in this State shall be revoked. No county, city or town shall have the power to levy any franchise tax under this section. Provided, that the payment of the tax imposed by this section shall not exempt any corporation from the payment of the license taxes levied under Schedule B of this act; Provided, further, that the tax provided for under this section shall be payable to the State Treasurer." 316 A license fee on mercantile corporations for the privilege of doing business in the State, is thus assessed: "Each vender of or dealer in goods, wares, merchandise, commodities or effects of whatsoever kind or nature, either retail or wholesale, except such business or trades as are specially mentioned by name in other sections of this schedule and which have a fixed annual license fee levied upon them, shall pay annually on the whole volume of gross sales according to the following schedule: On $50,000 or less, 40 cents on each $1,000, or fractional 316 N. Car. Revenue Act of 1903, § 81. |