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condition precedent to the transaction of interstate business. And, furthermore, if the tax, whatever its name, amounts to more than an ordinary tax upon the property of the company doing both an interstate and domestic business, it will be held void. In Postal Telegraph Cable Co. v. Adams57 the court say: "Property in a State belonging to a corporation, whether foreign or domestic, engaged in foreign or interstate commerce, may be taxed, or a tax may be imposed on the corporation on account of its property within a State, and may take the form of a tax for the privilege of exercising its franchises within the State, if the ascertainment of the amount is made dependent in fact on the value of its property situated within the State (the exaction, therefore, not being susceptible of exceeding the sum which might be leviable directly thereon), and if payment be not made a condition precedent to the right to carry on the business, but its enforcement left to the ordinary means devised for the collection of taxes. The corporation is thus made to bear its proper proportion of the burdens of government under whose protection it conducts its operations, while interstate commerce is not in itself subjected to restraint or impediment."

The exaction by a city of a tax on the poles of a telegraph company, doing an interstate commerce business, has been held to be not a license tax on the interstate commerce, but a rental for the use by the company of the city streets.58 Such a tax, however, the court point out, may not be unreasonable in amount.59

§ 328. Taxation of Foreign Corporations.

The property of foreign corporations may be taxed as such by the State in which the property is situated. It may indeed be subjected to a heavier tax than other like property in the State, if the State see fit to attach this as a condition to the permission granted

57 155 U. S. 688; 15 Sup. Ct. Rep. 268; 39 L. ed. 311.

58 St. Louis v. Western Union Tel. Co., 148 U. S. 92; 13 Sup. Ct. Rep. 485; 37 L. ed. 380.

59 Cf. W U. Tel. Co. v. Borough of New Hope (187 U. S. 419; 23 Sup. Ct. Rep. 204; 47 L. ed. 240), in which it was held that an ordinance imposing.a license fee on telegraph poles was not void because it yielded a return in excess of amount necessary to meet the cost of supervision and inspection.

to the corporation to do business within the State. In such case, however, the tax is not in reality a property, but a license tax. Ordinarily, however, taxes, other than the ordinary property taxes, imposed on foreign corporations are explicitly in the nature of license taxes. Such license taxes may, however, be imposed only in case the corporations may fairly be said to be "doing business" within the State. This is a fact which the courts, when appealed to, must determine in each case. It may be said, generally, however, that a corporation cannot be said to be "doing business" in the State unless it has established a trade domicile of some sort, that is, established a branch office, or created a sales agency, a factory, or a distributing warehouse.

If, however, the foreign corporation be a carrier carrying on interstate commerce, as for example, a railroad, or telegraph, or telephone company, it may establish offices, or other agencies for the transaction of its business within the State, free from liability to a license tax or other burden or restraint by the State. Thus, in McCall v. California a state law was held void under which it was attempted to collect a license tax upon agents soliciting passenger business for certain interstate railroads.61

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The sending by a foreign corporation of agents through the State for the purpose of taking orders for goods, which goods are to be later shipped into the State, is an interstate commerce transaction, and does not constitute doing business in the State, so that a license tax may be imposed.62

§ 329. State Tax Law Must Not Discriminate Against Products of Other States, or Against Companies Doing an Interstate Commerce Business.

Tax laws, or, indeed, any other laws of a State discriminating against non-resident traders or against the products of other States are void as interfering with interstate commerce.

60 136 U. S. 104; 10 Sup. Ct. Rep. 881; 34 L. ed. 391.

61 Three justices dissented in this case upon the ground that the interference with interstate commerce was not sufficiently direct to bring it within the operation of the Commerce Clause.

62 See post, Section 330.

63

In Ward v. Maryland 3 the court held void a state law by which persons not permanent residents in the State were prohibited from selling or offering for sale within a certain district of the State, any goods whatsoever other than agricultural products and articles manufactured in the State.

In Welton v. Missouri the same doctrine was declared, the court saying: "The commercial power continues until the commodity has ceased to be the subject of discriminating legislation by reason of its foreign character. That power protects it even after it has entered the State, from any burdens imposed by reason of its foreign origin."

65

In Guy v. Baltimore was adjudged invalid a municipal ordinance establishing certain wharfage rates to be paid by vessels carrying goods other than the productions of the State, the court, after a review of the authorities, saying: "In view of these and other decisions of this court, it must be regarded as settled that no State can, consistently with the federal Constitution, impose upon the products of other States, brought therein for sale or use, or upon citizens because engaged in the sale therein, or the transportation thereto, of the products of other States, more onerous public burdens or taxes than it imposes upon the like products of its own territory."

66

In Webber v. Virginia a state license law was again held invalid because dependent upon the foreign character of the articles dealt with. "If," the court say, "by reason of their foreign character, the State can impose a tax upon them or upon the person through whom the sales are effected, the amount of the tax will be a matter resting in her discretion. She may place the tax at so high a figure as to exclude the introduction of the foreign article and prevent competition with the home product. It was against legislation of this discriminating kind that the framers of the Constitution intended to guard when they vested in Congress the power to regulate commerce among the several States."

63 12 Wall. 418; 20 L. ed. 449. 61 91 U S. 275; 23 L. ed. 347. 63 100 U. S. 434; 25 L. ed. 743. 66 103 U. S. 334; 26 L. ed. 565.

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In Walling v. Michigan was held void, because discriminative, a state law which imposed a specific tax on persons, not having their principal place of business in the State, engaged in selling liquors at wholesale, or in soliciting or taking orders for such liquors to be shipped into the State from outside the State, without imposing a similar tax upon persons engaged in the selling of liquors manufactured in the State.

68

In Darnell & Son Co. v. Memphis the authorities are carefully reviewed, a law of Tennessee being held void which, while imposing a tax on the products of the soil of other States, exempted those produced from its own soil.

§ 330. Drummers.

The leading case establishing the doctrine that the negotiation by sales-agents of sales of goods which are in another State for the purpose of introducing them into the State where the nego tiation is had, is interstate commerce and not subject to regulation or taxation by the State, is Robbins v. Taxing District of Shelby Co.69

In Asher v. Texas, 70 and Brennan v. Titusville" the same doctrine is declared.

In Ficklen v. Shelby Co.72 the doctrine is again asserted but declared not applicable to a license tax imposed upon a citizen doing a general commission business, though he was able to show that during the year for which he resisted the payment of the tax his commissions were wholly derived from interstate business, that is, orders taken for goods to be shipped into the State. The court argued that this was an adventitious circumstance and that having taken out a license to do a general commission business, and agreed to pay a certain percentage thereon, the tax was to be construed as a general license tax and not one on interstate 67 116 U. S. 446; 6 Sup. Ct. Rep. 454; 29 L. ed. 691. 68 208 U. S. 113; 28 Sup. Ct. Rep. 247; 52 L. ed. 413. 69 120 U. S. 489; 7 Sup. Ct. Rep. 592; 30 L. ed. 694. 70 128 U. S. 129; 9 Sup. Ct. Rep. 1; 32 L. ed. 368. 71 153 U. S. 289; 14 Sup. Ct. Rep. 829; 38 L. ed. 719. 72 145 U. S. 1; 12 Sup. Ct. Rep. 810; 36 L. ed. 601.

business. In a later case, the court, however, recognized that this case was on the boundary line of the States' power.

74

73

In Stockard v. Morgan a privilege tax imposed by a State upon merchant brokers whose business was exclusively confined to soliciting orders from jobbers and wholesale dealers within the State, as agent for non-resident parties, for goods to be shipped into the State by such parties, was held void as laying a burden upon interstate commerce.75

In Caldwell v. North Carolina76 it was contended by the State that a tax levied by it for selling pictures therein was valid because, though the contract of sale was made outside the State, the pictures and frames when sent into the State were unboxed by 73 Brennan v. Titusville, 153 U. S. 289; 14 Sup. Ct. Rep. 829; 38 L. ed. 719. 74 185 U. S. 27; 22 Sup. Ct. Rep. 576; 46 L. ed. 785. 75 After quoting from the Ficklin case, the court say: "From these extracts from the opinion it is seen that a material fact in the case was that Ficklin had taken out a general and unrestricted license to do business as a broker, and he was thereby authorized to do any and all kinds of commission business, and therefore became liable to pay the privilege tax exacted. Although Ficklin's principals happened in the year 1887 to be wholly non-residents, the fact might have been otherwise, as was stated by the Chief Justice, because his business was not confined to transactions for non-residents. In this case the complainants did not represent or assume to represent any residents of the State of Tennessee, and each of the complainants represented only certain specific parties, firms, or corporations, all of whom were nonresidents of Tennessee. They did no business for a general public. We attach no importance to the fact that in the Robbins case the individual taxed resided outside of the State. He was taxed by reason of his business or occupation while within it, and the tax was held to be a tax upon interstate commerce. Nor does the fact that the complainants acted for more than one person residing outside of the State affect the question. If while so acting and soliciting orders within the State for the sale of property for one nonresident of the State, the person so soliciting was exempt from taxation on account of that business, because the tax would be upon interstate commerce, we do not see how he could become liable for such tax because he did business for more than one individual, firm, or corporation, all being non-residents of the State of Tennessee. The fact that the State or the court may call the business of an individual, when employed by more than one person outside of the State, to sell their merchandise, upon commission, a 'brokerage business,' gives no authority to the State to tax such a business as complainants'. The name does not alter the character of the transaction, nor prevent the tax thus laid from being a tax upon interstate commerce."

76 187 U. S. 622; 23 Sup. Ct. Rep. 229; 47 L. ed. 336.

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