In Re Johnston-Newton Co.

On further consideration, I am unwilling to concur in the views of the majority of the court as expressed in the opinions of Mr. Justice McDONALD.

Under section 4 of the 1921 law, every corporation subject to its provisions is required to pay "an annual fee," specified therein, on its paid-up capital and surplus at the time of filing its annual report. Section 7 provides that such report shall be filed during the *Page 43 months of July and August in each year, and shall contain certain data which will reveal the amount of its capital and surplus upon the 30th day of June next preceding. The tax provided for is a specific one, to be paid in advance each year, for the privilege of doing business in this State. The question presented is: When does the tax year begin? Or, in other words, For what period is the tax to be paid?

In my opinion, this should be determined from a consideration of the 1921 act alone. There is nothing in the amendment to indicate an intent to change the date of the beginning of the year for which the tax is to be paid. Had the question been raised before the act of 1921 was amended, how should it have been answered? Under the act, the tax is to be computed on the amount of the capital and surplus possessed by the corporation on the last day of June in each year. A report thereof may be filed and the amount of the tax ascertained and paid on the day following. This day, July 1st, in each year, is, in my opinion, the date when liability attaches. It is the beginning of the period for which the tax is to be paid. While the amount of the tax cannot be ascertained until the report is filed, the rate is fixed and a simple computation is all that is necessary to determine the amount. That collection may not be enforced until after August 31st is in no way controlling. It is not unusual in tax statutes to find such a provision. Under our general tax law, the tax becomes a liability on December 1st, when the tax roll is delivered to the treasurer, but payment may not be enforced, except in certain specified cases, until after the 10th day of January following. While different rules apply to the imposition of a property tax and a privilege tax, the latter is here based on a valuation of assets representative of property, and the provision for voluntary payment within a certain time should be construed as simply days of grace within which payment may *Page 44 be made as it is in the general tax law. In the construction of a statute we may consider the occasion and necessity of its enactment and the object intended to be accomplished by it. It is a well known fact that at that time the State was confronted with a very considerable deficit. The intent of the legislature was to remedy this condition. To do so, they imposed this tax, and must be presumed to have intended to make it due and payable at the earliest moment after the effective date of the act. It is also well known that the end of the fiscal year of most corporations is June 30th. The legislature therefore provided that the tax should be computed on the capital and surplus as they existed on that day. It would have been impracticable to require that all reports should be made on the day following. A reasonable time must be allowed to do so. The months of July and August were so allowed. The legislature in effect said to the corporations, "You have so much capital and surplus on June 30th. For the year after that date, you must pay a tax on this sum for the privilege of doing business in this State during that time." In fairness to the taxpayer, the year should begin immediately after June 30th. Otherwise, it may be required to make payment based on an amount of capital and surplus considerably different from that which it possesses at the time the tax-paying period begins. The intent to impose the tax for a particular year is apparent. No provision is made should there be a change in the amount of capital and surplus possessed on June 30th as shown by the report. Should a corporation become dissolved or go out of business during July or August, it must, under section 7 of the act, still file a report "showing its condition at the close of business upon the thirtieth day of June next preceding," and, as a condition precedent to the filing of the report, it must pay the tax for the succeeding year. *Page 45

If I am right in the conclusion reached that the year for which the 1923 tax must be paid began on July 1, 1923, then the tax became a liability on that day, subject only to ascertainment by computation of the amount when the report should be filed, and the amendment, although it became effective on August 30th, in no way affected such liability or released plaintiff therefrom.

The conclusion I have reached is in accord with the holding in New Jersey v. Anderson, 203 U.S. 483 (27 Sup. Ct. 137).

The writ should be dismissed.

CLARK, C.J., and BIRD, J., concurred with SHARPE, J.