I cannot agree with the conclusion reached in the opinion by Commissioner Teehee, approved by the majority of this court. In this action J.C. Taylor sought to enjoin the defendants, H.A. Brown, county treasurer of Stephens county, and N.C. Williams, delinquent personal tax collector of said county, from proceeding to collect, by a tax warrant, ad valorem taxes on an automobile owned by plaintiff, for the year 1924.
The majority opinion holds that the dealer's fee provided for in section 10136, C. O. S. 1921, is in the nature of an occupation tax, with privilege of the use of the public highways in the conduct of his business of a dealer in automobiles, and that the payment thereof does not exempt the dealer from payment of an ad valorem or property tax on his automobiles, owned by him as his stock of merchandise, for the year in which the fee was paid.
Defendants in error at page 1 of their brief state:
"There is only one question presented to this court, and that is: 'Was the new automobile, owned by the dealer, J.C. Taylor, taxable on an ad valorem basis for the year 1924?' "
The Legislature in 1915 provided for the registration and taxing of automobiles. Session Laws 1915, chapter 173. This law was construed by this court in Ex parte Shaw, 53 Okla. 654,157 P. 900. At page 664, in referring to this act, this court said: *Page 21
"* * * The act must stand unless unconstitutional. * * * Counsel contends that it is, because, they say, that part of article 4, section 3, of the act which reads: 'The registration fees imposed by this article upon motor vehicles, other than those of manufacturers and dealers, shall be in lieu of all taxes, general and local, to which motor vehicles may be subject as personal property under the laws of this state,' and section 12, which reads: '* * * After July 1, 19.15, no motor vehicle, as defined herein, shall be taxed on an ad valorem basis and the county assessor shall not make return of any such motor vehicle in any assessment sheet after said date,' constitute an attempt on the part of the Legislature to exempt from taxation motor vehicles which were not so exempt before, contrary to the Constitution, article 5, section 50, which reads: 'The Legislature shall pass no law exempting any property in this state from taxaction except as otherwise provided in this Constitution.' But this was not an exemption of property, but a substitution of one form of taxation for another, as held In re Gross, Production Tax of the Wolverine Oil Co., 53 Okla. 24, 154 P. 362."
The taxing authorities of this state have not attempted to tax automobiles on an ad valorem basis.
Section 10131, C. O. S. 1921, provides the license fee that should be paid by automobile owners other than manufacturers or dealers. It further provides that:
"The registration fee imposed by this article, upon motor vehicles other than those of manufacturers and dealers, shall be in lieu of all taxes, general or local, to which motor vehicles may be subject as personal property under the laws of this state."
Section 10136, as amended by Session Laws 1925, page 62, provides in part as follows:
"Every person, firm, association, or corporation manufacturing or dealing in new motor vehicles may, instead of registering each motor vehicle so manufactured or dealt in, make a verified application upon a blank to be furnished by the Department of Highways, for a general distinctive number for all motor vehicles owned or controlled by such manufacturer or dealer * * * on payment of a registration fee of $25."
This article permits a dealer in motor vehicles, instead of registering each motor vehicle, to take out a dealer's license in lieu thereof. The agreed statement of facts in the case at bar discloses that the plaintiff owned one car. He was not required under this law to take out a dealer's license, but he could have registered this car under section 10131, supra, and, as stated in the brief of plaintiff in error, this registration fee would have cost $17. The dealer has a choice of taking out the dealer's license or the license provided for in section 10131, supra. Had the owner of this car taken out a license under section 10131, the statute specifically providing that this shall be in lieu of all other taxes, and the owner having a choice to register his car under 10131 or 10136, it necessarily follows that the license fee paid under 10136 is in lieu of all other taxes.
The effect of the majority opinion would be to require all automobile dealers to list their automobiles for ad valorem taxes. The tax provided for in section 10136 is not an occupation tax, for the reason that all dealers are not required to take out dealer's license but have the privilege of registering their cars under section 10131. The law further provides that when an automobile is sold it cannot be delivered until section 10131 has been complied with by the purchaser.
The opinion, at page 19, states that the specified dealer's fee is in the nature of an occupation tax, which would give the dealer the privilege of the use of the public highways in the conduct of his business for the purpose of demonstration of such property in the sale thereof.
Section 10129, C. O. S. 1921, provides:
"Every owner or custodian of a vehicle with motor attachment having value, whether in operation on the public highways of this state or in storage, shall, except as herein otherwise expressly provided, cause to be tiled by mail or otherwise in the office of the Department of Highways, or with its agent, a verified application for registration."
This act, in effect, requires all motor vehicles to be registered with the Dapartment of Highways, and further provides the license fee to be paid, which has been construed by this court to be substituting one form of taxation for another.
The automobile in the case at bar was not subject to ad valorem taxes under any statute in Oklahoma. The county assessor was prohibited from putting it on the tax roll for ad valorem taxes, and the only tax the owner was liable for was the registration fee provided in section 10131, supra, or if lie should so desire, the license or dealer's fee provided for in section 10136, supra.
The effect of the majority opinion in holding the dealer's fee in the nature of an *Page 22 occupation tax which would give the dealer the privilege of the use of the public highways in the conduct of his business, would apply with equal force to every owner of automobiles in Oklahoma. If dealer's fee is not in lieu of ad valorem taxes, then the fee provided for in section 10131 would, of necessity, be an occupation tax and not in lieu of ad valorem taxes.
The question is, Does section 10136 known as the dealer's fee, levy a property tax or a privilege tax? It is contended by plaintiff in error that the payment of the tax therein provided is the payment of a property tax. It is true the statutes use the term "registration fee," but as observed in Re Skelton Lead Zinc Co.'s Gross Production Tax, 81 Okla. 134, 197 P. 495:
"The kind of a tax, or the species to which it belongs is not made by giving it a name, nor its species changed by changing its name, either by legislative enactment or by judicial decree. It is a property tax or an occupation tax, according to the mission given it by the law under which it is levied."
And as stated in State v. Wetz (N.D.) 168 N.W. 835, there is, no particular magic in a name or even a legislative designation of a particular form of taxation. Though the Legislature may call that which is distinctly a tax by some other name, it nevertheless remains a tax.
Section 50, article 5, of the Constitution provides:
"The Legislature shall pass no law exempting any property within this state from taxation except as otherwise provided in this Constitution."
The question then arises, Did the Legislature intend to exempt motor vehicles from taxation, in violation of section 50, article 5, of the Constitution, or did they intend simply to substitute one kind of taxation for another? That the Legislature may substitute one form of taxation for another has many times been held by this court, notably In the following cases: In Re Gross Production Tax of the Wolverine Oil Co., supra, and Ex parte Shaw, supra.
In the Gross Production Tax Case this court said:
"That portion of the act which provides that the tax levied shall be in lieu of all other taxes that might be levied and collected upon an ad valorem basis upon the equipment and machinery in and around tiny well producing natural gas or petroleum or other mineral oil, and used in actual operation of such producing well from which a aross production tax is collected as herein provided,' is not an exemption from taxation as prohibited in sections 46, 46U, 50, of art. 5, of the State Constitution, but a substitution of one form of taxation for another upon the conditions named in the act."
Also in Re Oklahoma Nat. Life Ins. Co., 68 Okla. 219,173 P. 376, it is held that the mortgage tax provided for in section 2, chapter 246, Session Laws of 1913, shall be exempt from ad valorem and other taxes; the act substituting in lieu thereof a mortgage registration tax on the mortgage.
If the automobile tax is one on privilege and not on property, then it cannot but be said that the Constitution has been violated if it provides that the Legislature shall pass no law exempting any property from taxation. If the license fee provided for in section 10136, supra, is one on privilege, then the license fee provided for in 10131 is also one on privilege, so the result would be that all automobiles in Oklahoma, whether operated by dealers, owners, or by citizens for their individual use, would be subject to ad valorem taxes under the reasoning in the majority opinion.
I am of the opinion that the Legislature substituted the dealer's fee for a property tax, and in so doing the automobile is not liable for an ad valorem tax.
Section 5 of article 10 of the Oklahoma Constitution provides:
"The power of taxation shall never be surrendered, suspended, or contracted away. Taxes shall be uniform upon the same class of subjects."
The agreed statement of facts shows that the amount of the tax assessed against this property on an ad valorem basis was the sum of $99.35 for the year 1924. It is stated in the brief, and I assume that it is correct, that the license fee provided for in 10131 on the car in question would be $17. Then, under the majority opinion, the tax on this property in the hands of a dealer would be $99.35 and the tax on the same property in the hands of the Individual owner or user of said car would be $17. So it can be readily seen that an attempt to tax a car in the hands of a dealer at a higher or greater rate of taxation than a car in the hands of an individual citizen, who owns the car for his own private use, would be in violation of section 5 of article 10 of the Constitution, which provides that taxes shall be uniform upon the same class of subjects, and the fact that one man owns property for the purpose of sale and another for his own personal use would not permit a *Page 23 different rate of taxation under this section of the Constitution.
I respectfully insist that the judgment of the trial court should be reversed and judgment rendered granting to plaintiff in error a permanent injunction.
HEFNER and SWINDALL, JJ., concur in this dissent.
Note. — See "Taxation," 37 Cyc. p. 891, n. 34.