Johnston v. Mayor of Macon

Jackson, Justice.

1. The main question in this case is whether the city of Macon, having already taxed the property of people doing business, within its limits, can also under the charter tax the business of those people ? The limitation in the charter is that no tax shall be levied on real and personal property over one per .cent, on its value ; does that limitation apply to business and the capital therein employed? We are of the opinion that it does not. There is more or less of capital in every sort of business. Professional men have books, furniture, instruments, etc., etc., employed about their business, yet nobody contends that because a tax is paid on this property their business also cannot be taxed. A tax on property is one thing; a tax on business is a different thing. This distinction is clearly drawn in the books, and by our court. Indeed the question is not an open one with ns. It was settled in the case of The City of Macon vs. The First National Bank of Macon, 59 Ga., 648. There we held against the city, that it could not tax the business of that bank because it was or might be a fiscal agent of the federal government, though it might tax its property, and the shares of its stockholders.

So in another case of this same city vs. The Macon Savings Bank, 60 Ga., 133, we held that the city might tax the business of that bank, though it had already taxed its capital as property, which is precisely the point here.

In the first case it could not tax the business of the National Bank because it was chartered by Congress, and the government of the United States used its business for their fiscal operations or could use it, and any interference by state taxation might, if allowed at all, amount to prohibition — by making the tax so high as to be prohibitory. In the last case, the bank was a state institution, the creature of its will, and its business could be taxed unless there was some provisions in its charter which prohibited the tax; and citing the charter, or grant of power to tax in the city, from acts of 1871-2, par. 14, we held that it covered “ any profession, trade or calling, or business of any nature whatever.” Indeed, such is the language of the grant itself. The limitation of one per cent, on property taxation was then considered in that case, and then determined. See, also, cited by plaintiff in error, 42 Ga., 596; 49 Ga., 135; 50 Ga., 530; 52 Ga., 251; 53 Ga., 410, 616; 54 Ga., 645; 55 Ga., 678. Cooly on Tax., 384, 389. Burroughs on Tax., 146, 147, 152, 154, 390.

Nor do we think that the subsequent acts amendatory of this power to tax, granted by the act of 1871 before cited, affect the question. Those provisions are found in the acts of 1874, pp. 110 and 196. They make still a limitation on the power to tax froperty, not business; and the distinction is a clear and settled one.

2. Whilst, therefore, we think the city may tax the business of the merchant, just as the business of the carpenter or blacksmith, or drayman or druggist, or doctor or lawyer, all of whom employ more -or less of capital, we are of opinion that/the merchants should either be classified by some clear distinction in business other than the amount or value of the business, such as wholesale or retail, dry goods or groceries, or if the tax be scaled according to the amount of business or value of sales, then such tax should be ad valorem. Such is the scheme and spirit of the constitution of 1877, and wherever any taxing power acting under that instrument essays to levy a tax in- reference to values, it should levy ad valorem. The truth is, this is the only just mode. Otherwise, as indicated in the second head-note to this opinion, a dealer in general merchandise might pay under the tax levied, $100.00 on $1,000.00 of goods sold, whilst others paid but $10.00 on the same sum. We think, therefore, that the clause which levies a tax of $300.00 on dealers who sell over $200,000.00, and $200.00 on dealers between $100,000.00 and $200,000.00, etc., etc., etc., is against the spirit of the constitution of 1877, and might result in great inequality and injustice. See constitution of 1877, article YII, section II.

It is true that the clause cited in words applies to property, but in sense and spirit we think it covers a business-tax scaled by the amount or value of the business transacted.

3. The tax on drays proportioned or scaled by the number of horses — as one horse or two horse drays — we sustain as legal. The business is taxable whether the drays merely do the business of certain stores and their customers, or a general business. - The wear and tear upon streets, bridges, etc., is as great in the one as in the other case.

4. But a tax on a private wagon for private use, not employed in any business of the owner, is not a tax on business but on property, and cannot be more than one per cent,, and if taxed that much as property, it cannot be taxed again.

5. The mayor and council cannot delegate to the mayor the power to tax — “ delegatus non potest delega/reP

6. Of course the state cannot grant power to another which itself does not possess; therefore, it cannot confer on a municipal corporation the right to tax anything which it may not have the power to tax itself. Still the corporation may tax and the state not tax; because the legislature does not see fit to tax certain subjects of taxation, which it has the right to tax, it does not follow that a city, on which it has the conferred, the power to tax those same subjects, is barred from exercising the power, because the state did not exercise it. Burroughs on Tax, 385, 381.

7. There is nothing in the objection to the commutation street tax of three dollars in lieu of working the streets. It is not a poll tax and therefore not obnoxious to the constitution. Cooley on Tax., p. 12.

8. On the whole, we consider the judgment of the chancellor in the main correct; but so far as it upholds the ordinances taxing dealers in merchandise as they now stand, and the power of the mayor to tax under his delegated authority from council, and the specific tax on private wagons, we must reverse it.

It is a very delicate and dangerous thing to stop the wheels of government, either state or municipal; it tends to throw things into confusion and anarchy; and courts are slow to interfere. But the taxing power is a great power, and shoiüd be as sparingly exercised as possible. Much must be left to the discretion of those elected by the people to levy taxes. The ballot-box will ordinarily furnish a remedy before great harm is done in cases of abuse. From the record in this case it does not seem that more tax is imposed than is necessary to pay the debts falling due and to cany on the city governmerff during the present year; and after as careful a consideration as it was in our power to give the case, we arrive at the conclusions above indicated, and leave it to the chancellor to enfore them by such orders and directions as may be necessary to carry them into effect.

Judgment reversed with instructions.