The opinion of the court was delivered by
Brewer, J.:The question involved in this case is simply this: Are private bankers liable to taxation upon the average amount of deposits used by them in their business? The question arises under section 23, chapter 34, laws of 1876, which reads thus:
“Every private bank, banker, broker, building [and] loan and trust association, shall list and return the average amount of capital invested in such business during the year next preceding the first day of March preceding the time required for listing personal property, whether such capital is in the form of a deposit in such bank, or otherwise.”
The question must be answered in the affirmative. The language is not perhaps entirely free from doubt, and yet points strongly in that direction; and such construction harmonizes with the general policy of the tax law. Counsel for plaintiffs lays stress on the phrase “capital invested,” and says that that can only mean the capital put into the concern by the banker himself, and in consequence would limit the last clause to such capital. He would make the clause read, “whether such capital is in the form of a deposit by him in such bank, or otherwise.” We think this distorts and narrows the meaning of the statute. It aims to reach all the moneys used in the banking business, whether moneys owned by the banker before engaging in business, or borrowed by mortgage, loan, or obtained from depositors as deposits. If it aimed to reach only the banker’s original capital, or capi*598tal and profits, the last clause never would have been added. In this respect it harmonizes with the rule respecting taxation of merchants and manufacturers. (See art. 5 of said eh. 34.) They are required to list the average amount of stock on hand during the year, irrespective of the question whether it is all paid for, or all, bought and held on credit. If a merchant is doing business entirely on credit, he is nevertheless taxed on the stock he has thus bought. Suppose he buys and keeps on an average a stock of $10,000: he is required to list that amount, although all the time he may owe the entire sura to the parties from whom he makes his purchases. So, when á banker having no capital of his own, (and when the assessment-roll is examined it is astonishing to see how little capital bankers have!) borrows money in the way of dep'osi'ts, and engages in business on such deposits, he is treated exactly as the merchant, if he is taxed upon the average of such deposits. And such deposits .being money, the average amount is the average value. The fact that he owes the depositors, is no more reason for exemption, than the fact that the merchant owes for his stock. Again, the intention of the legislature is made more clear by sec. 6 of said tax law. That authorizes a deduction of debts from credits, “provided, such debts are not owing to any person, company or corporation as depositors in any bank or banking association, or with any person or firm engaged in the business of banking, in this state or elsewhere.” In other words, the banker may not call his deposits “debts,” and deduct the same from his credits. This shows that the legislature intended to make him pay on his deposits, at least so far under section 23 as he uses them in his business. In this legislation the legislature has but followed the express mandate of the constitution. Section 2, art. 11, of that instrument reads:
“The legislature shall provide for taxing the notes and bills discounted or purchased, moneys loaned, and other property, effects, or dues of every description, (without deduction,) of all banks now existing, or hereafter to be created, and of all bankers; so that all property employed in banking *599shall always bear a burden of taxation equal to that imposed upon the property of individuals.”
The judgment of the district court will be affirmed.
All the Justices concurring.