Holzwasser v. Brady

Brailsford, Justice

(dissenting) :

Being convinced that the disparate assessment of plaintiff’s property offends the requirements of uniformity and equality in this field, written four tmies into the Constitution of 1895, I respectfully dissent. I am unable to better expound this view than by the following quotations from the able decree of the circuit court.

“That the Plaintiff is paying more than twice as much tax on a dollar’s worth of her property as her neighbors are paying on a dollar’s worth of theirs is quite obvious. The question is whether this disparity in the taxation of real property in the same taxing district meets the ‘uniformity’ test of the State Constitution.

“There are four uniformity clauses in the State Constitution.

“Article III, Section 29 provides as follows:

‘All taxes upon property, real and personal, shall be laid upon the actual value of the property taxed, as the same shall be ascertained by an assessment made for the purpose of laying such tax.’

“Article X, Section 1, which is more specific, is the Constitutional mandate to the General Assembly to establish by law a system of property taxation in the State. It is the source of the authority of the General Assembly to enact Act No. 1266, which the Defendant’s Demurrer defends as constitutional in this case. It provides, in part:

*490‘The General Assembly shall provide by law for a uniform and equal rate of assessment and taxation, and shall prescribe regulations to secure a just valuation of taxation of all property, real, personal and possessory.’

“This Constitutional mandate to the General Assembly, it will be noted, specifically requires a ‘uniform and equal’ rate of assessment, as well as taxation, of all property.

“Article X, Section 3A, is clear and unambiguous. It provides that—

‘All property subject to taxation shall be taxed in proportion to its value.’

“Spartanburg County derives its Constitutional power to levy taxes from Article X, Section 5(1), which provides in part as follows:

‘The corporate authorities of counties, townships, school districts, cities, towns and villages may be vested with power to assess and collect taxes for corporate purposes; such taxes to be uniform in respect to persons and property within the jurisdiction of the body imposing the same (italics added) . . .’

“Stated another way, Spartanburg County may not be vested by the General Assembly with power to assess and collect taxes which are not uniform with respect to persons, as well as property, within the County.

“We have here a taxpayer who owns real property leased to a manufacturer. The tax on that property is measured by 9.5% of its value. Within a stone’s throw are parcels of real property leased to a commercial printing establishment, an automobile sales and service agency, an automobile service station, retail stores, a bank, a cafeteria, a movie theatre, a bowling parlor and various service establishments and business offices. The tax on those parcels is measured by 4.2% of their value. Not only is there a lack of uniformity here with respect to property; there is also a lack of uniformity with respect to persons. Both types of discrimina*491tion are proscribed by Article X, Section 5(1) of the Constitution.

“It is universally held that, in areas of taxation where any classification is permissible, taxation must be equal and uniform within the class. . . .

“This principle is forthrightly recognized in the Defendant’s Demurrer where the defense to the Plaintiff’s action is based squarely and solely upon the proposition that ‘The Constitution allows the General Assembly to classify property for purposes of taxation.’

“It is clear, then, that the lack of uniformity between Plaintiff’s tax rate of 9.5% and her neighbors’ tax rate of 4.2% can be upheld only if the Plaintiff’s property and her neighbors’ property were properly placed into two separate classifications for tax purposes.

“The impact on this case of Newberry Mills, Inc. v. Dawkins, et al., 259 S. C. 7, 190 S. E. (2d) 503 (1972) should be noted at this point.

“In Newberry Mills, the property, both real and personal, of the Plaintiff, a manufacturer, had been assessed by the State Tax Commission at 10% of its value. For the same year, the County Tax Assessor had assessed all other real property in the County at 5% of its value, and all other personal property at 10% of its value. The Plaintiff appealed its assessment to the Tax Board of Review, which reduced the real property assessment ratio to 5%, in line with locally assessed real property in the County, but left the personal property ratio at 10%. The Plaintiff paid its tax under protest and brought an action under Section 65-2662 to recover. The Supreme Court held that it was constitutionally permissible to tax the Plaintiff’s personal property at 10% of its value, while real property in the same county was taxed at 5 % of its value.

“Newberry Mills did not expressly hold that it is constitutionally impermissible to tax manufacturers’ real prop*492erty at a higher effective rate than the rate applicable to other real property in the same taxing district, for the Tax Board of Review had already decided that issue in the taxpayer’s favor before the case reached court. Newberry Mills, however, did hold, by necessary implication, that all real property had to be taxed alike, and that all personal property had to be taxed alike, in the same taxing district. In that case, the Supreme Court said:

‘The order of the Tax Board of Review requires the Commission to use the same ratios for manufacturers’ realty and personalty as used by the local authorities for realty and personalty of other taxpayers. There is therefore equality and uniformity in the assessment as required by the Constitution and statutes.’

“Webster defines ‘Therefore’ as meaning ‘for that reason.’ What the Court is saying, then, is that manufacturers’ real property was being taxed the same as all other real property, and that manufacturers’ personal property was being taxed the same as all other personal property, and for that reason, there was equality and uniformity, as required by the Constitution. The clear converse of this proposition is that, if the realty of manufacturers had been assessed at a higher ratio than the realty of other taxpayers in the County, or if the personalty of manufacturers had been assessed at a higher ratio than the personalty of other taxpayers in the County, then the constitutional requirements of equality and uniformity would have been lacking.

“The Court said, in effect, that property may be classified for tax purposes into two categories — real and personal— without offending the equality and uniformity provisions of the State Constitution; but that any classification of real property or personal property into sub-categories, resulting in different rates in the sub-categories, would be unconstitutional. Under that ruling, the property of manufacturers, real or personal, cannot, in keeping with the Constitution, be put into a category that carries a higher tax rate than the *493rate applied to like property, real or personal, of other taxpayers.

“If real property could be classified by the General Assembly into two sub-categories, one for manufacturers, and one for non-manufacturers, as the Defendant contends, it could be sub-classified into three, or six, or a dozen, or fifty, or more. So could personal property. The equality provisions of the State Constitution would thus be reduced to a shambles. It was to avoid that very evil, in my judgment, that the framers of the Constitution wrote the uniformity requirement into that instrument, not once, but four times.”

In my view, the Constitutional mandates specially requiring uniformity and equality in the field of assessment and taxation of property are so crystal clear as to make consideration of the due process clauses, also invoked by the demurrer, unnecessary.

I would affirm the decree of the circuit court.

Bussey, J., concurs.