I dissent. With respect to the commerce clause of the Federal constitution, I understand the doctrine of the cases sustaining the legality of taxes on property that has come to a state of rest, purchased in another state, is that the situs of the property becomes fixed for the purpose of taxation, and that the tax is imposed alike upon property purchased in any and all states. This is made clear in Sonneborn Bros. v. Cureton,262 U.S. 506, 43 S. Ct. 643, cited in the majority opinion. In that case, the tax was upon oil, purchased in another state, that had come to a state of rest in the warehouse of the owner who proposed to handle it in his business as a wholesale dealer. In deciding whether or not the tax was a regulation or burden on interstate commerce, it was said:
"The interstate transportation was at an end, and whether in the original packages or not, a state tax upon the oil as property or upon its sale in the State, if the state law levied the same tax on all oil or all sales of it, without regard to origin, would be neither a regulation nor a burden of the interstate commerce of which this oil had been the subject."
Or, as later stated in Baldwin v. Seelig, 294 U.S. 511,55 S. Ct. 497, 79 Law Ed. 1032:
"A state tax upon merchandise brought in from another state, or upon its sales, whether in original packages or not, after it has reached its destination and is in a state of rest, is lawful only when the tax is not discriminating in its incidence against the merchandise because of its origin in another State." (Citing cases.)
The present case, however, is not that kind — the law here involved is plainly at variance with the universality of origin required. Title IV of the act provides generally for "a tax or excise" for the privilege *Page 325 of using within this state any article of tangible personal property purchased after April 30, 1935.
Section 32 says that the provisions of Title IV shall not apply
". . . (c) In respect to the use of any article of tangible personal property the sale or use of which has already been subjected to a tax equal to or in excess of that imposed by this title [2%] whether under the laws of this state or of some other state of the United States."
Further, to make the legislative intention plain from another angle, the next section says:
"Sec. 33. If any article of tangible personal property has already been subjected to a tax by this or any other state in respect to its sale or use in an amount less than the tax imposed by this title, the provisions of this title shall apply, but at a rate measured by the difference only between the rate herein fixed [2%] and the rate by which the previous tax upon the sale or use was computed."
Therefore, if a resident of this state buys a trailer in this state and pays the required retail sales tax of 2% and buys one in Idaho and pays a sales tax, we assume, of 2%, and buys one in Illinois and pays a sales tax, we assume, of 3%, then the owner can use all of such property in this state free from this tax. On the contrary, if he buys a trailer in Oregon, which, we assume, has no sales tax law, then he must pay a tax of 2% to use it in this state; or if he buys one in Missouri, which, we assume, has a sales tax of 1%, then he must pay a tax of 1% to use it in this state. Such a law stifles competition and sets up an economic barrier against the commerce of other states.
The controlling question here is not the power of the state to tax or to levy an excise, but whether the legislature in the exercise of that power has enacted a law repugnant to the limitations imposed by the *Page 326 constitution of the United States. United States Constitution, Article I, § 8, clause 3; 14th Amendment, § 1.
The case of Baldwin v. Seelig, supra, involved two appeals, one concerning an importer's sale of milk and cream to the importer's customers in original cans, the other involving sales after the articles were bottled by the importer in New York. An act of that state was considered under the commerce clauses of the United States constitution, and the principles announced in that portion of the opinion discussing the importer's sale in original packages is pertinent and should be applied in the present case as decisive of the question involved. The act was not directed to the importation of milk from any particular state; the milk involved was imported from Vermont. In that case, it was held that (Syllabus, 79 Law Ed. 1032):
"1. A New York Milk Control Act fixing minimum prices to be paid by dealers to producers for milk, and prohibiting the sale within the state of milk brought from outside the state unless the price paid to the producers would be lawful upon a like transaction within the state, is violative of the commerce clause of the Federal Constitution, and its enforcement will be restrained by injunction as applied to sales by a New York dealer in the original packages of milk imported from another state."
In the course of the opinion, upon speaking of the lack of power in a state to enact such a law, the court said:
"Such a power, if exerted, will set a barrier to traffic between one state and another as effective as if customs duties, equal to the price differential, had been laid upon the thing transported. Imposts or duties upon commerce with othercountries are placed, by an express prohibition of the Constitution, beyond the power of a state, `except what may be absolutely necessary for executing its inspection laws.' Constitution, Art. I, § 10, cl. 2; Woodruff v. Parham, 8 Wall. *Page 327 123, 19 L.ed. 382. Imposts and duties upon interstate commerceare placed beyond the power of a state, without the mention of anexception, by the provision committing commerce of that order tothe power of the Congress. Constitution, Art. I, § 8, cl. 3.`It is the established doctrine of this court that a state maynot, in any form or under any guise directly burden theprosecution of interstate business.' International Textbook Co.v. Pigg, 217 U.S. 91, 112, 30 S. Ct. 481, 487, 54 L. Ed. 678, 27 L.R.A. (N.S.) 493, 18 Ann. Cas. 1103, and see Brennan v.Titusville, 153 U.S. 289, 14 S. Ct. 829, 38 L. Ed. 719; Brown v.Houston, 114 U.S. 622, 5 S. Ct. 1091, 29 L. Ed. 257; Webber v.Virginia, 103 U.S. 344, 351, 26 L. Ed. 565; Kansas City SouthernR. Co. v. Kaw Valley Drainage District, 233 U.S. 75, 79,34 S. Ct. 564, 58 L. Ed. 857. Nice distinctions have been made attimes between direct and indirect burdens. They are irrelevantwhen the avowed purpose of the obstruction, as well as itsnecessary tendency, is to suppress or mitigate the consequencesof competition between the states. Such an obstruction is directby the very terms of the hypothesis. We are reminded in the opinion below that a chief occasion of the commerce clauses was `the mutual jealousies and aggressions of the States, taking form in customs barriers and other economic retaliation.' Farrand, Records of the Federal Convention, vol. II, p. 308; vol. III, pp. 478, 547, 548; the Federalist, No. XLII; Curtis, History of the Constitution, vol. 1, p. 502; Story on the Constitution, § 259. If New York in order to promote the economic welfare of her farmers, may guard them against competition with the cheaper prices of Vermont, the door has been opened to rivalries and reprisals that were meant to be averted by subjecting commerce between the states to the power of the nation." (Italics mine.)
If a resident of this state desires to purchase a trailer, it would be well for him to buy it in this state. The rule of keepyour money at home, viewed apart from all considerations save only its apparent economic virtue, is highly commendatory, but it should *Page 328 neither be compelled nor attempted at the expense of violating the limitations fixed by the constitution of the United States.
Nor can it make any difference whether this charge be called a tax upon imports from another state or simply a tax or excise. Section 31 of the act speaks of it as "a tax or excise." "The name by which the tax is described in the statute is, of course, immaterial. Its character must be determined by its incidents."Dawson v. Kentucky Distilleries, 255 U.S. 288, 41 S. Ct. 272;Flint v. Stone Tracy Co., 220 U.S. 107, 31 S. Ct. 342, Ann. Cas. 1912B, 1312; Aberdeen Savings Loan Ass'n v. Chase, 157 Wash. 351,289 P. 536, 290 P. 697, 71 A.L.R. 232.
In my opinion, § 31 of the act providing for the levy and collection of a tax or excise for the privilege of using within this state any article of tangible personal property purchased in another state subsequent to April 30, 1935, is invalid.
HOLCOMB, J., concurs with MITCHELL, J.