‘, ~‘i~&ablr
,,_, Ri t, Oroslor, page 11
,, ‘,
mefini of tax* the wrooiml propeity of ttite
; banking odrporatlono in the hands of the, ehar
holdora. It follows from thlr that suoh car-
poratlona are mt now roquirod~to rendor thelt,
permonal progorty ror taxation;, . . .* ,
,’
Tho &me oozietruotlon of the Toxar rtatuts’r iavb~ved ‘.
vai srrnounood by thp Court of Civil‘ f@.r,petiB Of %‘oxncrin the y ; ;, :
ome 0r First ITatlonnl Bank 0r Impaaos vr: City or.uimpaa~
.78 8, w. 42, writ or erroti dlemiossd by the S&rem Coui+t., ,ih& * “,
.-oouPtrtatod an r0im8t
. “It iti settled by doolrrfonrr of the Sup-
roni, Cow: of the United Statea that it linot
.,, ”uithln the $ovor Of a etate to eubjeat tW pro-
party of natlonal banka to taxation vithout,
”
I.
: the Comont or the federal Con.gwar The only
‘, provlaion or the redoral etatutoe vhioh author-
lcer such taxetion la eeotion 5219 o tho Re-
vlsed Statutec of the United St&tee f U.S. Camp.
St. 1901, p, 3502), and that permitd ruah.tcua-
tion w agalnat buch benka, ‘upon riml eetate
Onlg. It authoyizes atato taxation or the
*~ atoek of suoh banke aa a@net the wnom of
such #took, btit not a$ agalnat the bar&m. In
harmony Vith that rtstuto, the Le&islaturo of
.,’ thi8 state has we full provlrrlon for the aa- ,.
awm?nt and colleotlon of taxea,upon national
. “’ b&k stock from the ovnern of uuah rt.oQk, and
.
has made no attempt to oom901 national banks to
priy taxes on euah 9roportgr ‘~Sayleo* Rev. Cl?.
St. 1897, arts. 5079, 5079a, and 5080, Henoe
ne’ are of opinion that the bank vae under no I,
,;:~ legal obligation to render’and 9&y taxer on the
proporty’ln question. Thoee visve are rrupport-
cd by ntithmity. * Miller V. First Ration81
.Bmk, 46,0hio St. 424, 21’R.E. 8601 Blrat lot;
Bank Y, Ffshor, 45 fan. 726, ,26 Pao. 482.’
It la our opinionthat under th6 lava of this State
to a matlonal bank:,ir texablo cq&nat ,.
raonal ,prapertg bslonging~ to ouch a .Nat- t
loaal bank mcy not ‘taxed by the Stats, %rther, &aver of
. .I’. a’.
b .~.
.
.‘,
i&k in ‘a dat$onal bank may be taxed in the hand8 of the ’
rharoholder 8. This ha8 been the lav or thir .Stato rinoo the
ourly Texae Suprome Court oat30 0r Uarrlsoa Y+’Yinor, 46 Vex,
15,~mhs aowt rtatod au 3ollovar
“It fr a& well nettled by the Supreme
‘, court or the United Stattoe, by whose constru0~ ,,
,~’‘. tloa an aot of Congree8 thie oourt Is uri@aor- “,
tionably bound,. that the rrhaiw of bankin5 a81
roolatlons authorized by the abt of June 3,
‘Y’,1864,‘To provide a “national ourronc ” &or
; ” In the hand8 of the ahareholdorr are I’iable $6
ta?ustIon by, tho Statoa with the lltitatlon8
; c and on the oondltlono sot forth in tho forty-.‘,
.’ ‘first soctloa of said sot, although the entlr@
a&pital of euah bank I8 Invested in national 1
roourltloo, whloh are dealwed by theetatuto
.. (authoriaing thorn to be %xcmg
* by ‘or ‘under 5tatoWg;horlty.
The Ae8088or8, ., 5
Comafo8loaor8, t Wall.., 2 1;: Natloaal Bmk v.,
Uoxmtoavoalth, O~Wall., 353.j , . .,.I -
The next question that arl~sa fa whether 02 not tho
mh&rer of- rtook ,la a National bank vhIah are taxed In the name8
of the rhareholdore should bo aeaevsed at a valuetioh iu me-
duoodb+aueo or tho ,faot that. the NationalBank own8 Federal
, Rerervo rtook. Tho rule or lav In euoh a 0088 88 to United
Water bonde owned by a Natloncrl bank vaa stated by ,th8 C,owt . .’:
or oltii A9 oala 0r TQXW in the dam 0r Adair V* Robinson, .1
25 ‘8.:
If..734. The question before the oourtla thatQM@ YOI ,./
rt@tad therola 80 rollowe:
The ‘faoto are sot oontrovertod
“and li &iy quo&ion presented for ow de& de&
#ion 18 the right of the ovnara of the rtock
or the. bank to ronder the. awio for taxation at
: ‘.‘ftr aotual Y~~UO, lone the amount of the United
&ate8 bond8 Andythe legal tender not08 owned,
.’ b thr ba@c oa the I8t day ?r.+naary~Aa ‘De ._
.1591:. ...*y .
. I ," :
<, '. .*
*.
',
,,~ .
5
.~‘.,., .,. “” -“~. ‘*‘~:j’f’.
I
‘,
. ’
‘.
( ..
’
' The oourt'hald OII follwel
I.4 . !l%crcs is ho decision of that oourt
known to u; whloh tenda to sustain the content&on
of eefondcnt II ln ,errorj but, on the contrary, la.
filie oaffo of Vm Nlon v.~Aoa~~~~r, 3 lidll. 573;. ,
:’,it~,ia eqmmily dooided by a majority of the
.. supreme cowt of. the, United Etatou, after thor- ‘, ii.
‘ough tuul e~hauotive ~dleouoeion of the question; :.
,,,
that it was not tho r&at of the ehareholdare .~. ’
‘.of .a national bank to hem deducted from the ~’
“‘-value of their sham@ of atook, when rendered
to the state offioor for taxation, the drumof
tione;r invested by the bank in United Etatgs ‘.
: bonda. Nor 18 there anything in the deoieionr.
of. the tu~rome, court of thla state, that Yo
hare discovered, which coL-stonauoee tho rule
,.’ for easeermont of chaws cf bauk stook vhlch
,~’ ,,the defendants in error contend for, . .~ ,”
In the case of Fimt E!%sional Zank of'C5.m.ioinui~t1, :
Chio, 0. Qutir, 246 FM. 163, the shareholders in a Rational
bank’oontendsd that the value of the sharer of stock in said
: bank must be reduced for etate ad valorem tax purpoaor beoawe’
the bank'r ovqorohip of lahtcrcs of rtock 4~ a Fedorsl Remrvo
b&k. The oontontlon of the bank’s Wwoholderr’in that 08SO
~wu”88 t0110vr 8
*The plal&iff oltiims that the provision8 ‘:
. .of’riotion 5219, R.8,U.S. (Aot June 3, 1864, #
d. 106 ( 41, 13 Stat, 111, aa amended Febrmarg .: ,
,.lO, 1868 (15 Stat. 34, c. 7)), are so far ro- .’
ealed by oectlon 26 of the Federal Resorve AoC : : i,
‘~ PAct, Dee. 23 15113, 0. ..6, 30 Stat. 25 (Omp. St.
1916,’ 1 gSo3j~), that the sharoholdora in the
plaintiff be& aro oxenpt fron taxation by via’-
tuo of rootion 7 of the last-nmod eat (Corsp,
,, St i 1916 ! 979%) on ao much of ito capital : ,.
8na‘rurpiur a8 ia, invoated ir, rtook of the
peder0.l ReseHs Bank. '4 telqlorary ul$lnotion~,
: irruod tmeA'the bill Vai filed. "
II..**, ,. w
:.
, , .'
:~
Honorabl* i. L. Croaler, page.14
;:
,’
‘1. . i P6r the subscription. thus made.”
thd national bank booomor a 8-c fholderoc rtook-
holder In the Fedomil Reserve Dw, but may not.
, +nsfer OP hypotheoato lte ahWeaj each of tiLti
$a.of’the face value of $100. SubaeOtion 3 of .
,‘,‘, ~ ,@Otion’7 prorldeothatJ
. wVcdoral Roa’erve D&&a, inolud% the
: capital atook and atipluo therein, and the in-
o&a dwivcd thorofrom, ah&l1 bo exmpt from
~eeberal, state, end looal taxation, oxoopt tex-
/ es ,upon red estate, 1”
’ Ia tho above quoted portions of the First liatlonal :,
Dank Y, Sh.wr oaao it may be soon. that Thor ehmeboldora in the
Rational Dwk.vere oonteridlng that the provlnlon.ln the Fed-
eral Resews Act, vhioh providoa that tho Fodoml ReaOrvo;
: .banklaoludhg tho oAplt+l stock and tho aurplw thereinand
,lncome dorived tharof’rom voro exempt from Stat0 taxation rO-
qkihwd tho State tw&q authorities to rcduoe t&o value of thr
.aIqarea of atock.in the plalntlff~a National Bank boo&use ,aa%d
~benk’ovncd eharoa of etook in a Federal Reserve Dank. l’he
oourt @nevered the aontention and stated ae follova~ .
,. ’
.“The CJX~llQtfOAppoildod in .?ootiOa 7 dOOS
‘not extend to national banks orgnnieed undo?
the,lVational DanUng’Lan,’ I&ad Coagmsa Ant&d- ‘.
od that their capital otoolr..ehould be relieved
from taxation, it would have oaid 80~
,. *T& stock pkohaeed by the plaintiff ia. .
‘the ‘Pedoral Roaervi3 Da& irr but & nontaxable
inveatmont of a psrt of its oapltal and aur-
plus. As acrid’5n Firlit Hat. Bank vw &bright,
208 u. 8. 48, 553, 20 5up. Qt. 349, 350 (52 ’
,,‘L. zd. 614 J ..
.I ,. n~The’lav does not oonaidez. the xkatuw Of
,a b&k18 investment not texed in f$xing tho
~~
ooluo of ts atook. Palnor V. Mal&ho~, 1%
u.S; 669, t lo sug. Ct. 324, 33 Ii. Ed. 772). ’ ,..
::
‘%hatever value the ohares lsaucd by the
:., ,’ppbfatlff .natiorml benk po~oem, they are :to
., that extont tax&bU in the hand8 of their own-
,.. em .a.nd holdera. Rosonblatt v. Johnrton, 104 Ur.
I’ 8. 462, 26 L. Ed. 832~ my, oto., of San Fran-
oirob, Y. Croaker-Xoolworth Nnt. Bank (0.0,)
.*92 Fed, 273. The oourte have repeatedly ruled’
” ‘, .that., IA Sixbig. ‘the value of the shnros OS
stock of natlonal bank8 for .tfWng purpof~o8, ”
;,
the value due ,t3 the bank’s olmershlp or non-‘,
taxable United Btates~bonda as a part of ltr
..“‘. aaaets must be lnoludod. se, for inntanoe,
Cleveland Trurt Co. v. L!indcr, 184 0.9.. 111,
' ‘22 8up. Ct. 394 46 L. Ed, 4%~ Xa or o.~Anwi~' ~"?:
oan Nat. Bank, i5g Pod. 396,401,86 C.C.A.3?b;c ;,,,:: _
(C.0.A. 6)~ Van Allen,v. Aeaeseorr, 3 Well. e”
73, 18 L. Ed, 229 Peoplo ve Comlsrionera, ~..’ ” *.
2 Well. at pago 25 6, 18 Lt. Ed. 3441Nat,Bank
Y. Comonvealth, g Wall* at p&8&e359, 19 II.Et&
.,7Olj Born0 Cavings Bank Ye De* Moines, 205 lJ.8,
’ .at pwoe 528, 513, 27 Bupr. Otr 571, 51 Lr Ed..
.,’ ,901. .Tho ~amo rulo~ appllea to nontaxable stook
e ;y tho plaintiff in tho Fsafwai Roaorvo
.
The cotit denled the oodtentioa of tho ~rhareholdorr
ls tWXiation&l bon4 and held that the mm rulip applied aa $0
.rtook ovned bu the,Natlonal bank in a Federal Roeerve bank
‘&a har beon p:oviouely announoed CtQpma vhere the NatlOn8l
bank ouaed United .Stator bond8 ~8 p8rt pi it8 &88et8r
ihe Ceoult Court or Appeale’ affirmed the de0bi081:
of the ‘Matriot Court aud utsted ~a Sollow;
“Ne are aatiafled, not only with tho oor- 1~
reotners OS this oonoluaion; but with the peak ,,’
aonlng of the opinion on vhloh the conoluaio~
18 baaed, and 8ro oontont to affirm the juds- .~‘, .,
ment upon that opinion; Uo think its oloar that ..
Oongreso ihtendcd to place a r.mtlonal bank@8
holdingr OS Federal Reeerve Bank rtock ugoa pl+ ‘.
oieel the, uame beair ar its’holdingr OS govern-
meat. Iionde, eo r8p ae exemption *iron taxation
. :
44
~o&rabloit:L. Cro&r, pwe 16 ._
*
,."
of iharesof natlonel bank #took heldby
“‘,atookholdera therein*”
You are therefore’ advised that in the opinion of
thla deiartment, the valueof ahyea OS atookownedby atook-
holdera in a National bank may not be reduood beoauao of the
I fiwt~thot the Nationd bank own8 aha??oa of atook in a Pxloral
Reaewo bank.
We trust that the f6regoing fulli tfnayerr youc la-
‘q&y O?I$hla ptter, .
Your8verytruly