1. In imposing license taxes upon the manufacture of oil and
fertilizer from fish, the legislature of Alaska, having in view the
value of herring as a food supply for men and for salmon,
constitutionally may discriminate against those persons who consume
herring in the manufacture, as compared with those who use other
fish or salmon offal. P.
255 U. S.
48.
2. A license tax, otherwise valid, is not unconstitutional
because it destroys a business without compensation.
Id.
3.
Held that the purpose of the legislature in enacting
the tax laws involved in this case must be gathered from the
statutes, and not from the allegation in the bill attacking them,
admitted by demurrer. P.
255 U. S.
49.
4. The Act of August 24, 1912, c. 387, 3, 37 Stat. 512, creating
the Alaskan Legislative Assembly and granting it power to alter,
amend, modify and repeal laws in force in Alaska, declared that
such power should not extend to the "fish laws" of the United
States there applicable, or to laws of the United States providing
for taxes on business or trade, and further declared that "this
provision shall not operate to prevent the legislature from
imposing other and additional taxes or licenses."
Held:
(a) That certain acts of Congress imposing taxes on fish oil and
fertilizer works based on output (Alaska Comp.Laws, §§
2569, 259) are not "fish laws" within the meaning of this
limitation. P.
255 U. S.
49.
(b) That subjection of a particular industry to this
congressional tax does not imply a license to continue in business,
and thus prevent additional, even prohibitory, taxation by Alaska
under the broad power granted.
Id.
(c) That an additional tax by Alaska, being thus authorized, is
not objectionable as double taxation. P.
255 U. S. 50.
5. A discriminatory license tax,
ut sup. par. 1,
held consistent with the command of § 9 of the said
Act of August 24, 1912, that all taxes shall be uniform on the same
class of subjects. P.
255 U. S.
49.
6. The provision of the same act, § 9, that no tax shall be
levied for
Page 255 U. S. 45
territorial purpose in excess of one percent of the assessed
valuation of property, does not apply to license taxes. P.
255 U. S. 50.
Affirmed.
The case is stated in the opinion.
Page 255 U. S. 47
MR. JUSTICE HOLMES delivered the opinion of the Court.
This is an action to recover the amount of taxes levied under
statutes of Alaska which the plaintiff alleges to be contrary to
the Act of Congress of August 24, 1912, c. 387, § 3, 37 Stat.
512, creating a legislative assembly in the Territory of Alaska,
and to the Constitution of the United States. Judgment was given
for the defendant upon demurrer to the complaint, the parties
agreeing that the foregoing grounds of recovery were the only
matters in dispute. The statutes attacked,
viz., May 1,
1913 (Laws 1913, c. 52), April 29, 1915 (Laws 1915, c. 76), and May
3, 1917 (Laws 1917, c. 74), levy license taxes of two dollars a
barrel and two dollars a ton respectively, upon persons
manufacturing fish oil, fertilizer and fish meal in whole or in
part from herring. The Act of Congress, after giving effect to the
Constitution and laws of the United States in the Territory,
provides that the authority therein granted to the legislature
"to alter, amend, modify, and repeal laws in force in Alaska
shall not extend to the . . . fish . . . laws . . . of the United
States applicable to Alaska, or to the laws of the United States
providing for taxes on business and trade, . . .
Provided,
further, that this provision shall not operate to prevent the
legislature from imposing other and additional taxes or
licenses."
Some reliance is placed also upon § 9 that all taxes shall
be uniform upon the same class of subjects, &c., and that no
tax shall be levied for territorial
Page 255 U. S. 48
purposes in excess of one percentum upon the assessed valuation
of property therein in any one year.
The complaint alleges that the tax will prohibit and confiscate
the plaintiff's business, which is that of manufacturing fish oil,
fertilizer, fish meal, and byproducts from herring, either in whole
or in part; that the tax unreasonably discriminates against the
plaintiff, as it levies no tax upon the producers of fish oil,
&c., from other fish, and is otherwise extortionate, and that
it contravenes the Act of Congress in lack of uniformity and in
exceeding one percentum of the actual value of the plaintiff's
property. The prophecies of destruction and the allegations of
discrimination as compared with similar manufactures from salmon
are denied by the Attorney General for Alaska, the latter denial
being based upon a comparison of the statutes, which, of course, is
open. We are content, however, to assume for the purposes of
decision that, not to speak of other licenses, the questioned acts
do bear more heavily upon the use of herring for oil and fertilizer
than they do upon the use of other fish. But there is nothing in
the Constitution to hinder that. If Alaska deems it for its welfare
to discourage the destruction of herring for manure and to preserve
them for food for man or for salmon, and to that end imposes a
greater tax upon that part of the plaintiff's industry than upon
similar use of other fish or of the offal of salmon, it hardly can
be said to be contravening a Constitution that has known protective
tariffs for a hundred years.
Rast v. Van Deman & Lewis
Co., 240 U. S. 342,
240 U. S. 357.
Even if the tax should destroy a business, it would not be made
invalid or require compensation upon that ground alone. Those who
enter upon a business take that risk.
McCray v. United
States, 195 U. S. 27.
See Quong Wing v. Kirkendall, 223 U. S.
59;
Mugler v. Kansas, 123 U.
S. 623;
Louisville & Nashville R. Co. v.
Mottley, 219 U. S. 467,
219 U. S. 482.
We need not consider whether abuses of the power might go to
Page 255 U. S. 49
such a point as to transcend it, for we have not such a case
before us. The acts must be judged by their contents, not by the
allegations as to their purpose in the complaint. We know of no
objection to exacting a discouraging rate as the alternative to
giving up a business when the legislature has the full power of
taxation. The case is different from those where the power to tax
is limited to inspection fees and the like, as in
Postal
Telegraph & Cable Co. v. Taylor, 192 U. S.
64,
192 U. S.
72.
But it is said that, however it may be with regard to the
Constitution taken by itself, the statutes brought into question
are contrary to the act of Congress from which the local
legislature derives its power. In the first place, they are said to
be an attempt to modify or repeal the fish laws of the United
States. The Act of Congress of June 6, 1900, c. 786, § 29, 31
Stat. 321, 331, Alaska Compiled Laws, § 2569, imposes a tax on
fish oil works of ten cents per barrel and on fertilizer works of
twenty cents per ton, repeated in slightly different words by the
Act of June 26, 1906, c. 3547, 34 Stat. 478, Alaska Compiled Laws,
§ 259. But these are not fish laws as we understand the
phrase. It is argued, however, that at least they import a license,
License Tax
Cases, 5 Wall. 462,
72 U. S. 470,
and that a tax alleged to be prohibitory flies in their teeth. It
would be going far to say that a tax on fish oil works in general
terms imported a license to a specific kind of works deemed
undesirable by the local powers, and, when we take into account the
express and unlimited authority to impose additional taxes and
licenses, we are satisfied that the objection should not prevail.
We confine our decision to the statutes before us, repeating in
this connection that they must be judged by their contents, not by
the characterization of them in the complaint.
The requirement of uniformity in § 9 is disposed of by what
we have said of the classification when considered with reference
to the Constitution. The legislature was
Page 255 U. S. 50
warranted in treating the making of oil and fertilizer from
herring as a different class of subjects from the making of the
same from salmon offal. The provisions against taxing in excess of
one percentum of the assessed valuation of property does not apply
to a license tax like this. This is not a property tax.
Alaska
Pacific Fisheries v. Alaska, 236 F. 52, 61. The objection that
the plaintiff in error is doubly taxed, first by the United States
and then by the Territory, is answered by the express authority to
levy additional taxes to which we have referred heretofore. Without
going into more detail, we are of opinion that the tax must be
sustained.
Judgment affirmed.
