power of taxation, an inspection fee upon it need bear no relation to the cost of inspection.

6. Taxation Distinguished from other Governmental

Powers

Pecuniary impositions having many of the characteristics of special assessments under the power of taxation are in some instances enforced as an exercise of the police power, and the resemblance between the set-off of benefits in assessing damages for the taking of land under the power of eminent domain and the assessments of betterments under the taxing power for the construction of the improvements for which the land is taken is often close; but these distinctions are discussed at length in later sections of this work.1

In some jurisdictions an attempt has been made to employ the power of taxation to assist in the enforcement of the criminal law, and a heavy "mulct tax" is imposed on the performance of a prohibited act. When the statute provides proceedings appropriate for the collection of a tax rather than for the enforcement of a penalty and does not contemplate a criminal proceeding, it will be treated as imposing a tax rather than a penalty."

The power of a state to require all able-bodied citizens to work upon the public highways a certain number of days each year is so firmly established by custom dating back to the earliest settlement of the colonies that such a requirement does not constitute the taking of property without due process of law and is clearly constitutional. In some states such a requirement is considered an exercise of the power of taxation, but the better view is that it is the enforcement of the duty of every man to serve the state, of which other examples are the obligation of jury service and the conscription of soldiers in time of war, and that consequently statutes enforcing the obligation to labor on the roads are not subject to the constitutional limitations applicable to the power of taxation. In states in which the labor on the roads is performed as a means of "working out" taxes, the statutes which regulate the subject are however enacted under the taxing power.

6 Boston v. Schaffer, 9 Pick. 415 (1830).

1 Infra § § 64, 71.

2 Cook v. Marshall County, 196 U. S. 261 (1905); Hodge v. Muscatine County, 196 U. S. 276 (1905).

Butler v. Perry, 240 U. S. 328. (1916).

7. Whether a Tax is a Debt

A debt is a sum of money due by certain and express agreement and originates in and is founded upon a contract, express or implied. A tax, on the other hand, does not rest upon the contract, express or implied, of the person taxed, but is a forced contribution under an obligation created by statute and founded upon the public necessity. It is therefore generally considered that a tax is not a debt.1 On the other hand it must be remembered that at the common law an information of debt lay to recover any taxes or duties due to the crown, and it is generally considered that, in the absence of any statutory remedy which may well be considered to have been intended to be exclusive, an action at common law may be maintained to recover a tax as for a debt; 2 and a tax will generally be held to constitute a debt when such construction is necessary to enforce the obligation due the public.3

8. The Divisions of the Power of Taxation

The power of taxation, using the word taxation in its generic sense to indicate all pecuniary impositions laid by public authority for the purpose of raising revenue, embraces two divisions, namely taxes, properly so called, and excises.

Taxes, in their specific sense, are burdens laid directly upon persons or property and include (1) general taxes laid on all the persons and property or all the persons and property of a certain class in a particular state, county, city, town or other governmental or territorial division, for the purpose of defraying the public expenses of that governmental or territorial division; and (2) special assessments laid on the property specially benefited by a local improvement in proportion to the benefit, for 1 Lane County v. Oregon, 7 Wall. 71 (1868); Meriwether v. Garrett, 102 U. S. 472 (1880); New Jersey v. Anderson, 203 U. S. 483 (1906); Appleton v. Hopkins, 5 Gray, 530 (1855); Boston v. Turner, 201 Mass. 190, 193 (1909); Attorney General v. East Boston Co., 222 Mass. 450 (1915). See also, Andover etc. Turnpike Corp. v. Gould, 6 Mass. 40 (1809); Crapo v. Stetson, 8 Met. 106 (1841); Richardson v. Boston, 148 Mass. 508 (1889); Old Colony Trust Co. v. Treasurer & Receiver General,

Mass.

(1921).

2 Meredith v. United States, 13 Pet. 486, 260 (1839); Dollar Savings Bank v. United States. 19 Wall. 227 (1873); United States v. Philadelphia etc. R. R. Co., 123 U. S. 113 (1887); United States v. Chamberlin, 219 U. S. 250 (1911).

3 Felker v. Standard Yarn Co., 148 Mass. 226 (1889). See also, Bristol v. Washington County, 177 U. S. 133 (1900).

the purpose of defraying the cost of the improvement. In either case the obligation to pay is absolute and unavoidable and is not based upon any voluntary action of the person assessed.

Excises, in their original sense, were something cut off from the price paid on a sale of goods as a contribution to the support of government. The word has now come to have a broader meaning and to include every pecuniary imposition created under the power of taxation which is not a burden laid directly upon persons or property, or in other words every charge imposed by public authority for the purpose of raising revenue upon the performance of an act, the enjoyment of a privilege or the engaging in an occupation. The obligation to pay an excise is based upon the voluntary action of the person taxed in performing the act, enjoying the privilege or engaging in the occupation which is the subject of the excise, and the element of absolute and unavoidable demand is lacking.

In the constitution of Massachusetts different limitations apply to "assessments, rates and taxes" than to "duties and excises" and it is consequently important in every case in which the constitutionality of an attemped exercise of the power of taxation is assailed to determine whether the pecuniary imposition under consideration is a tax or an excise. The substance of the distinction is guarded by the courts, and it would not be permissible to evade the limitations upon the power of laying taxes upon property by imposing an excise upon the privilege of owning property; nevertheless every excise is indirectly a tax upon property and the legislature may constitutionally provide that the amount of an excise shall depend upon the value of the privilege taxed, and that the value of the privilege shall be determined by taking into consideration the value of the property to which the privilege relates. Such an excise however is in no 1 Infra, § § 51-54 inc.

3

2 Pollock v. Farmers' Loan & Trust Co., 157 U. S. 429 (1895); Choctaw etc. R. R. Co. v. Harrison, 235 U. S. 292 (1914); Opinion of the Justices, 195 Mass. 607, 614 (1908); Opinion of the Justices, 208 Mass. 618 (1911); Opinion of the Justices, 220 Mass. 613 (1915). Thus a tax on the removing of whiskey from a bonded warehouse is in effect a tax on the ownership of the whiskey and so is a property tax. Dawson v. Kentucky Distilleries etc. Co., 255 U. S. 288 (1921). But there may be an excise on the ownership of dogs, for the right of property in such animals is a qualified one. Nicchia v. New York, 254 U. S. 228 (1920).

3 Maine v. Grand Trunk R. R. Co. 142 U. S 217 (1891); Commonwealth v. People's Savings Bank, 5 Allen 428 (1862); Commonwealth v. Hamilton Manufacturing Co., 12 Allen 298 (1866).

sense a tax on the property, and the value of property which is not subject to taxation may be considered in determining the value of a privilege for the purpose of fixing the amount of an excise.*

In the constitution of the United States a similar distinction is made between taxes and excises. It is provided that Congress shall have power "to lay and collect taxes, duties, imposts and excises,. ., but all duties, imposts and excises shall be uniform throughout the United States" 5 and that "no capitation or other direct tax shall be laid unless in proportion to the census or enumeration hereinbefore directed to be taken." There has been great difficulty over the meaning of the last clause and at first there was some doubt whether the two clauses were antithetical. It was held or intimated in the earlier decisions that the only direct taxes besides poll taxes were taxes on real estate, the theory being that the land-owner ultimately paid all taxes and so a tax on land was direct and other taxes indirect. Later decisions repudiated this doctrine and held that "duties, imposts and excises" included all forms of taxation known to the law which were not direct taxes, so that there does not seem to be now any substantial difference in the distinction between "assessments, rates and taxes" and "duties and excises" in the Massachusetts constitution and that between "capitation and other direct taxes" and "duties, imposts and excises" in the constitution of the United States."

4 Hamilton Co. v. Massachusetts, 6 Wall. 632 (1867); Commonwealth v. New England Slate & Tile Co., 13 Allen 391 (1866); Manufacturers' Insurance Co. v. Loud, 99 Mass. 146 (1868); Provident Institution for Savings v. Massachusetts, 6 Wall. 611 (1867); United States v. Perkins, 163 U. S. 625 (1897); Plummer v. Coler, 178 U. S. 115 (1900); Flint v. Stone Tracy Co., 220 U. S. 107 (1911).

5 Art. I, Sec. 8, cl. 1.

6 Art I, Sec. 9, cl. 4.

7 Hylton v. United States, 3 Dall. 171 (1796); Springer v. United States, 102 U. S. 586 (1880).

8 Pollock v. Farmers' Loan & Trust Co., 157 U. S. 429 (1895); same case on rehearing, 158 U. S. 601 (1895).

9 Thomas v. United States, 192 U. S. 363 (1902). The following federal taxes have been sustained as constituting duties or excises rather than direct taxes; a tax on carriages, Hylton v. United States, 3 Dall. 171 (1796); a tax on the circulating notes of state banks, Veazie Bank v. Fenno, 8 Wall. 539 (1869); a tax on the devolution of real estate by will or descent, Scholey v. Rew. 23 Wall 331 (1874); a tax on sales of merchandise at exchanges or boards of trade. Nichol v. Ames, 173 U. S. 509 (1899), a tax on the passing of property by will or intestate succession. whether in the form of a succession tax, Knowlton v. Moore, 178 U. S. 41 (1900), or of an estate tax, New York Trust Co. v. Eisner, U. S. (1921); a tax on agreements to sell shares of stock,

In determining whether a particular tax is a property tax or an excise, the name by which the tax is called in the statute imposing it is of no consequence. The court will look into the substance and effect of the tax, and if it is really a tax on property it cannot be made an excise by calling it one.10 On the other hand if it is really an excise it will be treated as such, although not called an excise in the statute.11

Treat v. White, 181 U. S. 264 (1901); a tax on tobacco prepared for consumption or sale, Patton v. Brady 184 U. S. 608 (1902); a stamp tax on contracts for the sale of certificates of stock, Thomas v. United States, 192 U. S. 363 (1902); a tax on the gross receipts of companies engaged in refining sugar, Spreckels Sugar Refining Co. v. McClain, 192 U. S. 397 (1904); a tax on the manufacture of cheese, Cornell v. Coyne, 192 U. S. 418 (1904); a tax on artificially colored oleomargarine, McCray v. United States, 195 U. S. 27 (1904); a tax on the doing of business in a corporate capacity measured by income, Flint v. Stone Tracy Co. 220 U. S. 107 (1911); a tax on the use of foreign built yachts, Billings v. United States, 232 U. S. 261 (1914). With respect to the taxation of incomes, it was at first held that an income tax was an excise, Springer v. United States, 102 U. S. (1880) but later that an income tax so far as it applied to a tax on the income of property was a direct tax, Pollock v. Farmers' Loan & Trust Co., 157 U. S. 429 (1895), 758 U. S. 601 (1895). The Sixteenth Amendment specifically authorized the levy of an income tax without apportionment, but the court has treated the amendment as merely correcting a mistaken theory under which the court acted in the Pollock case, Stanton v. Baltic Mining Co., 240 U. S. 103 (1916); Brushaber v. Union Pacific R. R. Co., 240 U. S. 1 (1916). The following taxes have been held to be excises and not property taxes by the Supreme Judicial Court of Massachusetts: A tax on the capital stock of banking corporations, Portland Bank v. Apthorp 12 Mass. 252 (1815); a tax on savings banks measured by their deposits, Commonwealth v. People's Five Cents Savings Bank, 5 Allen 428 (1862); Commonwealth v. Provident Institution for Savings, 12 Allen 312 (1866); a tax on the franchise of corporations measured by the aggregate value of the capital stock, Commonwealth v. Lowell Gas Light Co., 12 Allen 75 (1866); Commonwealth v. Hamilton Manufacturing Co., 12 Allen 208 (1866); a tax on foreign corporations measured by their authorized capital stock, Attorney General v. Bay State Mining Co., 99 Mass. 148 (1868); a tax on insurance companies, incorporated and unincorporated, measured by premiums, Oliver v. Liverpool etc. Insurance Co. 100 Mass. 531 (1868); an inheritance tax, Minot v. Winthrop, 162 Mass. 113 (1894); a tax on sales of stock certificates. Opinion of the Justices, 196 Mass. 602 (1908). With respect to income taxes it has been held that a tax on the income of property is a property tax, Opinion of the Justices, 220 Mass. 613, 623 (1915); Tax Commissioner v. Putnam, 227 Mass. 522, 531 (1917). The court has discussed but not determined the question whether a tax on the income from business or employment is a property tax or an excise, Opinion of the Justices, 220 Mass. 613, 624 (1915); but it has been held that a tax on the income of a foreign corporation can be sustained as an excise on the privilege of doing business measured by income when it could not be sustained as a property tax. Eaton, Crane & Pike Co. v. Commonwealth, 237 Mass. 523 (1921).

10 Flint v. Stone Tracy Co., 220 U. S. 107, 148-150 (1911); Zonne v. Minneapolis Syndicate, 220 U. S. 187 (1911); United States v. Emery, 237 U. S. 28; Dawson v. Kentucky Distilleries etc. Co., 255 U. S. 288 (1921).

11 Wagner v. Covington, 251 U. S. 95 (1919); Eaton, Crane & Pike Co. v. Commonwealth, 237 Mass. 523 (1921).