# Transportation Company v. Wheeling

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United States Supreme Court
99 U.S. 273
Transportation Company v. Wheeling
ERROR to the Supreme Court of Appeals of the State of West Virginia.
This was an action of assumpsit brought for the recovery of the tax paid under protest to the city of Wheeling, by the Wheeling, Parkersburg, and Cincinnati Transportation Company, the owner of certain steamboats used by it in navigating the Ohio between that city and Parkersbury and the intermediate places on both sides of the river, in the States of West Virginia and Ohio. The vessels were of greater burden than twenty tons, and were duly enrolled and licensed under the act of Congress. The company was incorporated under the laws of West Virginia, and its stock was partly owned in that State and partly in Ohio. Its principal office was in Wheeling. The vessels started from that city on their voyages, and when not running were laid up there. They were assessed according to their value as personal property of the company, and the tax was collected under the laws of West Virginia, authorizing the city to 'assess, levy, and collect an annual tax for the use of the city on personal property in the city.' The right of the State to impose a tax on such vessels was denied by the company, as in violation of art. 1, sect. 10, par. 3, of the Constitution, which declares that 'no State shall, without the consent of Congress, lay any duty of tonnage,' and of art. 1, sect. 8, par. 3, which provides that Congress shall have power 'to regulate commerce with foreign nations and among the several States, and with the Indian tribes.' The Court of Appeals of West Virginia held the tax in question not to be within these provisions of the Constitution, and affirmed the judgment in favor of the city rendered by the court of original jurisdiction. The company sued out this writ.
Mr. Montgomery Blair for the plaintiff in error.
National vessels, or vessels duly enrolled and licensed under the laws of the United States to carry on inter-state commerce, are not subject to State taxation. The residence of the owners is immaterial. State Tonnage Tax Cases, 12 Wall. 204. And in view of that and other decided cases, it must be conceded that if the tax in question had been measured by the carrying capacity or tonnage of the vessels, it would be illegal; but it is contended that the constitutional prohibition is avoided, by taxing them according to their value. The company denies this, and maintains that the doctrine is contrary to the principles established by the rulings of this court in respect to the provisions of the Constitution bearing upon the question involved.
In Cooley v. Board of Wardens, &c. (12 How. 299), it was held, in effect, that any tax operating as a charge on such vessels, even if indirectly imposed, would be a tonnage duty, although levied under the name of pilot duties or penalties, and 'that it is the thing, and not the name, which is to be considered.' To the same effect is Steamship Company v. Portwardens, 6 Wall. 31. In that case, Louisiana imposed a tax of five dollars upon each vessel, without reference to its tonnage. This court held that the tax was void as a tonnage duty and as a regulation of commerce. A duty imposed on a ship by a State was declared to be within the constitutional prohibition.
It is contended by the city that this tax is not a duty on the ship, because not so eo nomine; and that the Constitution excepts shipping from taxation only when the law attempts to tax it by its description as shipping. Now, the vessels in question are just as much within the description of things taxed by the West Virginia statute as if it had specifically taxed them by name; for it is as ships that they are assessed, and not as so much timber and iron. As the thing is prohibited and not the name, the prohibition certainly applies here.
In support of the decision of the State court there are cited dicta of Mr. Justice McLean in Passenger Cases (7 How. 287), of Mr. Justice Clifford in State Tonnage Tax Cases (supra), and certain expressions in Hays v. The Pacific Mail Steamship Co., 17 How. 596, and in Morgan v. Parkham, 16 Wall. 473.
These dicta tend to sustain the views of the State court; but the question now involved is presented here for the first time, and they are in conflict with the principles actually decided by the court.
The right accorded to the States by Mr. Chief Justice Marshall, in McCulloch v. Maryland (4 Wheat. 316), to tax the interest of their citizens in the bank of the United States, whilst exempting the bank from such taxation, seems to be the origin of these dicta. But there is no analogy between that case and this. Shipping has not the double character of the bank as a public agency and as private property, and does not owe its exemption to any implications, which, arising from its being a public agency, exempt it only in that character from taxation leaving it subject thereto as private property, according to its value. Whilst recognized, in all respects, as private property, it is exempt by the express terms of the Constitution. This exemption extends to any form or amount of taxation upon a ship enrolled and licensed under the laws of the United States; and the reason therefor given by the court in Steamship Company v. Portwardens (supra), is that 'the prohibition upon the States levying duties upon imports and exports would have been insufficient, if it had not been extended to ships which serve as vehicles of commerce.' In Gibbons v. Ogden (9 Wheat. 1), the language of the court is, 'A duty of tonnage is as much a tax as a duty on imports or exports, and the reason which ensured the prohibition of these taxes extends to this also.' Hence all the reasoning which the court has applied to prevent any State taxation upon imports by 'varying the form without varying the substance,' is equally applicable to inhibit the States from imposing any tax upon shipping.
The argument in Brown v. Maryland (9 Wheat. 419), in favor of the right of the States to tax imports, is substantially that by which the validity of the tax in question is sought to be maintained; namely, that the tax was a personal one, and that only 'an import tax' was prohibited. The court declared the tax to be illegal, because it operated as a tax on imports, and they were not subject to any form of State taxation. Now, as shipping is pub by the Constitution precisely upon the same footing as imports, any tax upon property, whilst it continues in the form of shipping, is as illegal as a tax upon property whilst it remains in the condition of imports.
The fact that the vessels were assessed in their home port is immaterial. A tonnage tax assessed there has been held to be prohibited; and as the prohibition is not limited to a tonnage tax strictly so called, but extends to any duty, whether imposed directly or indirectly, or in any manner upon a ship, the principle involved here would seem to have been decided for the company.
Nor does it affect the question that vessels are not enumerated in the tax law as subjects of taxation. If exempt at all, they would be equally so by their description as personal property as by their description as ships,-it being held by this court that the prohibition forbids not only 'a duty proportioned to the tonnage of the vessels,' but 'any duty on the ship.' It is, therefore, unrestricted. They are the tools of that foreign and inter-state trade which it was intended to withdraw absolutely from State control, and, like the mechanic's tools, which the States have exempted from taxation, are as exempt from a general tax on personal property as from a specific duty on the articles.
Whether the vessels be taxed as personal property or specifically, the effect is to tax foreign and inter-state commerce.
If it be urged that as the tax is proportioned to the value of the vessel, and forms a part only of the common burden imposed upon personal property within the State, commerce cannot be injuriously affected by it, we reply in the language of the court in Brown v. Maryland, to the suggestion that the State might be trusted not to tax imports or exports to its own prejudice, that the Constitution has not left the question open.
No counsel appeared for the defendant in error.
MR. JUSTICE CLIFFORD delivered the opinion of the court.

## Notes

This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
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