Document: 329 U.S. 416 67 S.Ct. 444 91 L.Ed. 390 INTERNATIONAL HARVESTER CO.v.EVATT, Tax Com'r of Ohio. No. 75. Argued Dec. 12, 1946. Decided Jan. 6, 1947. Rehearing Denied Feb. 3, See 834, 628. On Appeal from the Supreme Court State Messrs. Joseph J. Daniels, Indianapolis, Ind., and Edward R. Lewis, Chicago, Ill., for appellant. Mr. A. Wendt, Columbus, Ohio, appellee. Justice BLACK delivered opinion Court. 1 The Ohio affirmed a decision that State's Board Appeals fixing amount owed by appellant its corporation franchise tax years 1935 to 1940, inclusive. 146 St. 58, 64 N.E.2d 53. In affirming, court rejected appellant's contention controlling act, §§ 5495—5499, Gen.Code, as applied appellant, was in violation Due Process clause Fourteenth Amendment Commerce Federal Constitution. Art. 1, § 8, cl. 3. case is here on appeal under 28 U.S.C. 344, U.S.C.A. 344. Appellant repeats arguments invalidity tax, but only 1937 2 Section 5495 Gen.Code provides each foreign authorized do business must pay or fee 'privilege doing business' 'owning using part all capital property' 'holding certificate * authorizing it this state'. It not denied section held during question. also owned operated two large factories at Springfield, which produced millions dollars worth goods. And four branch selling establishments associated with warehouses, fourteen retail stores, located various places stored sold goods factory. 3 But owns operates sixteen factories, nearly hundred agencies, numerous stores other states. Goods are addition, shipped storage out-of-Ohio warehouses be agencies customers. Some directly our-of-Ohio customers orders agencies. Conversely, manufactured Appellant's claim assessed against has been determined such manner sales made outside another interstate sales. These consequences result, argues, formula used determining value manufacturing sales, distinguished out-of-state 4 computed statute following manner: 5498 prescribes what taxpayer's total stock represents property conducted To determine this, issued stock1 divided half. One half then multiplied fraction, numerator property, denominator wherever owned. fraction whose 'business done' country-wide business. Addition these products gives base, which, when rate 1/10 1%, produces tax. 5 included an equal proceeds plants, no matter where had delivered.2 A measure consequently price Ohio-manufactured contends thus taxed clause. complete answer due process did Its imposed privilege profit. supreme construed imposing corporations engaging taxpayer engaged. manufacturing. long established state can fact chose factory produced, whether current past year does transform manufacturers something else. American Mfg. Co. v. City Louis, 250 459, 39 522, 63 1084; Hope Natural Gas Hall, 274 284, 288, 289, 47 639, 640, 71 1049; Utah Power & Light Pfost, 286 165, 189, 190, 52 548, 555, 76 1038; Wallace Hines, 253 66, 69, 40 435, 436, 782; Freeman Hewit, 249, 274, 277. D. Adams Storen, 304 307, 313, 314, 58 913, 916, 917, 82 1365, 117 A.L.R. 429, cases cited notes 14 15. 6 numerator, we assume branches factories.3 practice conduct account agencies' activities separately distinctly operations. followed distinction. treated conducting one type another. Thus measured preceding year's well those Here again, resulted taxing transactions wholly without substance. their were intrastate activities. International Harvester Department Treasury Indiana et al., 322 340, 1019, 88 1313. What effect inclusion element would have question need now decide. 7 said disposes grounds urged support contention. answers most argument ground application unduly burdens commerce therefore violates Of course, bar based merely because Ford Motor Beauchamp, 308 331, 336, 60 273, 276, 84 304. Nor computation Ohio's law includes receipts affect validity fair apportionment. e.g., ump Hairpin Emmerson, 258 290, 42 305, 66 622; Underwood Typewriter Chamberlain, 254 113, 41 45, 65 165; supra; Shoe Shartel, 279 433, 49 380, 382, 73 781; Western Cartridge 281 511, 50 383, 74 1004. here, clearly appears background legislation whole purpose arrive, undue complication, conclusion granted. October, 1924 struck down make apportionment between local so confine only. Equal Protection Air-Way Electric Appliance Corporation Day, 266 71, 45 69 169. April 1925, legislature passed new act expressly cure defects found old law.4 111 Laws 471. That 1925 Act, slightly amended,5 present made. 8 Plainly sought she entitled there nothing about indicates potentially unfair result any circumstances. even contended taxes could considered bear unjust improper relation if flat same amounts respective produced. Hump supra, page 296, 622. Furthermore, realized practical impossibility state's achieving perfect expansive, complex declared 'rough approximation rather than precision' sufficient. Illinois Central Ry. Minnesota, 309 157, 161, 419, 422, 670. Unless palpably dirproportionate comes apportionment, makes patent levied upon privilege, willing nullify honest efforts apportionments. collected Chief Stone, dissenting, Northwest Airlines 292, 325, 950, 967, 1283, 153 245. nullified achieved through consideration privilege. Since demonstrated achieves cf. Hans Rees' Sons, Inc. North Carolina, ex rel. Maxwell, 283 123, 134, 135, 51 385, 389, 75 879, since selling, come question, argued possible multiplication reason imposition None them operating 9 Affirmed. 10 RUTLEDGE, concurring. 11 I concur judgment desire add that, phase case, find basis lacking substantial connections preclude use them, McLeod, E. Dilworth Co., 327, 1023, 1304, dissenting pages 352—357, 1032—1034, 1319, indeed limitation sort material fairly For rest, holds, valid. sets out some detail factors considered, calculating outstanding stock. provisions issue. Rule 275, Commissioner Oct. 13, 1939, exempted before sale. include 'business-done' insists did. We resolve controversy, think whichever view taken. vetoing bill became law, relevant, Governor said: 'The decision, course necessary you devise levy You seen fit embody pending asset net assessment domestic well.' House Journal Vol. III, 874. over his veto. 112 410 (1927); 113 637 (1929); 114 714 (1931); 115 589 (1933).

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