The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1923-05-10
HIGH COURT RULES
IRON Ore TAX VALID
DECISION WILL TURN $4,000, 900
INTO STATE TREASURY
AT ONCE
81 COMPANIES AFFECTED
MINE OPERATORS APPEALED
FROM LAW PASSED BY LEG
STATURE IN 1921

Washington, May 7-Minnesota's
occupation tax on the valuation of
iron ore in Minnesota, had attacked
state was declared constitutional and
valid today by the supreme court.
Thirty-seven companies comprising
nearly all of those engaged in mining
iron ore in Minnesota, ha dattacked
the validity of the law in seven cases
and had obtained from the federal
district coourt of Minnesota an order
suspending it's enforcement.
The suits were based on an asser-
ton that the state, in the guise of
taxes, was seeking to exact annually
many millions of dollars in a way
which was obnoxious to both the Min
nesota constitution and the federal
constitution and which deprived the
companies of equal protection under
the law.
Mining, the Supreme court held, is
not interstate commerce, but, like
manufacture, is local and subject to
the discretion of the taxing powers
of the state. There were questions
involved the court said, which had
not been fully presented and must
be permitted therefore to go unans-
swered at this time and be more fully
considered when properly brought up
for decision.
Justice Van Devanter delivered
the courts opinion and no dissent
was announced. The opinion stated
that the basic question was whether
the tax was property tax, as those
bringing the case contend, or a tax
on the occupation of mining. The
court found no difficulty it was said
in the opinion in deciding that it
was, as the state had termed it, an
occupation tax. Another important
question presented in the case, the
court said, arose out of the conten-
ton that all the mines of the state
except six were operated under leases
which provides for the payment of
royalties to the owners upon the ore
mined. The owners of the six mines
asserted that the leasing companies
were permitted to deduct the royal
ties from the value of the ore before
paying the tax, while they were re-
quired to pay the tax upon the full
value of the ore they mined. The
court found that during the year
1921 which was used as the test for
bringing the suit, none of the owned
mines was operated. 1t therefore de-
clined on the showing made to pass
on the question whether the tax was
not equally imposed.
Discussing in detail the contention
of the mining companies that the
tax was invalid because it was inn
posed upon interstate commerce, the
court announced that during the
whole period of mining, while cars
were run into the open pit mines and
loaded, the ore upon the cars did not
pass into interstate commerce until
the tax was assessed.
100000 in Back Taxes
st. Paul, May 7-Approximately
$5,000,000 back taxes will become
due from Mining companies operating
in Minnesota under the decision of
the federal supreme court today in
sustaining Minnesota's law levying a.
six per cent gross earnings tax on
all ore mined in the state. The 1921
tax totaled about 100000 and
that for 1922 around 100000 At
torney General C. L. Hilton said to-
day. Collections has been held up
by the mine companies attack on the
constitutionality of the law.