Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-31
POWER EXCISE TAX
MEETS OPPOSITION
South Carolina and Idaho
Companies Oppose Levy
by States.
ny GEORGE z. poxHa.

NSAsS&SN1A
The electric utilities Of Ohio 1DpeAn
to have accepted without argument the
contention Of that State that interstate
electricity Is subject TO the excise tax
in the same way it Is applied to inter-
state gas under the decision Of the Su-
preme Court Of the United States In the
East Ohio gas case last May.
The power companies Of South Caro-
lima and Idaho, however, are vigorously
contesting in the Federal courts the eff
forts OF those States to collect taxes Of
one-hah mill per kilowatt hour on all
electricity generated within each of the
States. Regardless Of how the Federal
district courts decide the matter, the
question Is certain to be carried to the
Supreme Court, which will be called
upon to decide whether a State can
tax power generated within that State,
but actually used in another.
East Ohio Case.
In the East Ohio Gas case a some
what similar question was presented.
The East Ohio Gas Co. serves a large
number Of cities and towns in Ohio with
natural gas piped from West Virginia
by an afhliated company The Ohio
tax Is levied upon the business Of pub
lie utilities transacted within the State.
1t was contended by the gas company
that the gas from the neighboring State
was IN interstate commerce and there
fore nct taxable by Ohio. The Supreme
Court. however. ruled otherwise holding
that the transfer of the gas from trans
mission to distribution lines, with the
accompanying changes m pressure, con.
stituted in effect broken package"
by which the product lost its interstate
character
Attorney General Gilbert Bettman of
ONO holds that the same principle ap-
plies to electricity brought into the
State for distribution to consumers, and
at least some OF the electric companies
In Ohio seem to agree with him. The
Ohio Power Co. has just paid to the
State the sum OF S448,245, and the
Wheeling Electric Co. has paid $25,-
606. Both payments represent back
taxes and interest. Since the Supreme
Courts decision the State of Ohio has
from gas and electric companies and
expects to continue to collect approx
mately half million dollars a year
from these utilities.
Temporary Injunctions.
The Broad River Power Co.. the Lex
ington Water Power Co. and the South
CdTOlIld ROVER 20. IN Lne southern
State and the Utah Power & Light Co..
doing business in Utah, Idaho and
Wyoming, have secured temporary in
functions against the tax officials of
South Carolina and Idaho to restrain
the collection of the half-mill-per-kilo-
watt-hour tax. Much of the power these
companies generate within their respec-
tive States is exported to consumers in
adjoining States and the utilities insist
that the tax is unconstitutional.
OF the total of nearly 9l.000,000 900
kilowatt hours of electrical energy
available for distribution to consumers
in the United States during 1890,
nearly I2.O00o00,0oo kilowatt hours
were transmitted interstate. about IS
per cent. If half-m!ll tax were to be
applied by all the States. even after
excluding the interstate business, the
aggregate tax would amount to some
thing like s39.5oo.0o0.
(Copyrtght. 1917