Source: http://supreme.nolo.com/us/342/382/case.html
Timestamp: 2019-04-21 02:13:46+00:00

Document:
Ohio levied an ad valorem personal property tax on all the boats and barges owned by appellant, an Ohio corporation, and employed in transporting oil along the Mississippi and Ohio Rivers. The main terminals are in Tennessee, Indiana, Kentucky, and Louisiana. The vessels are registered in Cincinnati, but they neither pick up nor discharge oil in Ohio, they stop in Ohio only for occasional fuel or repairs, they traverse a maximum of only 17 1/2 miles of waters bordering Ohio, and they were almost continuously outside Ohio during the taxable year.
Held: since the vessels would be subject to taxation on an apportionment basis in several other states, the Ohio tax on their full value violates the Due Process Clause of the Fourteenth Amendment. Pp. 342 U. S. 382-385.
155 Ohio St. 61, 98 N.E.2d 8, reversed.
The Supreme Court of Ohio sustained an ad valorem tax on the entire value of appellant's boats and barges employed in interstate commerce. 155 Ohio St. 61, 98 N.E.2d 8. On appeal to this Court, reversed, p. 342 U. S. 385.
Mississippi and Ohio Rivers. The vessels neither pick up oil nor discharge it in Ohio. The main terminals are in Tennessee, Indiana, Kentucky, and Louisiana. The maximum river mileage traversed by the boats and barges on any trip though waters bordering Ohio was 17 1/2 miles. These 17 1/2 miles were in the section of the Ohio River which had to be traversed to reach Bromley, Kentucky. While this stretch of water bordered Ohio, it was not necessarily within Ohio. The vessels were registered in Cincinnati, Ohio, but only stopped in Ohio for occasional fuel or repairs. These stops were made at Cincinnati, but none of them involved loading or unloading cargo.
The Tax Commissioner of Ohio, acting under §§ 5325 and 5328 of the Ohio General Code, levied an ad valorem personal property tax on all of these vessels. The Board of Tax Appeals affirmed (with an exception not material here), and the Supreme Court of Ohio sustained the Board, 155 Ohio St. 61, 98 N.E.2d 8, over the objection that the tax violated the Due Process Clause of the Fourteenth Amendment. The case is here on appeal. 28 U.S.C. § 1257(2).
placed inland water transportation on the same constitutional footing as other interstate enterprises.
Co v. Kentucky, 199 U. S. 194. Otherwise, there would be multiple taxation of interstate operations, and the tax would have no relation to the opportunities, benefits, or protection which the taxing state gives those operations.
I assume for the purposes of this dissent that none of the vessels in question was within Ohio during the tax year, and that they were taxed to their full value by Ohio. The record shows that the vessels were all registered in Cincinnati, Ohio, as the home port, and that Ohio is the domicile of the owner. Ohio claims the right to tax these vessels because they have not acquired a tax situs elsewhere than their home port and domicile.
engaged in interstate commerce has acquired an actual situs in a state other than the place of the domicil of the owner, it may there be taxed because within the jurisdiction of the taxing authority."
In the case at hand, the vessels had not acquired a situs for taxation in any other state. They were at large in the Ohio and Mississippi Rivers, touching ports therein from time to time. There was no showing as to how much time any of the vessels spent in any state. Indeed, the time spent in any state by the vessels plying the Mississippi River could not be shown with any accuracy, as the states on each side own to the middle of the stream. * The navigation channel might be on either side of the center line or right on the center line. Who is to say what state the vessels were in?
"was intended to cover and actually covers here, an average portion of property permanently within the State -- and by permanently is meant throughout the taxing year."
Id. at 336 U. S. 175. Without such assurance, there would have been no basis for applying the apportionment rule. New York Central & H.R. R. Co. v. Miller, 202 U. S. 584; Pullman's Palace Car Co. v. Pennsylvania, 141 U. S. 18, 141 U. S. 26; Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194, 199 U. S. 206.
of a taxable year. The record does show that no other state collected taxes on the vessels for the years in question or any other year. Until this case, it has not been the law that the state of the owner's domicile is prohibited from taxing under such circumstances.
Southern Pacific Co. v. Kentucky, supra, is a case in point. There, the owner of the vessels was a Kentucky corporation which operated between various coastal ports. None of the vessels was ever near Kentucky, but Kentucky was allowed to tax them because it was the state of the owner's domicile. The vessels were in and out of other states' ports, just as the instant vessels were in and out of other states' ports, but the mere possibility that some other state might attempt to levy an apportioned tax on the vessels was not permitted to destroy Kentucky's power to tax. The crucial fact was that the vessels were not shown to have acquired a tax situs elsewhere.
"The fact that Northwest paid personal property taxes for the year 1939 upon 'some proportion of its full value' of its airplane fleet in some other States does not abridge the power of taxation of Minnesota as the home the fleet in the circumstances of the present case. The taxability of any part of this fleet by any other State than Minnesota, in view of the taxability of the entire fleet by that State, is not now before us. It . . . is not shown here that a defined part of the domiciliary corpus has acquired a permanent location, i.e., a taxing situs, elsewhere."
Northwest Airlines v. Minnesota, 322 U. S. 292, 322 U. S. 295.
The fear of "double taxation" was much more real in that case than in the instant case; yet the Minnesota tax was sustained because there was no showing that a taxing situs had been acquired elsewhere. The question of what some other state might do so is no more before the Court in this case than it was in the Northwest case.
The majority today seeks to distinguish the earlier cases by magnifying the relevance of the continuous absence of the vessels from the domiciliary state. But the operative fact of the earlier cases was the absence or presence of another taxing situs. Where no other taxing situs was shown to exist, the state of the domicile was permitted to tax, irrespective of the amount of time the vessels were present in that state. Southern Pacific Co. v. Kentucky, supra.
As it is admittedly not shown on this record that these vessels have acquired a tax situs elsewhere, Ohio should be permitted to tax them as the state of the owner's domicile. I would affirm.
* Douglas, Boundaries, Areas, Geographic Centers, and Altitudes of the United States and the Several States, 2d Ed. (U.S. Dept. of Interior, Geological Survey Bull. 817).

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