Source: https://www.legalcrystal.com/case/98302/wilmette-park-dist-vs-campbell
Timestamp: 2018-03-21 05:21:51
Document Index: 549224219

Matched Legal Cases: ['§ 1700', '§ 1700', '§ 1700', '§ 1700', '§ 1700', '§ 1715', '§ 1700', '§ 1700', '§ 1700', '§ 1700', '§ 1704', '§ 8']

Wilmette Park Dist Vs Campbell - Citation 98302 - Court Judgment | LegalCrystal
Wilmette Park Dist. Vs. Campbell - Court Judgment
LegalCrystal Citation legalcrystal.com/98302
Case Number 338 U.S. 411
Appellant Wilmette Park Dist.
.....as this occurs, the services of the district will be less widely available, and its revenues from beach admissions will be reduced. but admissions tax, which is "paid by the person paying for such admission," is so imposed as to facilitate absorption by patrons of the beach, rather than by the district, and we have no evidence that the district will be forced to absorb the tax in order to maintain the volume of its revenues and the availability of its benefits. cf. metcalf & eddy v. mitchell, 269 u. s. 514 , 269 u. s. 526 (1926). "the mere fact that the economic burden of such taxes may be passed on to a state government, and thus increase to some extent, here wholly conjectural, the expense of its operation, infringes no constitutional immunity. such burdens are.....
U.S. Supreme Court Wilmette Park Dist. v. Campbell, 338 U.S. 411 (1949)
1. Having paid the penalties from its general revenue fund, petitioner's financial interest was sufficient to give it standing to sue for refund. P. 338 U. S. 414 .
2. Within the meaning of § 1700(a), the charge made by petitioner for admission to the beach was an "amount paid for admission to any place," and that section was applicable. Pp. 338 U. S. 414 -419.
(a) Congress did not intend by § 1700(a) to tax only admissions to "spectator entertainments." P. 338 U. S. 415 .
(b) The beach area here involved was a "place" within the meaning of § 1700(a)(1). Pp. 338 U. S. 415 -416.
(c) Congress did not intend to exempt nonprofit operations from the admissions tax imposed by § 1700(a) of the Code, notwithstanding certain exemptions that had previously been allowed. P. 338 U. S. 416 .
(d) That activities conducted by a municipality were not intended to be exempt from the admissions tax is indicated by a long continued administrative construction, expressly denying such exemption, which has been followed by repeated reenactment of the relevant language without change. Pp. 338 U. S. 416 -418.
(e) The fact that petitioner's beach patrons make use of a beach and its facilities, and that its admission charge may by local law be considered a "use tax," does not render § 1700(a) inapplicable. Pp. 338 U. S. 418 -419.
3. The application of the admissions tax in connection with this activity of the petitioner, though an instrumentality of a State, does not violate the Federal Constitution. Pp. 338 U. S. 419 -420.
In a suit for refund of penalties assessed for failure to collect federal admissions tax, the District Court entered judgment for petitioner. 76 F.Supp. 924. The Court of Appeals reversed. 172 F.2d 885. This Court granted certiorari. 37 U.S. 937. Affirmed, p. 338 U. S. 420 .
Section 1700(a)(1) of the Internal Revenue Code, as amended, provides for the imposition, except as to certain classes of persons under circumstances not important here, of "A tax of 1 cent for each 10 cents or fraction thereof of the amount paid for admission to any place, including admission by season ticket or subscription." [ Footnote 1 ] Paragraph (2) of the subsection declares that the tax "shall be paid by the person paying for such admission." And § 1715 requires that
Petitioner filed timely claims for refund which were rejected, and, in 1946, brought this suit against the Collector. The District Court entered judgment for petitioner. 76 F.Supp. 924. [ Footnote 2 ] The Court of Appeals for the Seventh Circuit reversed. 172 F.2d 885. Because the questions presented have importance in the administration of the admissions tax sections of the Code, we granted certiorari. 337 U.S. 937.
First. The Government raises no issue as to petitioner's standing to sue for refund. As recovery is here sought of penalties paid from petitioner's general revenue fund after its failure to collect the tax, we deem petitioner's financial interest clearly sufficient. [ Footnote 3 ]
The words of the provision, when taken in their ordinary and familiar meaning, reflect a legislative purpose of comprehensive application. By its terms, the section embraces every payment made in order to secure admittance to a specific location. And this purpose of broad application is not less certain because of anything in the legislative history of the initial adoption of that language. [ Footnote 4 ] In this view, it is unnecessary to consider whether petitioner's beach area can be distinguished from a "spectator entertainment," for we are unable to accept petitioner's argument that Congress intended in § 1700(a) to tax only admissions to such events. [ Footnote 5 ]
lighted; the land area was defined, and entrance was through gates. A payment was made by patrons of the beach as the condition of admittance to a specific area with definite physical limits. Thus, the fee which petitioner charged was "paid for admission" to a "place" as those terms are used in § 1700(a)(1). [ Footnote 6 ]
Nor is there greater force in petitioner's contention that the admissions tax was not intended to apply in the case of activities conducted by a municipality. In interpreting federal revenue measures expressed in terms of general application, this Court has ordinarily found them operative in the case of state activities even though States were not expressly indicated as subjects of tax. See concurring opinion in New York v. United States, 326 U. S. 572 , 326 U. S. 584 and n. 3 (1946). And in Allen v. Regents of the University
System of Georgia, 304 U. S. 439 (1938), it was decided that the admissions tax law was applicable in connection with activities carried on by an agency of a State, although it does not appear that the issue of legislative purpose was there disputed. However, we are unable to discover that there has been any design to exempt admissions to municipally conducted activities. [ Footnote 7 ] We regard the interpretative issue as controlled by a long continued administrative construction, expressly denying such exemption, [ Footnote 8 ] which has been followed by repeated reenactment
of the relevant language without change. [ Footnote 9 ] Cf. Helvering v. Winmill, 305 U. S. 79 (1938).
Finally, § 1700(a)(1) is not rendered inapplicable because beach patrons make use of a beach and its facilities, thus affording characterization of the admission fee as a "use charge." Few if any admissions taxable under § 1700(a) are not accompanied by a use of the property or equipment to which the admittee's license extends. Although table accommodations for which a charge is made are usually thought of as objects of a patron's use, yet Congress, in § 1704 of the Code, has declared that, for purposes of the admissions tax law, a charge for their use must be treated as a charge for admission, and not as a rental charge. A similar result must obtain when payment is prerequisite, as it was at petitioner's beach, to both admission to and use of a specific area. Chimney Rock Co. v. United States, 63 Ct.Cl. 660 (1927), cert. denied, 275 U.S. 552 (1927); Twin Falls Natatorium v. United States, 22 F.2d 308 (1927). [ Footnote 10 ]
is derived from a statute which contemplates a charge for "use." Ill.Rev.Stat. c. 105, § 8-7d (1947). The application of the federal admissions tax statute is not controlled by the characterization of petitioner's fee by local law. Cf. Morgan v. Commissioner, 309 U. S. 78 , 309 U. S. 81 (1940).
The Allen decision followed soon after Helvering v. Gerhardt, 304 U. S. 405 (1938), which declared two principles limiting state immunity from federal taxation. Id. at 304 U. S. 419 . The first of these, invoked in the Allen decision, was dependent upon the nature of the function being performed by the state agency and excluded from immunity such activities as might be thought not essential for the preservation of state government. We need not consider here the applicability of that doctrine, for the petitioner's assertion of immunity must be rejected on the second restrictive principle reaffirmed in the Gerhardt decision. This
304 U.S. at 304 U. S. 419 -420. According to this principle, the state "is not necessarily protected from a tax which well may be substantially
or entirely absorbed by private persons." Id. at 304 U. S. 420 .
While the Allen decision assumed that the admissions tax there imposed was a direct burden on the State, that assumption was required only for the purpose of considering the first principle of limitation of immunity as formulated in the Gerhardt case. Such an assumption need not be made here. It is true, of course, that, unless there is a shift in demand for admissions to petitioner's beach, imposition of the tax may to an undeterminable extent adversely affect the volume of admissions. [ Footnote 11 ] Insofar as this occurs, the services of the District will be less widely available, and its revenues from beach admissions will be reduced. But admissions tax, which is "paid by the person paying for such admission," is so imposed as to facilitate absorption by patrons of the beach, rather than by the District, and we have no evidence that the District will be forced to absorb the tax in order to maintain the volume of its revenues and the availability of its benefits. Cf. Metcalf & Eddy v. Mitchell, 269 U. S. 514 , 269 U. S. 526 (1926).
Helvering v. Gerhardt, supra, 304 U.S. at 304 U. S. 422 .