Court Opinion

ID: 7940903
Source: CourtListenerOpinion
Date Created: 2022-09-08 23:14:46.891454+00
Date Added: 2024-06-11T16:33:43.185309
License: Public Domain

Grant, J.
(concurring). Counsel for relators do not appear to contend that an inheritance tax — i. e., a tax upon the privilege of inheriting property or receiving it as a legacy or gift — is unconstitutional. Their contention is devoted mainly to a discussion of the proposition that the act does not provide for an inheritance tax, but in fact for a tax upon property, and is, therefore, in conflict with section 11 of article 14 of the Constitution. If this were a new question, I should have no hesitancy in pronouncing this a tax upon property, and therefore void under our Constitution. It cannot be sustained as a tax upon property, or as a specific tax, under the decision of Pingree v. Auditor General, 120 Mich. 95 (78 N. W. 1025). The tax is assessed upon the market value of the property as established by an appraiser or by the court. The character of a thing is not to be determined by the name given it, but by its inherent qualities. But the weight of authority in support of such taxation is so great, and its continuance so long, that I am compelled, contrary to my judgment, to sustain the legislation.
The decisions are practically unanimous that, in the absence of constitutional provisions inhibiting such method of taxation, it is valid. Its injustice, when applied to *497lineal descendants, — widows and children, — is recognized by nearly every legislature, and it is almost universally confined to collateral heirs and legatees. This act, however, imposes a tax upon all personal property in excess of $5,000 upon lineal descendants. All other transfers specified in the act are assessed at 5 per cent, of the market value. To sustain the act sustains the right of the legislature to impose the same tax upon lineal descendants. If it may impose 5 per cent., it may impose 10, or any other, percentage. "Where is the limit? One authority says that the taxation must be reasonable, and not amount to confiscation. The tax can only be justified under the necessities and needs of the government. Under a constitution which requires all property to be taxed to support the government, and taxed equally, I find some difficulty in understanding bow the necessities and needs of the government require this species of taxation. If this act provided for a tax upon transfers to lineal descendants, and if a man, having paid his tax under the general law on the 1st day of December, the day when taxes are payable in this State, died the next day, devising his property to his widow, she, in order to take it, would be compelled to pay 5 per cent. more'. She might die within the month, devising the property to their children-, and they must pay another 5 per cent, upon the market value of the property left. I am unable to see any justice in such taxation. A law similar to this was before the supremo court of New Hampshire in Curry v. Spencer, 61 N. H. 624 (60 Am. Rep. 337). By the constitution of that State the power to tax was expressly limited “to proportional and reasonable assessments, rates, and taxes upon all the inhabitants of, and residents within, tho said State, and upon all estates within the same.” Their bill of rights also provided that every inhabitant is bound to contribute only his share of the common burden. The tax was held to be in violation of both the constitution and the bill of rights, and the court said that under them—
*498“It [the tax] is simply extortion in the name of taxation, and it can, therefore, never be sustained invthis jurisdiction so long as equality and justice continue to be the basis of constitutional taxation.”
Speaking for myself, I fully indorse this language as applicable to this case.
The following cases, while recognizing the validity of inheritance taxes when not prohibited by a constitution, afford instances where the law was held to be in violation of the State constitution: In re Cope’s Estate, 191 Pa. St. 1 (43 Atl. 79, 45 L. R. A. 316, 71 Am. St. Rep. 749); State v. Ferris, 53 Ohio St. 314 (41 N. E. 579, 30 L. R. A. 218); State v. Switzler, 143 Mo. 316 (45 S. W. 245, 40 L. R. A. 280, 65 Am. St. Rep. 653). See, also, State v. Gorman, 40 Minn. 232 (41 N. W. 948, 2 L. R. A. 701). In State v. Switzler the tax was held to be not a succession or inheritance tax, but a tax upon property, because it was levied upon the appraised value of the whole estate, and not upon the separate legacy or share of each recipient.
Such tax is sustained upon the theory that, the title of the owner being extinguished by his death, the right to take by inheritance or devise depends upon the statute law, is purely a creature of the statute, and therefore the State may impose any condition it pleases upon the privilege of inheriting or taking by devise. This principle is stated in Magoun v. Savings Bank, 170 U. S. 288 (18 Sup. Ct. 594), in which, after citing the authorities, the court say:
“ It is not necessary to review these cases, or state at length the reasoning by which they are supported. They are based on two principles: (1) An inheritance tax is not one on property, but on the succession. (2) The right to take property by devise or descent is the creature of the law, and not a natural right, — a privilege; and therefore the authority which confers it may impose conditions upon it. From these principles it is deduced that the States may tax the privilege, discriminate between relatives, and between these and strangers, and grant exemptions; and are not precluded from this power by the provisions of the *499respective State .constitutions requiring uniformity and equality of taxation.”
While such a tax does not commend itself to my judgment, and is an evasion of the just principles of taxation, yet, as already stated, it has become too firmly established to now question its constitutionality. We are cited to no authorities, nor have I been able to find any, which hold such a tax to be invalid, except upon the ground that it is inhibited by constitutional provisions.
Having decided that an inheritance tax may be imposed under our Constitution, the chief remaining question is whether the act provides for a tax upon property, or an excise tax. The intent of the legislature, as appears in the title and the body of the act', must control. It expressly defines the tax to be one “ of inheritances, transfers of property by will, by intestate laws, by deed, etc., in contemplation of death.” It fixes such excise tax at 5 per cent. A percentage upon values is the only just method of fixing the tax, if any is to be imposed. It is entirely consistent with the nature of an excise tax, or a tax upon the privilege of inheriting. I concur in the opinion of my Brother Hooker.