Court Opinion

ID: 9420014
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:52:34.206059+00
Date Added: 2024-06-11T17:22:21.767130
License: Public Domain

MR. Justice Frankfurter,
concurring.
In view of the dissents elicited by the Court’s opinion, I should like to state why I join it.
Rhode Island taxes its permanent residents in proportion to the value of their property. The State imposes the tax whether its residents own property outright or *499own it, legally speaking, in a fiduciary capacity. It is not questioned that the intangible assets in controversy could be included in the measure of the tax against the person of this trustee if he owned them outright. The doctrine that the power of taxation does not extend to chattels permanently situated outside a State though the owner was within it, Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194; Frick v. Pennsylvania, 268 U. S. 473, is inapplicable. The tax is challenged, as wanting in “due process,” because the Rhode Island resident is merely trustee of these intangibles and the pieces of paper that evidence them are kept outside the State.
Rhode Island’s system of taxing its residents — subjecting them to the same measure for ascertaining their ability to pay whether they hold property for themselves or for others — long antedated the Fourteenth Amendment. Rhode Island has imposed this tax, “it may be presumed, for the general advantages of living within the jurisdiction.” Fidelity & Columbia Trust Co. v. Louisville, 245 U. S. 54, 58. It can hardly be deemed irrational to say, as Rhode Island apparently has said for a hundred years, that those advantages may be roughly measured, for fiscal purposes, by the wealth which a person controls, whatever his ultimate beneficial interest in the property. “The Fourteenth Amendment, itself a historical product, did not destroy history for the States and substitute mechanical compartments of law all exactly alike.” Jackman v. Rosenbaum Co., 260 U. S. 22, 31.
In any event, Rhode Island could in terms tax its residents for acting as trustees, and determine the amount of the tax as though a trustee owned his trust estate outright. Rhode Island has, in effect, done so by treating all Rhode Island residents alike in relation to their property holdings, regardless of their beneficial interests. That is the practical operation of the statute. It is that which con*500trols constitutionality, and not the form in which a State has cast a tax. Lawrence v. State Tax Commission, 286 U. S. 276, 280; Wisconsin v. J. C. Penney Co., 311 U. S. 435, 443 et seq. Whether a Rhode Island trustee can go against his trust estate for the amount of the tax which Rhode Island exacts from him is of no concern to Rhode Island. Rhode Island’s power to tax its residents is not contingent upon it. A trusteeship is a free undertaking.