Court Opinion

ID: 9763915
Source: CourtListenerOpinion
Date Created: 2023-08-29 03:00:49.796324+00
Date Added: 2024-06-11T07:29:51.137099
License: Public Domain

PALMORE, Judge
(concurring).
KRS 136.160, construed literally, requires that the value of a franchise be reached by subtracting the assessed value of the tangible property from the 100% value (“fair cash value,” cf. Kentucky Heating Co. v. City of Louisville, 174 Ky. 142, 192 S.W. 4) of the capital stock, the necessary result of which is to add to the value of the franchise the difference between the assessed value and the 100% value of the tangible property. To the extent, therefore, that the assessed value of the tangible property is less than its 100% value, the value of the franchise would be inflated beyond its actual 100% value, which is but an ultimate and indirect method of forcing an added assessment of the tangible property. Since this effect would be palpably discriminatory, the state has not followed the statute literally, but for many years has first “equalized” the value of the capital stock before subtracting the assessed value of the tangible property, a procedure which was uniformly recognized by the courts until 1947 (see Texas Co. v. Commonwealth, 303 Ky. 590, 198 S.W.2d 316), when this court in City of Louisville v. Howard, 306 Ky. 687, 208 S.W.2d 522, in effect removed the word “assessed” from the statute. If the percentages of equalization were the same (which, in the instant case, they are not), the final result of the process would be the same regardless of which way the formula is applied, and there would *884be no controversy. But to the extent that the percentage at which the total capital stock value is equalized exceeds the percentage at which the tangible property is assessed the taxpayer is subjected to the same evil as if the capital stock were not equalized at all. The difference is in degree only. The final result is that a portion of its tangible property is being taxed as a /part of its franchise. This being a form of double taxation on the tangible property, the taxpayer is deprived of the right to have his tangible property taxed uniformly as the tangible property of other taxpayers is taxed.
Though stated from a different approach, City of Louisville v. Howard, which we are urged to overrule in this case, actually resolves the dilemma in the simplest and best manner in which KRS 136.160 can be validly applied. It conforms with Const. § 172 in both letter and spirit, and this should redound to the advantage of the state in view of Kentucky Finance Co. v. McCord, Ky., 290 S.W.2d 481, because there is no necessity that the end result, the franchise value, be “equalized” at all.