Court Opinion

ID: 3504737
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:14:43.39673+00
Date Added: 2024-06-11T13:54:44.959939
License: Public Domain

Reargument was granted on the question whether interest and penalty should be allowed as to the tax on the two items of income on which recovery was sustained.
The income in question accrued in the years 1920 to 1925, inclusive. G. S. 1923 (1 Mason, 1927) § 2246, enacted in 1912 but amended in 1919 and ratified at the general election in 1920, provides for the five per cent tax on the gross earnings of railroad companies. The section further requires each railroad company to make semi-annual reports of its gross earnings, on February 15 and August 15 each year, and provides that the tax thereon shall become due and payable September 1 and March 1 next after such reports. Where items of earnings are not reported, there is therefore not only a default in making report but also a default in payment on the dates when payment should have been made. Under G. S. 1923 (1 Mason, 1927) §§ 2235 and 2240, the state was authorized to charge and collect the penalty and interest from the time payment should have been made. *Page 624 
In State v. G. N. Ry. Co. 160 Minn. 515, 527, 200 N.W. 834,839, the omitted earnings accrued prior to the adoption of the sections noted, and the decision was based on the holding that "there was no opportunity to pay the amount due without paying the excessive amount claimed." In our present case there was not only the opportunity but the statutory duty on the part of the railroad company to report and pay the tax. Even after the draft was presented, the company could, under G. S. 1923 (1 Mason, 1927) § 95, make payment of any part or item of such draft.
In County of Redwood v. Winona  St. P. Land Co. 40 Minn. 512,41 N.W. 465, 42 N.W. 473, recovery was sought of taxes on land omitted from assessments. As there had been no assessment or levy of taxes against the land up to the time the proceedings were commenced, the court held there was no default up to that time and penalties and interest for prior years could not be collected. There the duty of assessing and levying the taxes rested upon the county officials, and there was no opportunity to pay the tax until it was assessed. The court said that if the law had required the landowner to list the property for taxation and he had failed to do so, that would have constituted such default as would justify charging him with interest.
We find no ground for modifying the decision heretofore filed. *Page 625