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Statement of the Case.

6. The act of December 16, 1919 (108 O. L., pt. 2, 1078), providing for the levy and collection of a tax on the operation of motor vehicles on public roads and highways for the purpose of enforcing and paying the expense of administering the law and of maintaining and repairing the public roads, highways and streets, is a valid enactment not in violation of any provision of the state or federal constitution.

(No. 16552-Decided March 16, 1920.)

ERROR to the Court of Appeals of Franklin county.

Plaintiffs in error brought suit in the court of common pleas of Franklin county against the secretary of state. The petition challenges the constitutionality of the act of the general assembly passed December 16, 1919 (108 O. L., pt. 2, 1078), providing for the levy and collection of a tax on the operation of motor vehicles on the public highways of the state.

It is alleged taxes imposed by the act are excessive, unreasonable and unlawful, and contrary to the constitution and laws of the United States and of the state of Ohio; that said act is in conflict with the 14th Amendment of the Constitution of the United States; that it is discriminatory in that road rollers, traction engines, tractors, all horsedrawn vehicles and all trailers designed for certain specified uses are exempt; that said act, although denominated a license tax measure, is in reality an act raising general revenue, in conflict with Section 2, Article XII of the Ohio Constitution; that under the provisions of the act taxes in excess of seven million dollars will be collected from automobile owners in addition to the general property taxes

Opinion, per JOHNSON, J.

imposed under the general taxation laws, and that the cost of enforcing and administering the act will not exceed the sum of $168,000; that the taxes imposed are excessive and unreasonable and exceed the value of the privilege of using the roads and highways by owners of motor vehicles and exceed the combined expense of enforcing and administering the act; and that the motor vehicle is a common and usual mode of transporting persons and property on public highways and such use is a common and usual use thereof.

The petition prays that the defendant be restrained from collecting the tax. The court of common pleas sustained a demurrer to the petition, and the court of appeals on petition in error affirmed the judgment of the court of common pleas. This proceeding is brought to reverse the judgments of the courts below.

Mr. Walter D. Meals and Mr. C. D. Saviers, for plaintiffs in error.

Mr. John G. Price, attorney general; Mr. C. D. Laylin and Mr. B. W. Gearheart, for defendant in

error.

JOHNSON, J. The statute, the validity of which is attacked, provides for the levy and collection of an annual license tax on the operation of motor vehicles on the public roads and highways of the state, for the purpose of enforcing and paying the expense of administering the law and of maintaining and repairing public roads, highways and streets. The vehicles are classified by specific pro

Opinion, per JOHNSON, J.

visions of the act and the tax is graduated among the different classes.

It is contended that as the statute expressly provides that the tax is levied to pay the expense of administering the law and of maintaining and repairing the public roads, highways and streets, and as the petition alleges that the amount levied will largely exceed the cost of the administration and enforcement of the law, it is demonstrated that the law is one for the raising of general revenue, and, therefore, in conflict with Section 2, Article XII, of the Constitution, which provides that "laws shall be passed, taxing by a uniform rule," all property at its true value in money. As to this it is sufficient to say that the terms of the act itself clearly disclose its character.

It is perfectly apparent that this statute is a tax or revenue measure. The taxes are raised for a specific object, namely, the maintenance and repair of the public roads. The tax is levied on the privilege of operating a motor vehicle on the public highways. The provisions in the law with reference to its administration, and with reference to regulation and registration of motor vehicles, are merely incidental police regulations which do not affect the main object intended. The law provides that all fees collected under the chapter shall be paid into the state treasury to the credit of a fund to be designated as a "state maintenance and repair fund."

The granting of the license is the plan or detail provided for the imposing and collection of the tax. As held by the supreme court of the United States,

Opinion, per JOHNSON, J.

* *

License Tax Cases, 5 Wall., 462, "the requirement of payment for such licenses is only a mode of imposing taxes on the licensed business, and the prohibition * against carrying on the business without license is only a mode of enforcing the payment of such taxes." Does the obvious. fact that the law is a tax law, passed for the purpose of raising revenue for a certain specified purpose, render it obnoxious to the constitution?

It is urged that Section 2, Article XII of the Constitution, prescribes an exclusive method of raising taxes for general revenue. The power to tax is one of the highest attributes of sovereignty. Section 1, Article II of our Constitution, grants to the general assembly absolute legislative power.

In Southern Gum Co. et al. v. Laylin, 66 Ohio St., 578, at page 593, it was decided that "The absolute and unlimited power of taxation is granted by that section to the general assembly, and the taxation may be upon franchises, privileges or property, as the general assembly may deem best." This was also held in State, ex rel., v. Ferris, 53 Ohio St., 314.

It is well settled that the provisions of Section 2, Article XII, are limitations upon the general power granted by Section 1, Article II, so that when it comes to taxing property it is required to be taxed by a uniform rule at its true value in money. But upon the power to tax privileges and franchises there is no express limitation in the constitution. However, in Southern Gum Co. v. Laylin, supra, it was held that in the absence of an express limitation on the power of the general assembly to tax

Opinion, per JOHNSON, J.

privileges and franchises such power is impliedly limited by those provisions of the constitution which provide that private property shall ever be held inviolate but subservient to the public welfare, that government is instituted for the equal protection and benefit of the people, and that the constitution is established to promote the common welfare; that by reason of these constitutional safeguards a tax on privileges and franchises cannot exceed the reasonable value of the privilege or franchise originally conferred or its continued annual value thereafter. The determination of such values rests largely in the general assembly, but finally in the courts. So that it may be said to be the settled law of this state that under our constitution when property is taxed it must be taxed at its true value in money, by a uniform rule, and when a privilege is taxed it is required that it should be taxed at its reasonable value. It would be wholly impracticable, if not impossible, to prescribe any general rule for the valuation of a franchise or a privilege. Therefore, the reasonable value in each set of circumstances should be fixed.

Moreover, by the provisions of Section 10, Article XII of the Constitution, adopted in 1912, it is provided that laws may be passed providing for excise and franchise taxes. An excise tax has been defined to be a tax imposed on the performance of an act, or engaging in an occupation, or on the enjoyment of a privilege, and it is said. in 26 Ruling Case Law, 34, that the word has come to have a broader meaning and includes every form of taxation not a burden laid directly on persons or

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