5

terstate or foreign commerce a tax levied on it immediately before or after actual transit is unconstitutional. Thus property just imported into a State, from a foreign country, and still in the original package in which it was imported, cannot be taxed, as such a tax would be a tax on imports as well as an interference with foreign commerce. "Goods imported do not lose their character as imports and become incorporated into the mass of property of the State, until they have passed from the control of the importer or been broken up by him from their original cases. Whilst retaining their character as imports, a tax upon them, in any shape, is within the constitutional prohibition."

Where the property in question has been brought from another State of the Union a tax laid upon it is not obnoxious to the Constitution as a tax upon imports, since that refers to imports from foreign countries only. If objectionable, it must be merely as a regulation of interstate commerce. Whether it is so depends upon whether it is taxed as imported property, or while it is in transit, or as part of the mass of property within the State after it has. become incorporated into the bulk of the property of the country.

The question arose in the case of Brown v. Houston. That was a suit to enjoin the collection of a local tax on coal brought in barges from Pennsylvania and at the time of taxation lying in the Mississippi river. The owners alleged that the coal was mined in Pennsylvania, and was from that State imported into the State of Louisiana, as their property, and was then and had always remained in its original condition, and never had become mixed or incorporated with other property in that State. That when the assessment was made.

5 Brown v. Maryland, 12 Wheat. 436, 6 L. ed. 684; Waring v. Mayor, 8 Wall. 110, 19 L. ed. 342; Low v. Austin, 13 Wall. 29, 20 L. ed. 517; May v. New Orleans, 178 U. S. 496, 44 L. ed. 1165; Appeal of Pitkin, 193 Ill. 268, 61 N. E. 1048; People v. Barker, 155 N. Y. 330, 49 N. E. 940.

Field, J., in Low v. Austin, 13 Wall. 29, 34, 20 L. ed. 517.

7 Woodruff v. Parham, 8 Wall. 123, 19 L. ed. 382.

8 114 U. S. 622, 29 L. ed. 257.

the coal was afloat on the Mississippi river, in the parish of Orleans, in the original condition in which it was exported from Pennsylvania, and that the agents notified the board of assessors of the parish that the coal did not belong to them, but to the plaintiffs, and was held as stated, and was not subject to taxation; and they protested against the assessment for that purpose.

The court, however, held that the tax was valid. Mr. Justice Bradley said: "It was not a tax imposed upon the coal as a foreign product, or as the product of another State than Louisiana, nor a tax imposed by reason of the coal being imported or brought into Louisiana, nor a tax imposed whilst it was in a state of transit through that State to some other place of destination. It was imposed after the coal had arrived at its destination and was put up for sale. The coal had come to its place of rest, for final disposal or use, and was a commodity in the market of New Orleans. It might continue in that condition for a year or two years, or only for a day. It had become a part of the general mass of property in the State, and as such it was taxable for the current year as all other property in the city of New Orleans was taxable. Under the law, it could not be taxed again until the following year. It was subjected to no discrimination in favor of goods which were the product of Louisiana. It was treated in exactly the same manner as such goods were treated.

"It cannot be seriously contended, at least in the absence of any congressional legislation to the contrary, that all goods which are the product of other States are to be free from taxation in the State to which they might be carried for use or sale."

This decision was later approved and followed by the same court, and the rule was laid down by Mr. Justice Field as follows: "The correct rule is for the assessor or tax collector to assess all property found within his jurisdiction, being there

Pittsburg & S. Coal Co. v. Bates, 156 U. S. 577, 39 L. ed. 538

for the purpose of remaining till used or sold, and constituting part of the great mass of the general property of the country, provided always that the assessment does not discriminate between the products of different States."

8744. Distinction between regulation and taxation of such property.

11

The question was again raised in a recent case, and it was strenuously argued that the authority of the earlier decisions had been shaken by the later decisions in Leisy v. Hardin,10 and Lyng v. Michigan. But the court reaffirmed the doctrine of Brown v. Houston, the distinction between the cases being thus put by Mr. Justice White: "In Brown v. Maryland there was an absolute want of power to tax imports, and it was held that a state enactment which operated to tax imports, whether directly or indirectly, was within the positive prohibition. In other words, that imports could not be taxed. at all until they had completely lost their character as such. Woodruff v. Parham and Brown v. Houston, on the other hand, so far as interstate commerce was concerned, dealt with no positive and absolute inhibition against the exercise of the taxing power, but determined whether a particular exertion of that power by a State so operated upon interstate commerce as to amount to a regulation thereof, in conflict with the paramount authority conferred upon Congress. In order to fix the period when interstate commerce terminated, the criterion announced in Brown v. Maryland-that is, sale in the original packages at the point of destination—was applied. The court, therefore, conceded that the goods which were taxed had not completely lost their character as interstate commerce, since they had not been sold in the original packages. As, however, they had arrived at their destination, were at rest in the state, were enjoying the protection which the laws of the state afforded, and were taxed without discrimination, like all other

10 135 U. S. 100, 34 L. ed. 128. 11 135 U. S. 161, 34 L. ed. 150.

property, it was held that the tax did not amount to a regulation in the sense of the Constitution, although its levy might remotely and indirectly affect interstate commerce. In Leisy v. Hardin and Lyng v. Michigan the same question in a different aspect was presented. The goods had reached their destination and the question was not the power of the state to tax them, but its authority to treat the goods as not the subjects of interstate commerce, and to prohibit their introduction or sale. This was held to be a regulation within the constitutional sense, and therefore void. The cases, therefore, did not decide that interstate commerce was to be considered as having completely terminated at one time for the purposes of import taxation, and at a different period for the purposes of interstate commerce. But both cases, whilst conceding that interstate commerce was completely terminated only after the sale at the point of destination in the original packages, were rested upon the nature and operation of the particular exertion of State authority considered in the respective cases.

12

§ 745. Interstate carriage connected with interstate commerce.

A similar question arose upon the imposition by a State of a tax upon the business done wholly within the State, of carrying to points within the State in cabs passengers who had already been brought into the State by the same corporation. It was urged that the conveyance in the cab was part of an interstate journey, and to lay an excise tax upon it was to tax interstate commerce. The court however held that though connected with interstate commerce the cab service was not itself such commerce, and might be taxed.13 Mr. Justice Brewer said: "Many things have more or less close relation to interstate commerce which are not properly to be regarded as a part of it. If the cab which carries the passengers from the hotel to the ferry landing is engaged in inter

12 American S. & W. Co. v. Speed, 192 U. S. 500.

13 Pennsylvania R. R. v. Knight, 192 U. S. 21.

state transportation, why is not the porter who carries the traveler's trunk from his room to the carriage also so engaged? If the cab service is interstate transportation, are the drivers of the cabs and the dealers who supply hay and grain for the horses also engaged in interstate commerce? And where will the limit be placed? We are of opinion that the cab service is an independent local service, preliminary or subsequent to any interstate transportation."

§ 746. Property awaiting export.

The question is much the same in the converse case where chattels are held within a State awaiting export. Goods lying ready for immediate shipment into another State are not taxable,14 but it is otherwise if they are awaiting shipment not immediately, but at some time in the future.15 Whether the time for immediate shipment has come is not always easy to determine. The best guide for the determination of the question is in the language of Bradley, J., in Coe v. Errol: 16" When the products of the farm or the forest are collected and brought in from the surrounding country to a town or station serving as an entrepôt for that particular region, whether on a river or a line of railroad, such products are not yet exports, nor are they in process of exportation nor is exportation begun until they are committed to the common carrier for transportation out the state to the state of their distination, or have started on their ultimate passage to that state. Until then it is reasonable to regard them as not only within the state of their origin, but as a part of the general mass of property of that state, subject to its jurisdiction, and liable to taxation there if not taxed by reason of their being intended for exportation, but taxed without any discrimination in the usual way and manner in which such property is taxed in the state."

14 Ogilvie v. Crawford Co., 7 Fed. 745; Blount v. Munroe, 60 Ga. 61; State v. Carrigan, 39 N. J. L. 35.

15 Diamond Match Co. v. Ontonagon, 188 U. S. 82, 47 L. ed. 394. 16 116 U. S. 517, 525, 29 L. ed. 715.