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and confirmed, except that the accounts for taxation under section six of chapter three hundred and sixty-one of the laws of eighteen hundred and eighty-one, for the years eighteen hundred and ninety-two and eighteen hundred and ninety-three, shall be settled and adjusted by the comptroller by excluding the earnings of an interstate character as provided by this section.

[Revisers' Note.-L. 1881, chap. 361, § 6; R. S., 8th ed., 1155,

L. 1881, chap. 361, § 11; R. S., 8th ed., 1156, as am. by

L. 1894, chap. 562,

without change of substance.]

See Form No. 28.

The senate committee excepted from this section, street surface and elevated railroads, such companies being taxable under the new section 185. The committee also added to the list of corporations subject to the tax" transfer" and "baggage express corporations. These, however, appear to be covered by the general language of section 6 of the act of 1881.

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A State can levy an excise tax upon a railroad corporation for the privilege of exercising its franchise within the State. Maine v. Grand Trunk R. R. Co., 142 U. S. 217.

A tax upon the receipts of a corporation for transportation only is not an income tax. Philadelphia & S. Mail Steamship Co. v. Pennsylvania, 122 U. S. 326.

Telegraph companies receiving the benefits of State laws for the protection of their property and rights are liable to be taxed upon their real or personal property as any person would be. Western U. Teleg. Co. v. Att.-Gen., 125 U. S. 530; Leloup v. Mobile, 127 id. 640.

The following case is interesting in connection with this subject:

Taking as a basis of assessment such proportion of the capital stock of a car company as the number of miles over which it ran its cars within the State bore to the whole number of miles in that and other States over which its cars were run, was a just and equitable method of assessment. Pullman Palace Car Co. v. Pennsylvania, 141 U. S. 18.

The United States Express Company, an unincorporated joint-stock company or association carrying on business in this State,- held, subject to tax under Laws 1880, chap. 542, as amended, the provisions of that act not being confined to corporations in their restricted or technical sense. People ex rel. Platt v. Wemple, 117 N. Y. 136; S. C., 27 N. Y. St. Repr. 341 (1889).

A railroad corporation created by laws of another State, and doing business between several States, doing such incidental business in this State as was necessary to facilitate its interstate business,- held, that such incidental business related only to interstate commerce, and was not doing such business here as would render it liable to taxation under Laws 1880, chap. 542, § 3. People ex rel. Pennsylvania R. R. Co. v. Wemple, 29 Abb. N. C. 85; S. C., 47 N. Y. St. Repr. 695 (1892).

A tax imposed upon a railroad corporation whose line terminates outside the State, but merely has terminal facilities within it for the delivery of passengers and freight, the sale of tickets and the collection of dues is void, as the business of the company is interstate commerce exclusively. People ex rel. Penn. R. R. Co. v. Wemple, 138 N. Y. 1; S. C., 51 N. Y. St. Repr. 702; affirming 65 Hun, 252; S. C., 20 N. Y. Supp. 287 (1893). It seems that either a domestic or foreign corporation engaged in both domestic and interstate commerce may be taxed under the statute, provided the interstate business is not discriminated against. Id.

A railroad corporation organized under New York laws and operating a railroad between points in this State and another State is liable under Laws 1880, chap. 542, as amended by Laws 1881, chap. 361, to pay to the State comptroller the tax prescribed on gross earnings, this being a tax on franchise and not an interference with interstate commerce. People ex rel. Dunkirk, Allegheny Valley & P. R. R. Co. v. Campbell, 74 Hun, 210; S. C., 56 N. Y. St. Repr. 358; 26 N. Y. Supp. 832 (1894). See Ratterman v. W. U. Tel. Co., 127 U. S. 411.

The expenses of the board of railroad commissioners are paid by the railroad corporations in pursuance of section 170 of the Railroad Law.

Railroad Law (Laws 1890, chap. 565).

66

"§ 170. The total annual expenses of the board authorized by law, excepting only rent of offices and the cost of printing and binding the annual reports of the board as provided by law, shall not exceed fifty thousand dollars; and shall be borne by the several corporations owning or operating railroads according to their means, to be apportioned by the comptroller who, on or before July first in each year, shall assess upon each of such corporaitons its proportion of such expenses, one-half in proportion to its net income for the fiscal year next preceding that in which the assessment is made, and one-half in proportion to the length of its main road and branches, except that each corporation whose line of road lies partly within and partly without the State, shall in respect of its net income be assessed on a part bearing the same proportion to its whole net income that the line of its road within the State bears to the whole length of road, and in respect of its main road and branches shall be assessed only on that part which lies within the State. Such assessment shall be collected in the manner provided by law for the collection of taxes upon corporations." [Thus amended by Laws 1892, chap. 534.]

See Pullman Palace Car Co. v. Pennsylvania, 141 U. S. 18.

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§ 185. Franchise tax on elevated or surface railroads not operated by steam.- Every corporation, joint-stock company or association operating any elevated railroad or surface railroad not operated by steam shall pay to the state for the privilege of exercising its corporate franchise or carrying on its business in such corporate or organized capacity within this state, an annual tax which shall be one per centum upon its gross earnings from all sources within this state, and three per centum upon the amount of dividends declared or paid in excess of four per centum upon the actual amount of paid-up capital employed by such corporation, joint-stock company or association. Any corporation, joint-stock company or association taxed under this section which has paid a tax to the state for the year ending November first, eighteen hundred and ninety-five, under section three of chapter five hundred and forty-two of the laws of eighteen hundred and eighty, as amended by chapter five hundred and twenty-two of the laws of eighteen hundred and ninety, shall be credited by the comptroller with one-third of the amount so paid in computing the taxes to be paid for the year ending June thirtieth, eighteen hundred and ninety-six.

This section is new and was inserted by the committee of the senate. Such corporations heretofore paid a capital stock tax, and also a gross earnings tax of one-half of 1 per cent. By section 183, they are relieved of the capital stock tax, and will hereafter be taxed for State purposes under this section only.

The franchise to build and run a street railway is as much subject to taxation as any other property. New Orleans City & L. R. Co. v. New Orleans, 143 U. S. 192.

§ 186. Franchise tax on water-works companies, gas companies, electric or steam heating, lighting and power companies. Every corporation, joint-stock company or association formed for supplying water or gas, or for electric or steam heating, lighting or power purposes, shall pay to the state for the privilege of exercising its corporate franchises or carrying on its business in such corporate or organized capacity in this state, an annual tax which shall be five-tenths of one per centum upon its gross earnings from all sources within this state, and three per centum upon the amount of dividends declared or paid in excess of four per centum upon the actual amount of paid-up

capital employed by such corporation, joint-stock company or

association.

This section is new and was inserted by the senate committee. Such corporations heretofore paid a capital stock tax only. Section 183 exempts them from the capital stock tax, and hereafter they will be taxed for State purposes under the provisions of this section only.

Expenses of Inspectors of Gas Meters.

Transportation Corporation Law (Laws 1890, chap. 566). "§ 62. Inspector of gas meters.-The governor shall nominate, and by and with the consent of the senate, appoint an inspector of gas meters He shall receive an annual salary of five thousand dollars, to be paid in the first instance out of the State treasury on the warrant of the comptroller, which shall be charged to and paid into the State treasury by the several gas corporations in this State, in amounts proportionate to the amount of the capital stock of such corporations respectively, to be ascertained and assessed by the comptroller of the State. If any such corporation shall refuse or neglect to pay into the State treasury the amount or portion of such salary required of them respectively, for the space of thirty days after written notice given it by the comptroller to make such payment, then the comptroller may maintain an action, in his name of office, against any such delinquent corporation for its portion cr amount of such salary, with interest thereon at the rate of ten per cent per annum from the time when such notice was given and the costs of the action." [As amended by Laws

of 1893, chap. 385.]

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§ 187. Franchise tax upon insurance corporations.- Every insurance or surety corporation doing business in this state shall annually pay a tax into the treasury of the state for the privilege of exercising its corporate franchises in this state, at the rate of five-tenths of one per centum upon the gross amount of premiums received for business done in this state by such company or association, person or partnership whether such premiums were in the form of money, notes, credits or any other substitute for money. Life insurance corporations and purely mutual benefit associations, whose funds for the benefit of members, their

families or heirs, are made up entirely of contributions of their members and the accumulated interest thereon, shall be exempt from the tax fixed by this section. The term "insurance corporation," as used in this article, shall include all persons and partnerships doing an insurance business in this state.

[Revisers' Note.-L. 1881, chap. 361, § 5; R. S., 8th ed., 1154, as am. by

L. 1895, chap. 425,

L. 1886, chap. 679, § 1; R. S., 8th ed., 1696, as am. by

L. 1895, chap. 418,

without change of substance.]

See Form No. 29.

This section imposes on insurance and surety corporations a uniform tax of one-half of 1 per cent. of the gross premiums. Surety corporations heretofore paid a capital stock tax. See note to § 183. Laws 1886, chap. 679, as amended by Laws 1891, chap. 218, and Laws 1895, chap. 425, exempted from State taxation fire, marine and casualty insurance corporations of other States, the theory of the exemption being that, if such corporations were taxed in this State, other States would adopt or enforce retaliatory legislation against our own corporations. As New York corporations transact a large per cent. of the fire insurance business of the country, such a result would be disastrous. It is understood that the taxation of fire, marine and casualty corporation of other States, as effected by this section, is an inadvertence, and that there was no intention on the part of the legislature or the revision commission to reimpose such tax, and it is probable that the error will be corrected early in the next session of the legislature. It is likely that the comptroller will not enforce the tax until another legislature has had an opportunity to pass upon the question and correct what seems to be a manifest error.

The words" premiums received on business done in this State" mean premiums received on property situated within this State. People v. Nat. Fire Ins. Co., 27 Hun, 188 (1882); reversing 61 How. Pr. 334 (1881). See, also, People v. Home Ins. Co., 92 N. Y. 328 (1883); affirming 29 Hun, 204 (1883).

Under Laws 1880, chap. 542, p. 763, the corporation is not liable upon premiums received for insurance upon property situated without the State. Nor upon premiums upon goods imported and in bond. Id.; People v. National Fire Ins. Co. of New York, 27 Hun, 188 (1882); reversing 61 How. Pr. 334 (1881).

The provision of Laws 1886, chap. 679, § 4, exempting the personal property, franchise and business of insurance companies from taxation, except as provided in this act, is limited to fire and marine insurance companies, and does not include surety companies. Id.; People ex rel. Am. Surety Co. v. Wemple, 58 Hun, 248.

Companies guaranteeing the fidelity of persons holding places of public or private trust are taxable as insurance companies, under Laws 1881, chap. 361, § 3. People ex rel. Am. Surety Co. v. Wemple, 58 Hun, 248;

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